Helloworld Travel Ltd · ASX:HLO
Helloworld Travel — Investor Presentation (August 2019)
36 slides from Helloworld Travel's investor presentation, Aug 21, 2019
Slide 1: 2019 Investor Presentation
2019 Investor Presentation Andrew Burnes CEO Michael Burnett CFO
Slide 2: Disclaimer
Disclaimer The information contained in these materials or discussed at the presentation is not intended to be an offer for subscription, invitation or recommendation with respect to shares or securities in any jurisdiction. No representation or warranty, express or implied, is made as to the fairne
Slide 3: Agenda
AGENDA 1. OVERVIEW 2. FINANCIAL PERFORMANCE 3. STRATEGY & OUTLOOK 4. APPENDIX 3 Helloworld Travel Limited • FY19 Investor Presentation
Slide 4: Overview
OVERVIEW 44 Helloworld Travel Limited • FY19 Investor Presentation
Slide 5: FY19 Key Metrics
FY19 Key Metrics • TTV and revenue growth from retail network expansion and business acquisitions. TTV Total Dividend +9.1% $6,511m +13.9% 20.5 cents • Focus on driving profitable TTV. • Significant improvement in EBITDA and NPAT Earnings per Revenue from: +20.7% Share +9.8% $357.6m 31.5 cents o gro
Slide 6: Growth in member networks and numbers
Growth in member networks and numbers 2,447 at 30 JUNE 2019 | 2,223 at 30 JUNE 2018 • Building a network of high calibre and high achieving leisure and corporate agent members. • A unique and diverse value proposition for each agent network. • Providing members with improved product offerings and cr
Slide 7: Business Highlights
Business Highlights RETAIL EXPANSION • Retail network grew to 2,447, an increase of 224 members led by: o NZ network expansion will add annualised TTV of $300m mainly from enlarged associate member growth including agents Barlow Travel, Gilpin Travel, Atlas Corporate Travel and NZ Travel Brokers. o
Slide 8: Business Highlights
Business Highlights WHOLESALE / INBOUND • Strong sales results from enhanced ReadyRooms platform rolled out across Australia & New Zealand. • Extensive product range across brands. • Qantas Holidays brand to be transitioned to Viva Holidays. • Increased alignment between the Australia and NZ wholesa
Slide 9: Business Highlights
Business Highlights CORPORATE WINS • Significant new accounts won by HLO corporate business. • QBT appointed sole provider of travel management services for the SA Government. • Two year extension for providing travel management services to the Whole of Australian Government. • Reappointment of APX
Slide 10: Business Highlights
Business Highlights TECHNOLOGY INVESTMENT • New ResWorld retail mid-office platform for retail networks launched. • Launch of Helloworld Travel Business Insights dashboard technology. • Air Tickets system two year upgrade project completed. • Relaunch of wholesale agent ReadyRooms platform and new c
Slide 11: Business Expansion
Business Expansion During 2018 and 2019 HLO made a number of strategic business acquisitions to complement the Group’s existing operations and expand future product offerings to an increased network of agents, suppliers and customers. Full year impact of these acquisitions resulted in an FY19 revenu
Slide 12: Financial Performance
FINANCIAL PERFORMANCE 12 Helloworld Travel Limited • FY19 Investor Presentation
Slide 13: FY19 Results
FY19 Results FY19 FY18 Change • TTV and revenue benefiting from business $m $m % expansion, including Magellan Travel, Asia Total Transaction Value (TTV) 6,511.3 5,966.8 9.1% Escape Holidays, Flight Systems, Show Group Revenue 357.6 325.7 9.8% and Williment Travel, combined with strong Gross margin
Slide 14: Group Revenue and EBITDA
Group Revenue and EBITDA Group Revenue - FY18 to FY19 Group EBITDA - FY18 to FY19 370 80 1.5 360 75 2.4 77.3 -1.8 1.9 357.6 -0.2 350 70 4.8 Millions ($'m) Millions ($'m) 30.8 340 65 2.9 64.0 330 60 2.9 320 325.7 55 310 50 FY18 Revenue Underlying Business Reduced company FY19 Revenue FY18 EBITDA Unde
Slide 15: Group Revenue and EBITDA – by segment
Group Revenue and EBITDA – by segment Group Revenue - FY18 to FY19 Group EBITDA - FY18 -0.4 to FY19 370 -0.4 80 0.6 2.0 360 -3.2 75 77.3 4.7 357.6 350 70 33.1 Millions ($'m) Millions ($'m) 340 8.0 65 330 64.0 60 320 325.7 55 310 300 50 FY18 Revenue Australia New Zealand Rest of World FY19 Revenue FY
Slide 16: Air Ticketing – transactions and price trends
Air Ticketing – transactions and price trends FY19 - AU & NZ Domestic FY19 - AU & NZ International 5.0% 6.0% 4.5% 3.5% 4.0% 4.0% 3.0% 2.0% 2.5% 2.0% 0.0% 0.9% 1.0% -2.0% 0.0% -4.0% Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Transactions Average Pr
Slide 17: Australia Overview
Australia Overview • TTV increase from enlarged business and FY19 FY18 Change corporate growth. $m $m % • Revenue growth driven by business Total Transaction Value (TTV) 5,574.1 5,066.3 10.0% acquisitions and improved contracting outcomes. Revenue 282.8 249.7 13.2% • Gross margin increase from impro
Slide 18: Australia Revenue and EBITDA
Australia Revenue and EBITDA Australia Revenue - FY18 to FY19 Australia EBITDA - FY18 to FY19 290 70 280 282.8 -1.6 65 2.4 65.0 270 30.5 -1.8 Millions ($'m) Millions ($'m) 4.7 - 260 60 2.6 250 2.6 249.7 56.9 55 240 230 50 FY18 Revenue Underlying revenue Business acquisitions FY19 Revenue FY18 EBITDA
Slide 19: New Zealand Overview
New Zealand Overview FY19 FY18 Change • TTV growth from expanded retail network in $m $m % second half of FY19. Total Transaction Value (TTV) 851.9 803.7 6.0% • Revenue increase from higher retail sales partially offset by reduced company owned Revenue 59.2 57.2 3.5% stores and reduced volumes from
Slide 20: New Zealand Revenue and EBITDA
New Zealand Revenue and EBITDA 3.2 #REF! New Zealand Revenue - FY18 to FY19 New Zealand EBITDA - FY18 to FY19 61 12 0.3 1.5 11.6 60 -1.5 0.2 10 -0.2 59 3.2 59.2 -0.6 3.2 Millions ($'m) Millions ($'m) 58 8 57 57.2 6 6.9 56 55 4 FY18 Revenue Underlying Business Reduced FY19 Revenue FY18 EBITDA Underly
Slide 21: Rest of World Overview
Rest of World (ROW) Overview FY19 FY18 Change • Lower TTV and revenue from challenging $m $m % market conditions for Insider Journeys and Total Transaction Value (TTV) 85.2 96.8 (11.9%) wholesale USA. • Operating expenses were lower due to Revenue 15.6 18.8 (16.9%) restructured operations of Insider
Slide 22: EBITDA to NPAT
EBITDA to NPAT FY19 FY18 Change • Increased amortisation relates to increased $m $m % capital investment to support business EBITDA 77.3 64.0 20.8% growth initiatives and amortisation of intangible assets acquired from acquisitions. Depreciation & amortisation (20.4) (17.3) 17.9% Finance costs (2.4)
Slide 23: Capital spend and D&A
Capital spend and D&A Capital Expenditure Depreciation and Amortisation • Increased investment in technology including ResWorld, Air Technology assets Tickets booking system, Technology assets Readyrooms upgrade and Brand names & trademarks deployment of Amadeus Cytric Commercial agreements product
Slide 24: Liquidity and funding
Liquidity and funding FY19 FY18 FY17 Liquidity $m $m $m Total cash 204.8 203.5 198.1 Drawn debt (57.0) (42.1) (20.8) • Overall strong and stable cash position. Net cash 147.8 161.4 177.3 • Secured long term debt facilities in place. • Cash and debt facilities being used to FY19 FY18 FY17 fund acquis
Slide 25: Cash conversion
Cash conversion • Operating cash flow movement due to: FY19 FY18 Change ➢ Increase in non-cash items from profit on $m $m $m sale of Insider Journeys and redemption EBITDA 77.3 64.0 13.3 liability fair value remeasurement. Non cash items (3.8) 0.8 (4.6) ➢ Negative working capital movement due to hig
Slide 26: Strategy and Outlook
STRATEGY AND OUTLOOK 26 Helloworld Travel Limited • FY19 Investor Presentation
Slide 27: Strategy and Initiatives
Strategy and Initiatives PRODUCT & BRAND AWARENESS PROCESS TECHNOLOGY & REVENUE & CUSTOMER EFFICIENCIES INNOVATION MAXIMISATION ACQUISITION ResWorld application very well Increasing network uptake of Training and development Integration of Air Tickets Retail received preferred product Network activi
Slide 28: Conclusion – Outlook
Conclusion – Outlook • Business continues to deliver growth. Agency services remain in high demand by customers in leisure and corporate markets. • FY20 started well and we are in line with our expectations including: ‒ July 19 TTV up 7.1% on prior year. ‒ July 19 revenue up 7.9% on prior year. ‒ 2,
Slide 29: Appendix
APPENDIX 29 Helloworld Travel Limited • FY19 Investor Presentation
Slide 30: Company background information
Company background information A$5.07 A$632.0 M Share Price at 124.7M A$204.8 M Cash Market Cap at 30 June 2019 Shares Issued A$56.4 M Debt 30 June 2019 Board & Management Team Non-Executive Director and Chairman - Garry Hounsell Mr Hounsell was appointed to the Board as Chairman on 4 October 2016.
Slide 31: Our Business
OUR BUSINESS • Retail networks • Corporate • Wholesale • Inbound • Online • Ticket Consolidation • Tour Operating 31 Helloworld Travel Limited FY19 Investor Presentation
Slide 32: Revenue recognition summary
Revenue recognition summary 32 Helloworld Travel Limited FY19 Investor Presentation
Slide 33: Revenue reconciliation
Revenue reconciliation Under AASB15, wholesale businesses have moved from ticketed to departed revenue recognition. Below tables provide a reconciliation of the movement between the FY18 reported to the FY18 restated revenue and EBITDA. Revenue ($m's) 1H18 1H19 FY18 FY18 Revenue Reported 164.9 162.0
Slide 34: Yearly trend analysis
Yearly trend analysis The table below provides relevant Group performance information for key financial measures over the last five financial years: 2015 2016 2017 2018 (1) 2019 $m's $m's $m's $m's $m's TTV 4,696.2 5,088.0 5,872.3 5,966.8 6,511.3 Revenue 279.2 300.5 326.8 325.7 357.6 EBITDA (excludi
Slide 35: Thank You
THANK YOU 35 Helloworld Travel Limited • FY19 Investor Presentation
Slide 36: Investor Contact
INVESTOR CONTACT: Michael Burnett Chief Financial Officer michael.burnett@helloworld.com.au MEDIA CONTACT: Trudi Sheppard Director of Communications trudi.sheppard@helloworld.com.au 03 9867 9600 36 Helloworld Travel Limited • FY19 Investor Presentation
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