Company Reports

Shares in Webjet have commenced trading as a pure global online B2B accommodation bookings provider after the demerger of the B2C units. Reconstituted Webjet is trading at around AUD 7.40 per share, 14% above our recalibrated AUD 6.50 fair value estimate.

Webjet demerged its B2C units in September 2024, and is now a pure global online B2B accommodation bookings provider. It is to be renamed Web Travel Group from Oct. 2, 2024.

Webjet’s biggest operating unit is its B2B booking platform, WebBeds. The business contracts supply from independent hotels, chains and third-party providers, aggregates and supplies the inventory to travel retailers. The business allows smaller hotels to increase distribution channels. For travel intermediaries, WebBeds increases the available inventory for end customers.

We recommend Webjet shareholders vote in favor of the Demerger Resolution at the Extraordinary General Meeting on Sept. 17, 2024.

We raise our fair value estimate on Webjet by 9% to AUD 7.40 per share. While the 43% increase in fiscal 2024 underlying EBITDA to AUD 181 million (after share-based payment expenses) was in line with our expectations, the composition was high-quality.

Webjet’s largest operating unit is its B2B booking platform, WebBeds. The business contracts supply from independent hotels, chains and third-party providers, aggregates and supplies the inventory to travel retailers. The business allows smaller hotels to increase distribution channels. For travel intermediaries, WebBeds increases the available inventory for end customers.

Webjet’s biggest operating unit is its B2B booking platform, WebBeds. The business contracts supply from independent hotels, chains and third-party providers, aggregates and supplies the inventory to travel retailers. The business allows smaller hotels to increase distribution channels. For travel intermediaries, WebBeds increases the available inventory for end customers.

The 41% jump in Webjet's fiscal 2024 first-half underlying EBITDA to AUD 102 million was devoid of any major surprises. It shows the group is on track to meet our unchanged AUD 189 million underlying EBITDA forecast for fiscal 2024, excluding share-based payment expenses which we estimate will be AUD 6 million. We are content to sit at the top end of management's guidance of AUD 180 million to AUD 190 million for two reasons.

Webjet’s largest operating unit is its B2B booking platform, WebBeds. The business contracts supply from independent hotels, chains and third-party providers, aggregates and supplies the inventory to travel retailers. The business allows smaller hotels to increase distribution channels. For travel intermediaries, WebBeds increases the available inventory for end customers.

Shares in Webjet have fallen 9% since providing a trading update at the annual general meeting on Aug. 31, 2023, and are now trading in line with our unchanged AUD 6.80 per share fair value estimate. The underperformance, relative to the 1% decline in the S&P/ASX 200 over the same period, is not due to any alarming deterioration in trading conditions. Indeed, we have nudged up our fiscal 2024-26 EBITDA forecasts by around 4%, reflecting better-than-expected continuing momentum for WebBeds.

Webjet’s largest business unit is its B2B booking platform, WebBeds. The business contracts supply from independent hotels, chains and third-party providers, aggregates and supplies the inventory to travel retailers. The business allows smaller hotels to increase distribution channels. For travel intermediaries, WebBeds increases the available inventory for end customers.