Webjet boss John Guscic says the nature of travel bookings since the COVID-19 pandemic has changed.

Webjet boss John Guscic says the nature of travel bookings since the COVID-19 pandemic has changed.Credit:Arsineh Houspian

The ASX-listed company operates a local online travel booking website for consumers,and a global wholesale business called WebBeds,which sells hotel rooms to travel agents,tour operators and airlines.

WebBeds travel bookings have been above pre-pandemic levels since May,with this month’s total transaction volume expected to surpass record July levels as the accommodation wholesaler - which is the most profitable part of Webjet - benefited from strong Northern Hemisphere summer trading.

Yet despite the upwards trend,Guscic said the company remained cautious and had adopted a “once bitten,twice shy” approach to the renewed demand.

“We continue to watch cash,cash flow and debtor risk closely and are obviously tuned into the global forces threatening prosperity,” he said,citing the war in Ukraine,high inflation,a broken supply chain and on-again,off-again pandemic outbreaks causing issues for the travel sector. He was also concerned by continuing disruptions such as flight cancellations.

RBC capital markets analyst Wei-Weng Chen said global macroeconomic indicators suggested a slowing of the travel market,but WebBed’s growth should continue for the remainder of 2023 given its market share gains,rising customer numbers and technological improvements.

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Webjet’s online travel site is also growing,with its total flights market share expanding by 57 per cent since the onset of COVID-19. Chen said while there was significant travel demand,airline capacity was yet to return to pre-pandemic levels. This,coupled with higher ticket prices and widespread flight cancellations,could hurt flight sales.

Guscic said the company used the pandemic slowdown to “transform our businesses to ensure they would emerge more efficient,more profitable and with higher market share when travel returned”.

Bookings on its Australian website were growing 50 per cent faster than travel demand industry-wide,and its market share had doubled to 11 per cent since the onset of the pandemic,he said.

Webjet turned cash-positive in the six months to September 30,with an average monthly surplus of $3.5 million,compared with cash burn of $5.5 million a month last year.

In May,Webjet announced it had returned to profitability in the six months to March 31,even though it still handed down a full-year loss of $85 million.

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