Web Travel Group tells investors it expects first-half underlying EBITDA to reach up to $86 million, even with headwinds from foreign exchange movements against the prior period.
The market reacts quickly, sending the share price up 13.3% to $3.15 by 11:34am AEST.
Alongside the earnings guidance, the company announces a $90 million share buy-back, signalling confidence in its balance sheet and cash generation.
RBC Capital Markets maintains an “outperform” rating on Web Travel Group and sets a $6 price target, implying substantial upside from current levels.
Data provider Visible Alpha shows the company’s update beating market expectations on several fronts.
The total transaction value margin comes in at around 6.7%, ahead of the 6.5% consensus estimate.
First-half group underlying EBITDA also tops forecasts, landing about 2.2% above Visible Alpha’s $81.2 million consensus.
The stronger margin and earnings guidance suggest Web Travel Group is managing costs and pricing more effectively than the market expected, even as currency swings weigh on results.
Analysts point to the margin beat as a sign the group’s model is holding up in a tougher travel environment.
