One-stop model assists Webjet

ONLINE travel booking service Webjet says the next year will be difficult for the travel industry as a strong dollar fails to stimulate demand and consumers become more cautious.
Nanjing Night Net

Webjet has been able to largely escape a slowdown in demand, which it attributes to consumers preferring the one-stop shop that its online service provides.

The company yesterday posted a 24 per cent rise in annual net profit to $13.6 million, despite what it has described as a flat travel market.

Webjet’s managing director, John Guscic, said there had been a noticeable slowdown in demand across the entire industry, citing growth of just 0.8 per cent in the international market in May, compared with a 5 per cent rise in the same month last year.

”The market has clearly slowed down over the last six months,” he said. ”The Australian consumer is just generally more cautious. It’s no different to all the other retail groups who have spoken about the consumer behaviour.”

Mr Guscic said the strong Australian dollar was not stimulating demand for travel like it had a year ago. ”The next 12 months will continue to be tough for the airline and travel industries,” he said.

Webjet shares rose 4 per cent to $3.65 yesterday following the release of its full-year profit, which was slightly better than its guidance. Revenue rose 30 per cent to $59 million.

The company has not given guidance for this financial year but highlighted that it boosted total transaction value – the price at which travel products and services were sold – by about 14 per cent in July.

Webjet will pay a final dividend of 7¢ a share on October 5, taking the payout for the year to 13¢. It compares with a payout of 11¢ a share in 2010-11.

This story Administrator ready to work first appeared on Nanjing Night Net.