Transformation Strategy Update - UBS Sydney Investor Session Presentation 18 March 2021
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Transformation
Strategy
Update.
UBS Sydney Investor Session Presentation
18 March 2021
1
WebBeds pre Covid-19.
Pre Covid WebBeds - 2nd largest global B2B provider…
landscape
Global Accommodation Market. WebBeds Market Share. WebBeds FY19 Sales.
as at 1H20. With a total global value c A$800Bn+ TTV (1). of global accommodation market. Sales mix.
B2B TTV
A$70Bn+(1) 4% FY19
Market Value Global Market Sales Mix.
Share
Independent Hotels Our market share represents Robust hotel portfolio sourced
are highly suited to WebBeds a significant growth through 30,000+ directly
distribution model. opportunity. contracted hotels, 55+ leading hotel
chains & 70+ third party providers
1) Management estimates
2) 8/4/4 profitability target - at scale 8% Tracking ahead of plan to deliver
revenue/TTV and 4% costs/TTV to deliver 4%
EBITDA/TTV .
“8/4/4” (2)
2
A post Covid-19 world.
Covid-19 has • Bedbanks remain a critical distribution channel supporting travel industry
recovery.
provided
opportunity to • Our strategic objective is now to be the #1 global B2B provider.
transform our
business. • Initiatives are currently underway to be 20% more cost efficient at scale.
• WebBeds is taking advantage of new revenue and cost reduction
opportunities offered in a post COVID-19 world
− Expanding into new Regions
− Serving new Customers
− Taking advantage of changing travel patterns
− Simplifying and refining technology and processes across the business
− Targeting A$10BN TTV
3
Transformation strategy underway.
Transformation Initiatives underway to deliver 20% greater cost efficiencies at scale.
started April 2020.
Strategic Key Strategic Initiatives. Opportunity.
objective to be
Looking at what we sell & how we sell it. • Revenue
the #1 global B2B Rethinking How We Do Business
Differentiating through innovation. • Cost reduction
provider.
Delivering the most robust, efficient and
Streamlining Technology • Cost reduction
flexible offering.
Increased Leverage of Data A.I, robotics and data driven decision • Revenue
Analytics making. • Cost reduction
Sharpened Focus on Cost
Simplifying processes across the business. • Cost reduction
Reduction
Refinement of Risk Management
Tightening risk and credit processes. • Cost reduction
Processes
4
Rethinking
how we do
business.
5
Looking at
what we sell
& how we sell it.
6
Revenue opportunities in North America.
New regional North America. Core North American Market
opportunities. • Large wholesale market but historically B2B Segments
underrepresented by WebBeds B2B Loyalty B2C Loyalty Online Retail Air
Loyalty Consumer facing Agent & consumer Major airlines
− 4% market penetration in Europe, redemption platforms facing platform that also sell
platforms which enabling with many direct ancillary travel
3% in APAC, and only 1% in Americas. are typically white customers to contracts products
labeled for earn or burn & 3rd party
• Largest destination within WebBeds consumer loyalty points connections
facing brands for travel
network
• Focused on leveraging new
opportunities Membership OTA Corporate Search
Member based Online travel Major travel Consumer facing
− Targeting new market segments programs agencies that management booking sites
that offer provide companies that acquire
discounted packaged & & small majority of
− Increasing share of Top 20 clients
travel & other individual travel “disrupters” customers from
services in a closed products providing full paid search (SEM)
− Expanding directly contracted inventory user group directly to or limited
in key cities environment consumers corporate travel
services
• New Senior hire – December 2020
cA$20 BN TTV addressable market (1)
1) Management estimates
7
Expanded revenue opportunities.
New regional Europe APAC Middle East & Africa
opportunities.
• c. A$26Bn B2B TTV market • c. A$24Bn B2B TTV market • c. A$4Bn TTV market
opportunity (1). opportunity (1). opportunity (1).
• Will continue to be an • Pre Covid-19 – On track to • Umrah Holidays
important region given be the largest region by International to
booking volume benefit once travel
the significant number of
restrictions lifted in Saudi
independent hotels • Will continue to see highest Arabia
growth potential post
• Expanding footprint in Covid-19 • Defending our market
Eastern Europe leader position by
• Domestic contracting strategy
during Covid-19 will allow the increasing our product
region to grow as domestic range
travel is 10x larger than
international travel pre-Covid.
• Gaining entry into
domestic opportunities that
were once impenetrable.
(1) Management estimates
8
Expanded market opportunity.
New customer Pre Covid-19 Customer Mix.
opportunities.
Tour
OTA’s & Super Apps
Corporate Travel Operators • Leveraging shift to online
Agents
8% • Member Only deals
20% • Last minute bookings
OTA's
• WebBeds already sells to
Retail Travel Agents, Corporate 17% the Top 5 OTAs globally
Travel Agents & Tour Operators
will continue to remain relevant
Super Apps
Retail Travel 3%
Agents
32% Wholesalers
20% Wholesalers
Provide access to all
newer distribution models
Market opportunity now > $70BN+ AUD TTV due to B2C channel expansion
9
Differentiation
through
innovation.
10Rezchain.
Rezchain provides Rezchain Value Proposition.
insurance against
future problems. Delivers Saves costs by Resolving
accounting Decentralised future loss issues before
integrity by smart contract mitigation & travel date
eliminating provides reducing provides for a
INTEGRITY build-up of TRUST validated & SAVINGS manual labour SEAMLESS seamless
discrepancies trusted source costs needed experience for
that would of truth to address the customer
lead to costly disputes & end hotel
issues
Allows for Resolving
confident issue before No integration
reconciliation travel date or coding
Reconciliation & settlement provides required;
IMMEDIATE issues notified CONFIDENCE of daily, CASH FLOW recipient cash SPEED simple, fast &
as they occur weekly and flow benefit intuitive
monthly with on time onboarding
bookings payments
11Covid-19 transformation & focus.
Rezchain delivered • Rezchain insured WebBeds against costly errors in the processing of mass
cancellations
significant value
during Covid-19. • Quickly alerted WebBeds to any integration issues as platform
enhancements were rolled out
• A greater focus on actioning Rezchain alerts has seen intercompany
reconciliation issues become almost non-existent
• Enhanced user-driven reporting features released enabling users to manage
their processes more effectively
• Delivered real $$ savings - reduced both labour costs and hard financial losses
12Rezchain = real $$ savings.
5 Years of
WebBeds Gains
savings on
intercompany Reduction in labour
and hard costs as a
bookings. Hard Costs Saved result of Rezchain
have resulted in
93,800 bookings 0.4% savings
Labour Costs
Saved result in material against TTV
financial loss (or 70% of
disputed bookings). Of Rezchain has proven
Disputed 33,500 hours these, Rezchain to virtually eliminate
Bookings reconciling between mitigated 90%. intercompany
platforms (15 min per reconciliation issues
disputed booking) Potential Hard loss
WebBeds (@ €250 per booking)
= €21.1m
€837,500
2.67m bookings 134,000 (@ €25/hr) Average dispute saving
with Rezchain to date per booking in
(or 5% of bookings)
(since 2016) Rezchain becomes
Avg time & labour
* Bookings are over a time saving per booking €7.90 + €0.30 =
period when each in Rezchain totals €8.20 per booking
platform was onboarded;
not an annual snapshot €0.30
Opportunity to target the 85% of non-intercompany bookings
Note: Intercompany bookings account for c.15%
of WebBeds bookings
13Opportunities.
Opportunity Opportunities for Rezchain beyond the hotel distribution space.
exists across
industries for
partners who Real Estate Automated Pharma Fashion
wish to mitigate Settlement
Decentralised - Securely sharing Supply chain stamp,
title registry system Potential to sell medical data from source materials
discrepancy. automated settlement - Tracking of vaccine to production
once reconciliation is delivery/usage
complete
Rezchain, at its core, is a trust engine.
Any two partners that need smart contracts to mitigate discrepancy of any sort
and thus insure against risk of loss are a commercial opportunity.
14Investment: LockTrip.
Investment in • Webjet Limited has made an investment of US$4.1 million (for new shares representing
a 25% stake) in LockTrip Holdings UK (LockTrip), with a further option to increase that to 51%.
an Open Source
• LockTrip provides a B2C hotel marketplace, underpinned by a blockchain economy
Blockchain. powered by a utility token, LOC.
• LockTrip also provides its own decentralised public blockchain, Hydra chain, powered by
the HYDRA coin.
• LockTrip has developed a blockchain that enables genuine commercial
applications at scale.
• Webjet Limited’s interest in LockTrip is three-fold:
• Accelerated development of our blockchain expertise
• Integration of LockTrip into the Webjet OTA for its B2C hotel offering
• Potential migration of the Rezchain application onto the Hydra chain, as Hydra solves many of
the issues that prevent the wholesale adoption of blockchain as an underlying platform.
15Why Hydra is a superior blockchain platform.
Potential Rezchain
migration to
Hydra to deliver
significant
benefits.
Predictable Scalability of POS Network Truly Shared Decentralised
Transaction Fees Operations Security Economy with Governance
HYDRA solves this HYDRA has 5x the Proof of Stake Strong Incentives Protocol (DGP)
by quoting fees at transaction capacity (used by HYDRA) Strong commercial Chain settings can
a fixed USD rate of Ethereum, & can is more secure than incentives for both be adjusted through
& by dynamically dynamically scale to Proof of Work (used nodes / stakers DGP by HYDRA
increasing 30x at times of high by Bitcoin & & developers / holders, providing
transaction capacity loads. Capacity can Ethereum). POS businesses. the flexibility to
at times of high load further be voted up networks can only be efficiently adapt to
(elastic capacity). by increasing the attacked by owning a changing market.
block size. a majority of the
network.
16Streamlining
technology.
17Pre Covid-19: Complex technology ecosystem.
Pre Covid-19 our
complex technology Multiple touch-points,
several ways to do the
ecosystem was a same thing & maintenance
overhead running all
reflection of our platforms ensuring
WebBeds product is
acquisition strategy. available across the
marketplace.
Four commercial trading
platforms leveraging a rich
content base & wide
reaching client distribution
to create the initial global
marketplace
18Deploy & begin acceleration.
Identify the
WebBeds WebBeds Connect 2.0.
Consolidate connectivity,
components to improving speed to market
across all WebBeds trading
enable seamless platforms and reducing
complexity.
global distribution WebBeds Booking Centre.
& platform A single point where bookings
from any trading platform will
consolidation. be managed by WebBeds,
our clients & supply partners.
This simplifies operations &
provides a single platform for
automation & machine
learning.
WebBeds Property
Catalogue.
Unify & align properties across
all WebBeds platforms under
a WebBeds property ID.
Simplify creation &
management of basic
property details from a
central service
19Now: Where we are today.
Reduce the
platform complexity WebBeds Contracting.
Unifying contracts into a single platform for
& continue to build all WebBeds distribution platforms. Providing
tailored interfaces & APIs to seamlessly fit into
additional the hotel’s distribution.
components. Webbeds Price & Distribution Hub.
Delivers a single revenue management
platform. Contracts are delivered to all clients
via WebBeds Shop, our new core distribution
engine.
WebBeds Payment Aggregation Hubs.
Singular point to integrate new VCC
Suppliers & support payment methods
worldwide with minimal effort
WebBeds Mapping Services.
A unified catalogues of properties, room
types, clients, suppliers.
WebBeds Supply Connectivity.
New ‘hubs’ to access in-demand content
& provide partners with innovative ways to
connect to the WebBeds global marketplace
providing global & domestic accommodation
offers & activities.
20Tomorrow: End of CY2021.
Opening our new
sales channels, API, WebBeds API.
A flexible, fast & reliable client API offering
Retail Website and the WebBeds suite of products (hotels,
vacation rentals, transfer & activities)
Cache to the WebBeds Cache.
WebBeds Global Ability for API clients to access an up-to-
date WebBeds portfolio for packaging
Marketplace. & onward distribution.
WebBeds Retail Booking Website.
Our showroom to empower travel agents
with flexible search and browsing options,
informative content & shopping basket to
efficiently design safe & exciting holidays.
WebBeds Content Catalogue.
Detailed, high quality and up-to-date hotel
& room information to give the client
correct expectations on what they book.
WebBeds ERP.
Simplifying & automating our billing
& payment processes, unifying our
distribution platforms in one ERP platform.
21A scalable, efficient &
dynamic technology
ecosystem to
support the evolving
& diverse demands
of the global
marketplace.
22Increased use of
Data Analytics.
23Data mining of the future.
From Leveraging meaningful insights.
quantitative data As a global wholesaler, WebBeds has a wealth
of raw booking data ready to be mined.
to qualitative Different sets of data can be mined to support
insight. different partners.
• Hotels: Gain a deeper understanding of
where their business was coming from look
to book ratio, and even how their
competitors in the same area are doing.
• Hotel Chains: Mining data to determine
which of their brands is most suitable for the
area/city, especially if they are venturing into
a new destination.
• Travel Agents/OTAs: Understanding which
alternative hotel to recommend based on
historical data to increase their conversion
rate.
24Helping WebBeds target opportunities.
Changing Example: Top destinations post Covid-19 will likely differ from those pre Covid-19
travel patterns What could be the top APAC destinations post Covid-19
provide unique
opportunities.
25Cost reduction
opportunities.
26Finance Backoffice – Where we are today.
Multiplatform Risks & Challenges.
management
• Four x ERPs
is complex & System complexities, multiple
Business Unit JacTravel Lots of Hotels DOTW SunHotels
resource heavy. gateways
Booking Engine iVector Juniper DOTW Connect HotelMaker
• Four x booking engines
Mapping risk
Communications SSIS Package Webservices Webservices Webservices
• Scalability issues
Volume increases risks
ERP Data Bus SSC Webservices Webservices Webservices
• Master Data challenges SunSystem Connect
Scattered across platforms
Accounting
• Complexity inefficiencies ERP
Multiplatform challenges
• Finance Reporting
Manual intervention, Excel Reporting
consolidation
• Benefits labour intensive
Payables & Receivables manual
27Finance Backoffice – Where we are going.
ERP unification On target to deliver.
delivers scalability
One ERP
& drives System integration
Business Unit JacTravel Lots of Hotels DOTW SunHotels
efficiencies across One Booking engine
Booking Engine iVector Juniper DOTW Connect HotelMaker
Darwin program delivery
the business.
Enhanced Scalability Communications WebBeds Datalake
Highly scalable solutions
Better Master Data ERP Data Bus Cloud Platform Integration
MD Management unified
Accounting
Multiple Efficiencies ERP
Centralisation, unification
Improved Reporting
Cloud enabled, Excel minimised
Reporting
Improved Benefits
Exception reductions
& increased automation
28Other initiatives to improve efficiency.
Simplifying • Automation projects are underway to streamline processes, reduce
manpower costs and improve revenue.
processes across
• Pre-empting the needs of clients and hotels and automating requests.
the business.
• Generates revenue which might otherwise be overlooked.
• Improved Quality Assurance
• Virtual Observer to record, transcribe and analyse all emails and calls to improve
standard of service and reduce disputes.
• Reviewing over 40 processes to assess potential opportunities.
• Working with Robiquity to deep dive into various departments such as Data Entry,
Contract loading, Mapping, Contracting, Reporting and Security.
29Outlook.
30Cost efficiencies delivery on track.
1H21 costs Initiatives are on track to deliver at least 20% greater cost efficiencies at scale.
down 42%
over 1H20.
8/4/4 8/3/5
Note:
8/4/4 = at scale 8% revenue/TTV and 4% costs/TTV
to drive 4% EBITDA/TTV
8/3/5 = at scale 8% revenue/TTV and 3%
costs/TTV to drive 5% EBITDA/TTV
31Profitability target keeps improving.
A track record
Mar-20:
of improving Covid-19
“8/3/5” target (3)
1H19
EBITDA margins Not yet at scale
8/3/5 = 62.5% EBITDA margin
over time. & tracking close
65.00%
to “8/5/3”;
targeting “8/4/4”
55.00% by FY22 (2)
8/4/4 = 50% EBITDA margin
45%
45.00%
8/5/3 = 37.5% EBITDA margin
“8/5/3”
35.00% target (1)
36.40%
23.80%
25.00%
Aug-17: Nov-18:
JacTravel DOTW
15.00% acquisition
acquisition
5.00% 0.90%
1) 8/5/3 = at scale 8% revenue/TTV and 5%
costs/TTV to drive 3% EBITDA/TTV
2) 8/4/4 = at scale 8% revenue/TTV and 4% -5.00% FY17 FY18 FY19 1H20
costs/TTV to drive 4% EBITDA/TTV
3) 8/3/5 = at scale 8% revenue/TTV and 3%
costs/TTV to drive 5% EBITDA/TTV FY17 FY18 FY19 1H20
32Powered for travel recovery.
33Thank
you.
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