Ambitious expansion, and a trading loss for Zuji, saw Webjet’s after tax profits halve in the year to June 30 but the online retailer insisted underlying growth remains positive.
The launch of Lots of Hotels in Dubai cost Webjet $2.3m while the "acquisition and transition" of Zuji set it back $5.4m.
The costs, together with a $1.6m trading loss for Zuji, saw Webjet's NPAT tumble to $6.5m, down from $13.6m the previous year, a fall of 52%.
Earnings before interest and tax (EBIT) fell more than 43% to $10.3m.
Excluding one off costs, Webjet said after tax profit climbed 5.6% to $14.4m while EBIT rose 8% to $19.6m.
“We are pleased with the continued growth in contribution achieved in a generally flat leisure travel market, with Webjet continuing to post gains in market share,” managing director John Guscic said.
He said the total transactional value trajectory has “continued to moderate” as it chased higher margins.
TTV increased 15.1% to $884m and revenue climbed almost 30% to $74.8m.
The Zuji loss was in line with expectations, Webjet said. In July Zuji was profitable, the firm added.
Guscic said Lots of Hotels, which started trading in March and has expanded to 10 markets, enjoyed a “very positive market reaction” and is generating $40m in annualised TTV.
“Momentum is continuing to grow. We expect this business to be profitable in the first quarter of 2013/14,” he said.
Meanwhile, the transition of Zuji is continuing with the switch of the Australian business to the Webjet platform completed. The transition of Hong Kong and Singapore will be finished by December.
Webjet said it will provide profit guidance for 2014 at its annual general meeting in November.
