31 March 2025

31 March 2024

See financial statements for definitions of specific financial terms and KPIs, including any Alternative Performance Measures (APMs)

Outlook

The strong start to the year was in line with our expectations and reflected good execution and market outperformance. Since the beginning of April trading has remained resilient, broadly in line with first half performance. At the same time, the more volatile macroeconomic environment has led to slightly lower visibility for summer bookings. As a consequence, the range of potential revenue outcomes for FY25E is wider and FY25E revenue guidance is updated to €740-790m. Guidance has been introduced for Adj. EBITDA (€430-450m) and operating free cash flow conversion (c. 100%, in line with our mid- term guidance), reflecting actions we are taking to deliver profitability and cash generation in a less predictable market environment. Our Mid-term outlook is unchanged. Our strong value proposition, compounded by the long-term positive spending trends underpinning the travel and leisure market, gives us confidence for the future.

(1)    Mid-term is based on FY27, CAGR 3 years from FY24-FY27

First half performance summary

Delivering commercial milestones in line with strategy

Commercial successes in the first half reflected HBX Group’s strategy to deliver strategic growth in accommodation and expand the ecosystem. Agreements signed in the period included:

• The launch of the Luxurist, a new platform to connect and curate travel and experiences in the luxury segment, expanding the Group’s ecosystem in this high growth segment.
• A new preferential agreement with Latin American OTA Despegar had an almost immediate impact on transaction volumes propelling it to become one of the Group’s largest distribution partners.
• An agreement with Minor hotels added over 180 properties in the MEAPAC region with the potential to add a further 300 properties over the next three years.
• Turkish Airlines launched a new Holidays offering in partnership with HBX Group and PerfectStay, offering passengers package holiday opportunities in over 60 countries.

Driving revenue growth and market outperformance
Group TTV was €3.4bn in the first half of the year, up 12% compared to the prior period despite the later timing of Easter, which negatively impacted TTV growth by approximately 1%. The global hotel market grew 6% in the same period(1), continuing the long-term trend of approximately double the growth rate of global gross domestic product. HBX Group outperformance reflected actions to unlock potential in high-growth markets as well as increases in third party supply. Direct sourcing remained the main source of supply with c.85% of HBX Group TTV coming from directly contracted suppliers in the period.

Group revenue of €319m was up 10% (9% in constant currency) in the first half of the year compared to the prior period. Travel to destinations in Europe and Middle East & Asia Pacific (MEAPAC) increased by 14% and 13% respectively with travel corridors within and between these geographies performing well. The Americas saw revenue growth of 2% with fewer short lead time bookings and lower demand from international travellers, especially in the second quarter. Data insights generated from the Group’s large data lake and evolution of artificial intelligence (AI) and machine learning (ML) methods generated incremental value by enabling better forecast accuracy and trading analysis, especially when the market outlook became less certain.
Take rate, the percentage of TTV that converts to revenue, was 9.5%, 0.1%pt lower than the prior period. This was mostly a result of changes in travel corridors and change in mix.

Focused on execution

Gross profit was €307m, up 10% with higher income from fintech solutions offset by higher costs, which included an increase in bad debt provisions.

Underlying operating costs of €(148)m grew 6%, well below the 10% growth in revenue. The proportion of fixed operating costs to total operating costs was unchanged at 83% with average full time equivalent employees (FTE) reduced by 1.5% to 3,498. There was continued focus on productivity and efficiency across the business with increased use of AI for applications such as translation and customer services and reorganisation in key functions such as sourcing, sales, data and pricing. Other cost increases reflecting higher costs related to cloud computing and continued investment in growth and new products. Central costs increases were mainly related to becoming a listed company. Depreciation & Amortisation was €(50)m, up 2% on the prior period.
Adjusted EBITDA of €159m was up 14%. Adj. EBITDA margin of 49.8% expanded by 1.7%pts compared to the prior period with good conversion of revenue growth into margin improvement.
Non-recurring costs of €(181)m and non-underlying costs of €(18)m were incurred in the period, both mainly related to the IPO. Including these charges, and a €(50)m depreciation and amortisation charge, operating loss was €(90)m. Net loss for the period was €(227)m.

Strong financial profile
Operating Free Cash Flow of €(117)m in the first half compared to €(97)m in the prior period. Working capital outflow of €(254)m reflected the expected seasonal unwind of working capital at the end of the high season for holiday travel in the northern hemisphere. On a last 12-month basis, operating free cash flow was €445m, with cash conversion of 107%, compared to 117% for full-year 2024 . Capex of €(22)m was €3m higher than the prior period and was mostly related to investment in technology resulting in total investment in technology (expensed and capitalised) of €44m, equivalent to 14% of revenue.

Adjusted net debt at 31 March 2025 stood at €807m, implying an adjusted net debt / adj. EBITDA of 1.9x. This compares to an adjusted net debt of €1,285m and adjusted net debt / adj. EBITDA of 3.2x at 30 September 2024. This positive development reflected IPO proceeds, as well as continued growth in Adj. EBITDA and strong cash conversion. The net finance charge of €(152)m included €(88)m related to the financial structure pre-IPO and refinancing costs. Net finance charges are expected to reduce substantially in future periods due to the reduction in net debt and improved terms agreed in the debt refinancing completed in the second quarter.

Reported net debt was €887m compared to €1,071m at 30 September, before working capital adjustments of €(80)m and €214m respectively.

Company milestones: Improved financial profile as a result of IPO
HBX Group successfully listed on the Spanish Stock Exchanges on the 13 February 2025, with stabilisation period ending on the 14 March 2025. The transaction raised €725m gross proceeds for the Company. Proceeds were used to reduce debt, after the payment of costs associated with the IPO, including transaction fees, accrued interest on refinanced debt and legacy incentive programmes.

On the 11 March 2025, S&P upgraded its credit rating on HBX by two notches, to BB- with a Stable outlook. On the 12 March 2025, Moody’s upgraded its credit rating on HBX by two notches, to Ba3 with a Stable outlook. On the 25 March, HBX Group successfully completed the refinancing of its capital structure, issuing new €600m term loan A, €600m term loan B and €400m revolving credit facility.

Post period end, HBX Group invested in on-line check in and guest hyper-personalisation with acquisition of Civitfun, a hospitality tech company, adding new capabilities that expand the technology available to hotels.

HBX Group will host a results presentation in London at 09:30 UK time on 14 May. To attend the presentation in person or to receive conference call dial in details please contact [email protected]. The results presentation will also be available by webcast with a replay available after the event has concluded. The Half Year 2025 financial reports and accounts are available to download from the Company website, www.investors.HBXGroup.com, along with the results presentation slides. A transcript of the webcast will be added after the event has concluded.