Web Travel Group shares dive on reduced margins outlook

The news: Web Travel Group revealed double-digit growth across transaction value and bookings for its wholesale bookings business WebBeds in the first half of the 2025 financial year, but flagged that its margins in Europe remain “subdued”.

The numbers: In a preliminary results update, Web Travel Group said WebBeds total transaction value (TTV) grew 26% compared to the prior corresponding period. WebBeds bookings were up 22% year on year.

However, first-half TTV/revenue margins are now expected to be around 6.4%, down from 7% indicated at its annual general meeting in August.

WebBeds first-half preliminary underlying EBITDA margins are expected to be around 44%, down from 52% in the previous corresponding period, reflecting lower revenue and operating expenses rising 15% year over year.

Web Travel Group said that WebBeds remains committed to its long-term targets of $10 billion TTV by FY30 and 50% EBITDA margins. FY26 EBITDA margins are expected to be in line with its 50% target.

The context: Web Travel Group, formerly called Webjet, demerged as a standalone B2B company in September, with Webjet’s consumer-facing business listing separately on the ASX as Webjet Group.

In August, Webjet flagged that its WedBeds’ TTV/revenue margins had been impacted by the collapse of tour operator FTI Group, the Paris Olympics and the European Football Championship.

In its preliminary results update, the company noted that European margins remained subdued, and overall margins were further impacted by customer financial incentive agreements in place, which are under review.

Web Travel Group will release its full first-half results on 20 November.

More news: Shares in Web Travel Group tumbled in morning trading on the ASX, after the B2B travel company flagged ongoing “subdued” margins in Europe for its wholesale bookings business WebBeds.

Web Travel Group shares fell 33% to $4.73 by 10:50am AEDT.

RBC Capital Markets analysts saw the company’s update as a ‘negative’ and kept their ‘outperform’ rating on the stock with a $8.50 price target.

The company’s demerged and newly listed B2C outfit Webjet Group also saw its shares hit by the announcement, lowering 4.7% to 91.5 cents, having lifted around 15% since joining the ASX last month.