Despegar: Despegar.com Announces 4Q24 and FY24 Financial Results

4Q24 Revenue increased Rising 8.7% YoY to $221.4 Million and adjusted EBITDA Increased 18% YoY to $51.5 million, FY24 Revenue Grew 10% YoY and Adjusted EBITDA Increased 52% YoY Despegar.com, Corp. DESP ("Despegar" or the "Company"), Latin America's leading travel technology company, today announced unaudited financial results for the three-months ended December 31, 2024 ("Fourth quarter 2024" or "4Q24") and full year 2024 ("FY24"). Financial results are expressed in U.S. dollars and are presented in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). Financial results are preliminary and subject to year-end audit and adjustments. All comparisons in this announcement are year-over-year ("YoY"), unless otherwise noted. 4Q24 Financial and Operating Highlights (for definitions, see page 13) On March 4, 2025, Despegar held a special meeting of shareholders where shareholders accounting for 73.7% of Despegar's ordinary shares entitled to vote were present in person or by proxy, representing a quorum. Of the total votes cast, approximately 94.7% were in favor of the proposal to adopt and approve the agreement and plan of merger under which Prosus, a leading global technology company, will acquire Despegar for $19.50 per share in an all-cash transaction. Gross Bookings decreased 1% YoY, on an as-reported basis mainly due to FX headwinds. On a Foreign Exchange ("FX") neutral basis, Gross Bookings increased 38% YoY to $1.5 billion, driven by strong commercial execution and a robust demand environment across the region. On an as-reported basis, Revenues increased 8.7% YoY to $221.4 million, with a robust Take Rate of 14.7%. Revenues on a FX neutral basis increased 44% YoY. Adjusted EBITDA increased 18% YoY to $51.5 million, due to a combination of revenue growth, operational efficiencies and an increase in Travel Package sales which increased 457 bps YoY to 36.1% of Gross Bookings. As a result, Adjusted EBITDA margin expanded 187 bps YoY, to 23.3%. Net Loss of $(8.3) million in 4Q24, primarily driven by FX headwinds in the region. EPS for the quarter stood at $(0.19), compared to $(0.08) in 4Q23. Adjusted Net Income increased 45% YoY, reaching $30.6 million in 4Q24 compared to $21.1 million in 4Q23. Adjusted EPS improved YoY to $0.27 from $0.16 in the same quarter last year Loyalty Program members increased 41% YoY from 23.0 million to 32.5 million App transactions rose by 864 bps YoY, attaining a record-high share of 53.6% of total transactions during the quarter B2B and White Label Gross Bookings increased 28% and 30% YoY, respectively, and together accounted for 18% of total Gross Bookings, reflecting a YoY expansion of 418 basis points Total Cash, cash equivalents and restricted cash position of $247 million as of December 31, 2024, up $27.5 million QoQ, while operating cash flow was positive $27.7 million, increasing $1 million from 3Q24 In January 2025, Despegar partnered with HBX Group to expand its travel inventory, offering customers more lodging options and enhanced travel packages Full-Year 2024 Financial and Operating Highlights Total Gross Bookings reached $5.5 billion, representing a 2% YoY increase Total Revenue grew by 10% YoY to $774.1 million, compared to $706.0 million for FY23 (vs the FY24 revenue guidance of at least $760 million). Adjusted EBITDA increased 52% YoY to $175.2 million, $5 million vs the revised guidance of at least $170 million, while Net Income increased by 13.9% YoY from $24.5 million to $27.9 million Included in Russell 2000 and Russell 3000 equity indexes, on July 1, 2024 In 3Q24, Despegar formed a strategic alliance with World2Meet, leading to the divestiture of its Destination Management Company, BDexperience. The transaction included the transfer of nearly 600 employees to World2Meet Renewed its lodging outsourcing agreement with Expedia, solidifying its strategic partnership with the company In 3Q24, signed its first SaaS partnership with Karisma Hotels & Resorts, licensing SOFIA, Despegar's AI travel assistant to enhance guest experiences and unlock new revenue streams Damian Scokin, Despegar's CEO, said: "We believe Despegar delivered strong results in 4Q24 and FY 2024, underscoring market leadership through key milestones. During the year we launched Sofia, our award winning AI travel assistant that transformed travel planning in Latin America with personalized real-time insights. We also expanded our B2B and White Label offerings, fortifying partnerships across the travel ecosystem. We further streamlined operations during 2024 by spinning off our DMC business through a partnership, sharpening our focus on core growth. Soon after, we redefined our Expedia partnership through a 10-year lodging outsourcing deal, boosting sourcing flexibility and broadening our travel portfolio. Most recently, at the beginning of 2025, we entered into a new partnership with HBX Group, further broadening the range of lodging options and travel packages available to our clients. In late 2024 we signed a definitive merger agreement for Prosus to acquire Despegar at a price of $19.50 per share in an all-cash transaction and we anticipate closing the transaction in the second quarter of this year. Looking ahead, we are excited to leverage Prosus' extensive network of companies and strong balance sheet as we continue focusing on accelerating innovation, broadening our reach, and setting new standards in the travel market. We believe this milestone positions Despegar for a new era of sustainable growth and success, and we could not be prouder of our team's outstanding achievements over the past year." Amit Singh, the Company's CFO, added: "We are pleased to report that our fourth quarter revenue grew by 8.7% year over year, reaching $221 million. More importantly, our continued focus on maintaining an efficient cost structure resulted in a 18% year-over-year increase in Adjusted EBITDA, which rose to $52 million in 4Q24. Looking ahead, we remain firmly focused on driving strong revenue growth and margins. We believe the effectiveness of our strategies-optimizing revenue mix, increasing organic traffic, and deepening our penetration into sizable B2B market segments-positions us well for continued success." Key Operating and Financial Metrics The following table presents key operating metrics of Despegar's travel and financial services businesses as well as key financial metrics on a consolidated basis, post-intersegment eliminations between these businesses. (in millions, except as noted) 4Q24 4Q23 Δ % FY24 FY'23 Δ % Operating metrics Number of transactions 2.621 2.409 9 % 9.719 9.059 7 % Gross bookings $ 1,500.7 $ 1,514.3 (1 )% $ 5,452.8 $ 5,332.5 2 % TPV Financial Services (1) $ 18.6 $ 24.8 (25 )% $ 75.7 $ 78.0 (3 )% Average selling price (ASP) (in $) $ 574 $ 629 (9 )% $ 562 $ 590 (5 )% Number of transactions by Segment & Total Air 1.2 1.2 4 % 4.6 4.4 6 % Packages, Hotels & Other Travel Products 1.3 1.2 8 % 5.0 4.7 6 % Financial Services 0.1 0.0 729 % 0.1 0.0 311 % Total Number of Transactions 2.6 2.4 9 % 9.7 9.1 7 % Financial metrics Total Revenue $ 221.4 $ 203.7 9 % $ 774.1 $ 706.0 10 % Total Adjusted EBITDA (2) $ 51.5 $ 43.6 18 % $ 175.2 $ 115.5 52 % Net (Loss) / Income $ (8.3 ) $ (2.5 ) 230 % $ 27.9 $ 24.5 14 % Net (Loss) / Income attributable to Despegar.com, Corp $ (8.3 ) $ (2.5 ) 230 % $ 27.9 $ 24.5 14 % Plus: Accretion of Series A Preferred Stock $ (3.9 ) $ (3.5 ) 12 % $ (15.0 ) $ (13.3 ) 12 % Plus: Accrual of dividends of Series A Preferred Stock $ (3.8 ) $ (4.0 ) (5 )% $ (15.2 ) $ (15.7 ) (3 )% Plus: Accrual of dividends of Series B Preferred Stock $ - $ (0.5 ) (100 )% $ (0.5 ) $ (2.0 ) (75 )% (Loss) / Income attributable to common stockholders $ (16.0 ) $ (5.9 ) 169 % $ (2.8 ) $ (6.6 ) (57 )% Total share count - Common Stock 84,426 72,908 16 % 84,426 72,908 16 % Average Shares Outstanding - Basic (3) 83,234 77,325 8 % 81,748 77,170 6 % Average Shares Outstanding - Diluted (3) 83,234 77,325 8 % 81,748 77,170 6 % EPS Basic (4) $ (0.19 ) $ (0.08 ) 150 % $ (0.03 ) $ (0.09 ) (60 )% EPS Diluted (4) $ (0.19 ) $ (0.08 ) 150 % $ (0.03 ) $ (0.09 ) (60 )% (1) Presented on a pre intersegment elimination basis. Intersegment TPV amounted to $13.7 million in 4Q24 and $23 million in 4Q23 (2) Financial services segment reported a Total Adjusted EBITDA of positive $1.8 million compared to $3.0 million in 4Q23, as the company improved the spread between Take Rate and projected losses (3) In thousands (4) Round numbers. Revenue Breakdown (in millions, except as noted) The following table reconciles the intersegment revenues of the Company's three business segments for the quarters and full year ended December 31, 2024 and 2023: 4Q24 4Q23 Δ % FY'24 FY'23 Δ % $ % of total $ % of total $ % of total $ % of total Revenue by business segment Travel Business Air Segment $ 73.8 34 % $ 74.6 36 % -1 % $ 262.5 34 % $ 257.6 36 % 2 % Packages, Hotels & Other Travel Products Segment $ 142.3 64 % $ 125.6 62 % 13 % $ 494.0 64 % $ 437.0 62 % 13 % Total Travel Business $ 216.1 98 % $ 200.2 98 % 8 % $ 756.5 98 % $ 694.6 98 % 9 % Financial Business Financial Services Segment $ 14.1 6 % $ 13.5 7 % 4 % $ 51.1 6 % $ 40.9 6 % 25 % Total Financial Business $ 14.1 6 % $ 13.5 7 % 4 % $ 51.1 6 % $ 40.9 6 % 25 % Intersegment Eliminations $ (8.8 ) (4 )% $ (10.1 ) (5 )% (13 )% $ (33.5 ) (4 )% $ (29.5 ) (4 )% 13 % Total Revenue $ 221.4 100 % $ 203.7 100 % 9 % $ 774.1 100 % $ 706.0 100 % 10 % Total Revenue Margin (Take Rate) 14.7 % 13.4 % 126 bps 14.2 % 13.2 % 95 bps -- Financial Tables Follow -- Unaudited Consolidated Statements of Operations for the three-month periods and full year ended December 31, 2024 and 2023 (in thousands of U.S. dollars, except as noted) 4Q24 4Q23 Δ % FY'24 FY'23 Δ % Revenue $ 221,425 $ 203,660 9 % $ 774,061 $ 706,040 10 % Cost of revenue $ (53,644 ) $ (60,312 ) (11 )% $ (208,142 ) $ (228,938 ) (9 )% Gross profit $ 167,781 $ 143,348 17 % $ 565,919 $ 477,102 19 % Operating expenses Selling