Short squeeze, page-136

OK, I've now checked the half year report and presentation. Here are some facts:

- Total group TTV has increased (compared with previous corresponding period) by: 22%
- Aust & NZ TTV had increased (compared with pcp) by: 19%
- Group underlying EBITDA has increased (compared with pcp) by: 41%

But here is the thing, the reported increase in TTV includes the impact of the recently acquired SunHotels. The reported "underlying" EBITDA excludes the impact of this acquisition. Very conveniently management neglects to report the "underlying" TTV increase. Also, the EBITDA does not account for factors such as an increased interest bill, presumably due to increased borrowings to pay for the acquisition.

This kind of reporting does not impress me.

Conveniently, growth figures for the core Webjet business are not provided. However, in the market update presentation provided in Feb 2015, a graph of "bookings growth" is provided. My best guess from this chart is that bookings (not TTV) have increased, for each half year, as follows:

- H1 FY12: growth in core business: 22%
- H1 FY13: growth in core business: 2%
- H1 FY14: growth in core business: 2% ; growth including new acquisitions: 38%
- H1 FY15: growth in core business: 17% ; growth including new acquisitions: 29%

Giving the following annual compound growth rates in the period:
- core business: 10%
- total business (ie including acquisitions): 22%

This paints a somewhat less alarming picture. You have to look deeper than the headline numbers!

Cheers, Mars