Wotif announces massive profits

Wotif.com has announced their full year results highlighting strong revenue growth and margin improvement, delivering a 60% increase in net profit after tax to $26.4 million.

Wotif.com’s Chairman, Dick McIlwain, announced a record trading and profit result for FY2007 with very strong revenue growth and significant operating profit margin improvement delivering a 60% increase in after-tax profit.

Room nights sold across the 44 countries represented on Wotif.com’s website increased 39% to reach 3.81 million rooms sold (up from 2.74 million). This surge in sales provided a 48% uplift in revenues to $67.3 million (last year $45.5 million) and drove profit after tax to $26.4 million (up from $16.5 million in FY2006).

The Company’s result outperformed prospectus forecast by 38%.  

In view of the strong result, Dick McIlwain announced that the Board had declared a final fully franked dividend of 8 cents, taking the total dividend for the year to 13 cents (compared to a Prospectus forecast of 8.4 cents).

Graeme Wood, Wotif.com’s Managing Director, said “the result for the year had been exceptional with all markets performing strongly, driving another record result with $529 million in transactions being processed, up from $363 million last year “. Wood noted that room nights sold in all regions had increased with Australian room nights sold up 39%, New Zealand up 43%, Asia up 65%, Europe up 8% and the Americas up 35%.

He also noted that the value of rooms sold had also increased in the year by an average 4.7%.

Wood commented that Wotif’s marketing efforts in the year had provided significantly enhanced exposure for its accommodation partners with more than 33 million site visits (last year 24 million).

He said, “by directing more business to our accommodation suppliers in more than 44 countries we are able to secure great rates and choice for our customers.”

“It is really pleasing to see that this strategy has delivered for our customers, suppliers and shareholders”.

In commenting on the result, Wood noted that the record profit of $26.4 million had been achieved notwithstanding $1.1 million in option expenses being incurred for the first time in the year.

He said “Even with this extra cost, the business has demonstrated its ability to secure efficiencies from scale, with profit before tax margins increasing from 51% to 56% (or 58% excluding option costs)”.

On releasing the results, Dick McIlwain announced that following the Company’s Annual General Meeting in October, the Company’s Chief Operating Officer, Robbie Cooke, will be formally appointed Chief Executive Officer and Managing Director.

McIlwain noted this transition, which has been ongoing for the past 18 months, would see Graeme Wood assuming an Executive Director position with a focus on developing new business concepts and promotion of the business.

Graeme Wood said, “over the last 18 months Robbie has been handling the day-to-day operations of the business.”  “We have worked very closely together and I see this good working relationship continuing in my position as Executive Director.”  “This transition will enable me to focus on continuing to build Wotif.com’s profile.”

Report by The Mole