HOLIDAYCHECK GROUP AG DGAP-News: HolidayCheck Group AG / Key word(s): Half Year Results HolidayCheck Group AG publishes second-quarter and first half-year figures for 2021 - second-quarter results show welcome improvement 2021-08-09 / 07:30 The issuer is solely responsible for the content of this announcement. ----------------------------------------------------------------------------------------------------------------------- CORPORATE NEWS HolidayCheck Group AG publishes second-quarter and first half-year figures for 2021 - second-quarter results show welcome improvement Munich, Germany, 9 August 2021 - Thanks to a partially gratifying business development in the second quarter, HolidayCheck Group AG's first half-year results for 2021 were satisfactory in the context of the Covid-19 pandemic. Notwithstanding our deliberate policy of reducing the Group's marketing activities to an absolute minimum, our key brands HolidayCheck, HolidayCheck Reisen, MietwagenCheck and DriveBoo benefited from strong demand for package holidays, hotel bookings and hire cars, especially in June. In fact, the Group as a whole even managed to generate a net profit in June. Although bookings subsequently fell and cancellation/rebooking rates increased in response to the gradual tightening of travel rules from the end of June and increased awareness of the delta variant in July, demand now appears to be stabilising. The total value of bookings for holidays with departure dates in the second half of 2021 now stands at over EUR 100 million. Once these holidays actually begin, the booking commission can be recognised as revenue. As a precautionary measure, this revenue has not been included in the figures for the first half of 2021. Based on past experience, holiday cancellations could still reduce our commission revenue by a significant margin. By contrast, in the first half of 2020, the anticipated commission revenue for holidays due to commence after each reporting period was recognised in the accounts on the basis of careful estimates. Excluding these commissions, HolidayCheck Group AG's first half-year revenue in 2021 was EUR 8.9 million compared with minus EUR 1.8 million for the same period in 2020. Second-quarter revenue for 2021 rose to EUR 7.3 million from EUR 4.9 million in the same quarter of 2020. Cost of goods sold (COGS), i.e. advance purchases of holiday services (e.g. expenditure for hotels, flights and transfer services) by the Group's in-house tour operator HC Touristik, for the first half-year declined from minus EUR 1.6 million in 2020 to minus EUR 1.3 million in 2021. By contrast, cost of goods sold in the second quarter of 2021 rose to minus EUR 1.0 million from minus EUR 0.1 million in the same quarter of 2020. Gross margin for the first half of 2021 stood at EUR 7.7 million compared with minus EUR 3.4 million in the first six months of 2020. Gross margin is defined as sales revenue less cost of goods sold (COGS). The second-quarter figure for gross margin was EUR 6.2 million compared with EUR 4.9 million in the same period of 2020. In 2020, the company implemented a series of comprehensive cost-saving measures in every area. This helped HolidayCheck Group AG to achieve a sustained year-on-year improvement in both quarterly and half-year earnings and therefore protect the liquidity position: Marketing expenses in the first half of 2021 fell to minus EUR 0.6 million compared with minus EUR 8.1 million in the first six months of 2020. The main factors here were lower voucher costs and the deliberate decision to suspend almost all marketing activities as of mid-May 2020. In the second quarter of 2021, marketing expenses were unchanged year on year at minus EUR 0.5 million. Personnel expenses for the first half-year declined from minus EUR 16.0 million in 2020 to minus EUR 10.7 million in 2021. The main factor here is the workforce reduction in the third quarter of 2020 in response to the Covid-19 pandemic. At minus EUR 5.6 million, personnel expenses for the second quarter of 2021 were down from minus EUR 6.9 million in the previous year. At minus EUR 5.2 million, other expenses in the first half-year of the current year were down from minus EUR 9.0 million in 2020. The second-quarter 2021 figure for other expenses was minus EUR 2.6 million, compared with minus EUR 3.3 million in 2020. This reduction was mainly achieved through Group-wide cost saving measures and lower service centre operating costs. First half-year EBITDA (earnings before interest, taxes, depreciation and amortisation) showed a year-on-year improvement from minus EUR 32.3 million in 2020 to minus EUR 7.8 million. Second-quarter EBITDA came to minus EUR 2.3 million in 2021, up from minus EUR 3.3 million in 2020. Operating EBITDA (operating earnings before interest, taxes, depreciation and amortisation) improved from minus EUR 31.6 million in the first half of 2020 to minus EUR 8.2 million in the period under review. In the second quarter, operating EBITDA stood at minus EUR 2.3 million compared with minus EUR 2.4 million in 2020. EBIT (earnings before interest and taxes) in the first half of 2021 was minus EUR 10.9 million, an improvement on the figure of minus EUR 36.2 million for the same period in 2020. Second-quarter EBIT was minus EUR 3.8 million in 2021 compared with minus EUR 5.3 million in 2020. EBT (earnings before interest and taxes) in the first half of 2021 improved to minus EUR 11.1 million compared with minus EUR 36.3 million in the same period of 2020. Second-quarter EBT was minus EUR 3.9 million in 2021 compared with minus EUR 5.3 million in 2020. Consolidated net profit/(loss) from continuing operations in the first half of 2021 was minus EUR 10.1 million, up from minus EUR 36.0 million for the same period in 2020. Consolidated net profit/(loss) from continuing operations for the second quarter of 2021 was minus EUR 3.6 million compared with minus EUR 5.1 million for the second quarter of 2020. Diluted and basic earnings per share from continuing operations were minus EUR 0.04 in the second quarter of 2021 compared with minus EUR 0.09 in the same period of 2020. As at 30 June 2021, cash and cash equivalents stood at EUR 62.1 million compared with EUR 33.7 million as at 31 December 2020. Positive and negative scenarios for the financial year 2021 At present, given continued uncertainty over the likely course of the Covid-19 pandemic in the coming months, it is still not possible to offer a quantitative forecast for gross margin and operating EBITDA. Instead, based on our forward plans, we have drawn up two scenarios - one negative and one positive - for the financial year 2021. These stand at each end of the range within which our actual results will probably lie on the basis of the information currently available. Each makes different assumptions about the impact of Covid-19 in terms of duration and intensity. Both will be continuously updated. For each of these scenarios, the Management Board has prepared qualitatively comparative assessments of the likely impact on gross margin and operating EBITDA. The following Management Board assessment for the financial year 2021 reflects both the underlying assumptions set out above and, based on our current knowledge, the two scenarios at each end of the range for the potential impact of Covid-19. In the positive scenario, the Management Board expects the HolidayCheck Group's gross margin (sales revenue less cost of goods sold) to at least double compared with the figure for 2020. Even so, it is likely that gross margin will remain significantly below the pre-crisis level of 2019. In the negative scenario, the Management Board expects the HolidayCheck Group's gross margin for 2021 to be roughly on a par with the figure for 2020. In financial 2020, the HolidayCheck Group achieved a gross margin of EUR 7.3 million compared with EUR 131.2 million in 2019. With regard to operating EBITDA, the Management Board anticipates a year-on-year improvement whichever of the scenarios proves to be more accurate. The figure for operating EBITDA in 2020 was minus EUR 35.9 million. Given the current uncertainty, we are unable to provide reliable forecasts of increases in gross margin and operating EBITDA. Outlook The positive trend in bookings during the second quarter of 2021 is a clear sign that many German, Austrian and Swiss holidaymakers are as keen as ever to travel. At present, however, demand for holidays is still being dampened to some extent by various factors, including complicated travel rules that are seen by many as inconsistent, low vaccination rates and concerns about a fourth wave of the pandemic. Looking further ahead over the medium and long term, however, HolidayCheck Group AG's Management Board believes there is outstanding potential for growth in the Central European travel sector, especially the online segment. Given the Group's lean cost structure, innovative strength and strong brand recognition, together with its solid liquidity position, the Management Board's assessment is that we are particularly well placed to benefit from this growth potential. Note The German version of the interim statement for the first quarter of 2021 will be published during the course of the day on the company's website at www.holidaycheckgroup.com under the heading 'Investor Relations'. About HolidayCheck Group AG: HolidayCheck Group AG (ISIN DE005495329), Munich, Germany, is one of Europe's leading digital firms for recreational holiday. With a total workforce of around 300, HolidayCheck Group AG comprises HolidayCheck AG (which operates hotel review and travel booking portals by the same name), HC Touristik GmbH (which operates the tour operator HolidayCheck Reisen), and Driveboo AG (which operates the car rental portals MietwagenCheck and Driveboo). HolidayCheck Group's vision is to become the world's most holidaymaker-friendly company in the world. Media and Investor Relations contact: HolidayCheck Group AG Neumarkter Strasse 61 81673 München Germany Armin Blohmann
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