Despegar.com(DESP) - 2023 Q2 - Quarterly Report

Financial Performance - Gross Bookings reached $1.1 billion, up 44% YoY, driven by the recovery in Latin American travel demand [4] - Total Adjusted EBITDA increased 154% YoY to $17.3 million, marking the strongest performance since 1Q18 [4] - Revenues rose 41% YoY to $158.7 million, achieving a record quarterly level with a Take Rate of 13.8% [4] - Total Revenue for Q1 2023 reached $158,707,000, a 41% increase compared to $112,414,000 in Q1 2022 [64] - Gross Profit for Q1 2023 was $107,680,000, reflecting a 54% increase from $69,856,000 in Q1 2022 [64] - Operating Income for Q1 2023 was $7,258,000, a significant improvement from an operating loss of $4,802,000 in Q1 2022 [64] - Total Adjusted EBITDA for Q1 2023 was $17,272,000, compared to a loss of $22,256,000 in Q1 2021 [65] - Net loss for the three months ended March 31, 2023, was $697 thousand, a significant improvement compared to a net loss of $30,918 thousand for the same period in 2022 [68] Customer Engagement - The number of Loyalty Program members surged 343% YoY to 14.0 million, indicating strong customer engagement [4] - The number of transactions is a key metric indicating customer engagement, although specific figures were not provided [58] Market Performance - Gross Bookings in Brazil grew 89% YoY to $458 million, with transactions increasing 35% in the same period [7] - Brazil accounted for 43% of total transactions in 1Q23, increasing 35% YoY, with Gross Bookings growing 89% YoY to $XXX million [26] - Mexico represented 18% of 1Q23 transactions, with ASPs increasing 24% and Gross Bookings rising 23% YoY [27] - Transactions in the rest of Latin America decreased 13% YoY, but ASPs grew 43%, leading to a 24% increase in Gross Bookings [28] Revenue Composition - The proportion of Travel Packages in Gross Bookings reached 34%, up 4 percentage points YoY, enhancing the revenue mix [6] - Total Revenue increased 41% YoY to $158.7 million, driven by a shift towards Packages, Hotels & Other Travel Products, which grew 44% to $98.0 million [30] - The company’s revenue is primarily derived from commissions and service fees, with additional income from advertising and financial services [55] Operating Expenses - Operating Expenses rose 34% YoY to $100.5 million, primarily due to a 70% increase in Selling and Marketing expenses [34] - Selling and Marketing expenses increased by 70% to $51,892,000 in Q1 2023 from $30,517,000 in Q1 2022 [64] Cash Flow and Liquidity - Operating cash flow was positive at $5.2 million, compared to $32.2 million in 1Q22, reflecting a shift in cash generation [4] - Cash and cash equivalents decreased by $17.0 million to $228.0 million, mainly due to preferred dividend payments and tax payments [42] - Despegar generated $5.2 million in Cash from operating activities in 1Q23, down from $32.2 million in 1Q22 [43] - Net cash flows provided by operating activities were $5,179 thousand, down from $32,200 thousand in the prior year, indicating a decrease of 83.9% [68] - Cash and cash equivalents decreased to $205,143 thousand from $219,167 thousand, a decline of 6.4% [66] Guidance and Future Outlook - The company reaffirms its 2023 annual guidance, projecting revenues between $640 million and $700 million and Adjusted EBITDA of $80 million to $100 million [16] Assets and Liabilities - Total assets increased to $821,754 thousand as of March 31, 2023, up from $804,192 thousand as of December 31, 2022, representing a growth of 2.0% [66] - Current liabilities rose to $590,177 thousand, an increase of 4.5% from $564,485 thousand at the end of 2022 [66] - Total liabilities increased to $782,434 thousand, up from $763,193 thousand, marking a rise of 2.2% [67] - The company reported an increase in trade accounts receivable to $170,672 thousand, up 15.8% from $147,398 thousand [66] - The company’s accumulated losses slightly increased to $644,019 thousand from $643,322 thousand, indicating a marginal rise of 0.1% [66] - The company’s total shareholders' deficit attributable to Despegar.com Corp was $127,962 thousand, a slight increase from $127,150 thousand [66] Financial Services - Koin's EBITDA improved by $2.1 million YoY to negative $2.5 million, moving closer to breakeven in the second half of the year [9] - Financial Services segment reported a Total Adjusted EBITDA of negative $2.5 million, an improvement from negative $4.6 million in 1Q22 [45] - The Financial Services segment includes loan origination and processing services, contributing to diversified revenue streams [57] Seasonal Impact - Seasonal variations significantly impact Despegar's financial results, with higher bookings typically in the third and fourth quarters for the Southern hemisphere [53] Geographic Presence - Despegar operates in 19 countries across Latin America, enhancing its market presence and customer reach [60]