Webjet (ASX:WEB) Managing Director John Guscic told investors the company called an unscheduled briefing after what he described as a “completely unexpected” share price reaction to an ASX update about a newly initiated tax audit involving a Spanish subsidiary.
Guscic said the market appeared to have drawn “a much broader and inaccurate conclusion” from the disclosure, adding that it seemed some investors believed the company faced an “existential crisis.” “Let me be very clear at the outset: nothing has changed in the fundamentals of this business,” he said.
Spanish subsidiary audit: why it was disclosed
“Our decision to disclose was about openness, not escalation,” he said, framing the announcement as a governance decision to avoid responding reactively to investor speculation once Spanish media reports emerged.
He also placed the audit in the context of operating a large global travel business, noting the group has around 2,000 employees across more than 50 countries, serving over 50,000 travel buyers in more than 140 source markets. He said regulatory reviews and tax engagements were not new for the company and should be expected to continue, citing that the group had closed out three tax regulator engagements in the final four months of calendar 2025.
On the current audit, he said it had “just been initiated,” with a questionnaire and information request provided. He said the company would continue to cooperate and comply with continuous disclosure obligations, but repeatedly declined to answer questions on specifics while the matter is ongoing.
Scope and limits of commentary
During Q&A, Guscic said he would not comment on the details of the Spanish audit or provide financial metrics for Spain, despite analyst requests for clarification on items such as the type of tax, the period under review, and the revenue/profit exposure. He did, however, provide a directional comparison, stating the group is “substantially underrepresented in Spain compared to” a large competitor referenced by an analyst, without quantifying that difference.
He also confirmed operational continuity, saying the Palma office was still operating and that “nothing has changed” in fundamentals.
In response to a question about subsidiary coverage, Guscic said only one of the company’s two Spanish subsidiaries was included in the audit and identified it as the entity referred to as “Mundo” in the accounts.
Guidance reiterated; net financing costs reduced
Guscic said the company’s financial guidance remained unchanged as a result of the audit announcement. For the WebBeds business on a euro functional currency basis, he reiterated expectations previously discussed at the first-half results call:
- FY 2026 TTV margins of at least 6.5%
- FY 2026 expense growth in the high single digits
- FY 2026 EBITDA margins of 44% to 47%
- FY 2026 CapEx in line with FY 2025
At a group level on an Australian dollar reporting basis, he reiterated guidance for corporate costs (about AUD 24 million), depreciation and amortization excluding acquisition accounting (about AUD 31 million), underlying effective tax rate (about 17%), and cash conversion (about 100%). The only change he flagged was net financing costs, which he said were now expected to be about AUD 2 million lower due to ongoing cost management initiatives.
He said FY 2026 EBITDA guidance of AUD 147 million to AUD 155 million was unchanged, representing growth of 22% to 29% on FY 2025, despite euro and U.S. dollar headwinds in the fourth quarter. He also said cash was expected to be around AUD 450 million and stated the Spanish audit did not affect the group’s ability to access its AUD 200 million revolving credit facility secured last year.
Early commentary on FY 2027 trading
While noting the company would normally wait until full-year results in May to comment on current and future performance, Guscic provided an early update on FY 2027. He said outlook remained strong and that bookings growth—described as the “clearest indicator” of market share gains—was expected to remain in the double digits in FY 2027, with double-digit TTV also expected. He said the company expected to maintain a 6.5% TTV revenue margin.
Asked whether prior commentary about FY 2027 EBITDA margins still held, he said “nothing has changed fundamentally” but indicated the company would provide full FY 2027 guidance in May, incorporating all elements of the business.
He also said first-half and second-half performance was tracking in line with expectations and consistent with full-year guidance assumptions.
Market conditions and execution focus
Addressing broader travel market questions, Guscic said the company’s results are primarily driven by market share gains rather than overall market growth, pointing to first-half audited and published results showing underlying booking volume up 18% at a time when the company believed the market was growing around 4%.
He said the key drivers remain client wins, supply quality, and conversion improvements, and that the company continued to expect to outperform the underlying travel market in FY 2027.
Guscic concluded by reiterating that the call was prompted by what he viewed as an overreaction to the ASX disclosure and again characterized the situation as an audit involving a Spanish subsidiary, not a broader crisis.
About Webjet (ASX:WEB)
Webjet Limited provides online travel booking services in Australia, New Zealand, the United Arab Emirates, the United Kingdom, and internationally. It operates through Business to Consumer Travel and Business to Business Travel segments. The company offers WebBeds, an online marketplace for the travel trade that sources hotel inventory from travel suppliers, connects, aggregates, and merchandises that content in their platform and distributes it to a network of travel buyers who sell to the travelling public; and Webjet OTA, an online travel agency that enables customers to compare, combine, and book domestic and international travel flight deals, hotel accommodation, holiday package deals, travel insurance, and car hire worldwide.
