Web Travel Group shares slide on accounting adjustments
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The news: Web Travel Group shares slumped at market open on the ASX after the B2B travel group revealed a list of backdated changes to its FY23 and FY24 results, as well as an increase to its first-half EBITDA.
The numbers: Web Travel shares were down 5.3% at $4.26 by 10:30am AEDT after emerging from a voluntary suspension on the ASX.
The company said that it expects a $2.5 million increase to EBITDA in the first half of FY25 and a $32 million increase in the trade and other payables balance as at 30 September.
In relation to its FY24 accounts, Web Travel — then called Webjet — expects a $1.5 million reduction in EBITDA. The company reported underlying EBITDA of $188 million last year.
It also flagged a $32 million decrease to retained earnings as at 31 March 2023, reflecting adjustments related to prior years.
The context: Web Travel said that it was advised by its auditors of a requirement to change the application of an accounting standard to account for the differences between amounts accrued and amounts invoiced by and paid to suppliers.
The company said it was informed of the matter on Sunday and required a trading halt to assess its impact on Monday. The change has now been determined not to be material to the company's earnings and financial position, it said.
On Wednesday, Web Travel postponed the release of its first-half results by more than a week, saying that it is continuing to to finalise its financial statements.
Web Travel's consumer-facing counterpart, Webjet Group, which demerged in September, also delayed releasing its first-half earnings. Webjet Group shares rallied 1.8% to $0.85 at the start of trading today.
The source: ASX announcement
