eDreams ODIGEO S.A.

Good afternoon, everyone, and thank you all for joining us today for our Q2 fiscal year 2021 results presentation for the three months ending 30th of September, 2020. I'm David Larros, the Director of Investor Relations at Ethereum Solillo. As always, you can find the results materials, including the presentation and our results report, on the investor relations section on our website. I will now pass you over to Dana Dunn, our CEO, who will take you through the first part of the presentation. Thank you. Thank you, David.

Good afternoon, everyone. and thank you for joining us. Today, I'll give an overview of our Q2 of this financial year's results, current trading to date, and what we have done to even further improve our strategic position over the past few months during the pandemic. Following this, David Alicaga, our CFO, will take you through our financial performance in more detail. I will then finish with some closing remarks. Please turn to slide four, which gives a summary of our performance during Q2. During Q2, we have improved our performance as the market picked up significantly versus Q1. Yet we also saw renewed softening towards the end of the quarter. Trading shows the strong and rapid turnaround we experienced during the summer period. Trading improved from the April trough at minus 96% year-on-year in bookings to an average of minus 62% in the second quarter of fiscal year 21, despite further travel restrictions being imposed in some markets starting in early August. Clearly, July to September 2020 was still an extraordinary trading period because of the COVID-19 situation and its related travel restrictions. Of note, revenue margin down 75% year-on-year in the second quarter of FY21, reaching €34.4 million and doubling the amount of Q1 FY21. This was driven by a decrease in bookings of 62% and the reduction in revenue margin per booking, which was driven by lower average basket value of bookings due to the COVID-19 situation, which results in lower classic revenue from customers and lower revenue from providers. Marginal profit, which is revenue margin minus variable costs. This stood at 11.5 million euros positive. That's at 10 times the amount of Q1, and increasing the variability and flexibility of our cost structure, adapting to the new mix of bookings made by customers during COVID-19. This results in marginal profit per booking increasing 2.5 times from the Q1 figure to the Q2, despite revenues decreasing more than bookings. An adjusted EBITDA was a loss of 2 million euros. an 86% improvement on the Q1 FY21 figure. Another highlight is how we are managing our liquidity. Through these difficult times for the travel industry, we at eDreams or Digio have managed our liquidity well, which remains strong despite short-term trading and acceleration of reimbursements to customers. Because we have a strong liquidity position, we made a proactive decision to accelerate the refunding to our customers who are suffering from the airlines, in most cases, taking a long time to refund. In terms of our liquidity, cash performance was better than in Q2, the previous financial year. Our liquidity position at the end of September and October stood at $115 and $117 million, respectively, and is higher than March and June figures, excluding the acceleration of the reimbursements. The main reasons for this development is the high variability of the cost structure and good fixed cost management. This was offset by proactive decision to accelerate the reimbursement of our customers versus inflows received from suppliers. and a decrease in bookings due to higher travel restrictions. Combined, these create a working capital outflow. We have reduced our average monthly cash burn, excluding working capital and taxes, from €13 million to €6 million. And we have a strong liquidity reserve. Our no-action stress test implies we can run the business at current booking levels through the end of 2021. And as we have highlighted in our July and August results presentation, we are using this period to improve our strategic positioning. Specifically prime is shining during these tough times. Prime subscriptions and share of total bookings continues to grow. Prime members in the second quarter of FY21, reached 664,000 members. That's a 71% increase versus the same period the last financial year. Share of bookings, or share of total bookings, reached 26% in Q2 of this year versus 7% in Q2 of the last financial year. Prime is proving to be a successful proposition to customers, even in this current depressed market, with 100,000 new subscribers alone in Q2 of this financial year versus just Q1 of this financial year. And we are on track to reach 2 million subscribers by 2023. In terms of current trading, The short-term outlook is largely outside our control and driven by travel restrictions and COVID-19. October and November numbers are showing minus 67 to minus 73% bookings growth year on year. It remains impossible to predict the future with any accuracy given the uncertainty around COVID-19 and travel restrictions, and therefore we continue to offer no guidance for this financial year. Now I will go through the points I have just mentioned in more detail in the following slides. Please turn to slide five, in which we cover our diversification revenue KPIs. Overall diversification revenue is proven to be more resilient than classic customer revenue during these times. And our product diversification ratio and revenue diversification ratio have both improved. the product diversification ratio increased from 80 to 87 percent, a seven percentage point improvement in a single year. Similarly, the revenue diversification ratio increased from 48 percent to 56 percent in Q2 FY21. That's an eight percentage point improvement again in a single year. Please turn to slide six, which demonstrates the progress made against our other three KPIs. On an annualized basis, and to be expected, our customer repeat booking rate decreased due to the spread of COVID-19. This is reflected in the strict way in which we calculate this ratio. However, Q2 performance improved meaningfully versus Q1 FY21, and is three times greater, moving from 7% to 22%. This has been mainly driven by the success of Prime as a customer proposition. As a result of COVID-19 situation, which is distorting the relevance of this KPI, we have decided to discontinue the reporting of this KPI till further notice. Also, we have really stood out in terms of mobile yet again, which bodes well for the future. In the last five years, bookings through mobile have risen exponentially from 18% of total bookings to 57%. We have always prioritized and focused on mobile and have led the industry in Europe. Now, in a post-COVID-19 world, mobile will become even more important, which is demonstrated by almost 60% of our bookings are now actually completed on a mobile device. Lastly, on KPIs, let's look at the changes to the Acquisition Cost for Booking Index, which improved by 48 percentage points year on year. This is due to the adaptability and flexibility of our business and the fact that more than 80% of our costs are variable. However, I want to make it clear that this very low level is not sustainable for the long term. As travel restrictions ease, we expect to spend more in online marketing, and this ratio will trend back to more normalized levels. If you can now turn to slide eight, let me brief you on our current trading to date and what we have done to improve our strategic position during the pandemic. Current trading shows that short-term outlook is impacted by travel restrictions. We have seen this by the rapid rebound in bookings during the summer. As travel restrictions eased, trading improved from the April trough at minus 96% to minus 59% in August. This is positive in that in a matter of months, a large portion of the market returned in a very short period of time. Towards the end of the summer, there was a return in Europe to increasing COVID-19 cases with further travel restrictions imposed by some governments. This has reduced bookings to minus 73%, which has stabilized more recently. In comparison to the market, our trading suggests outperformance against airline industry, gaining market share versus supplier direct due to better quality, more comprehensive content, and flexibility, and a focus on leisure travel. Please turn to slide nine, where I update you on trading outlook based on analysis from the IACA economics team published on the 29th of September. The good news is that the leisure customers are still willing to travel if allowed. We saw this in the summer, and we strongly believe that any further lifting of restrictions or the introduction of a vaccine is likely to result in a sharp rebound again. the announcement of Pfizer-BioNTech and Moderna vaccines, as well as the AstraZeneca announcement this morning, and eight other companies in stage three trials, all of this brings forward scenarios of travel returning sooner in 2021, which will favor more leisure travel companies like ours. Before the latest vaccine announcements, IATA surveys suggest that over 80% passengers will return to air travel within six months from now. Russia recovered to pre-crisis levels due to the news about its vaccine, and China is only 20% below pre-COVID-19 levels due to strong domestic demand. Please turn to slide 10. We are pleased to continue to report strong liquidity. consequence of our strong business model and active management of the situation. We have achieved this despite increasing travel restrictions and the acceleration of reimbursements to customers to protect our brand. Given our strong liquidity position, we made the proactive decision to accelerate reimbursements to customers versus inflows received from airlines. which resulted in 40 million cash outflow during the quarter. This resulted in liquidity positions of 115 and 117 million euros at the end of September and October, respectively, both of which is higher than March and June figures, excluding acceleration reimbursements. We have achieved this through four things. One, high variability of the majority of our costs. Two, fixed costs and capex were reduced. Three, obtaining additional financial resources of 15 million euros from government-sponsored loans due 2023. And four, by reducing our average monthly cash burn, excluding working capital and tax, from 13 million to 6 million euros. Furthermore, our no-action stress test shows we can run the business at minus 70% bookings year and year through the end of the calendar year 2021. The minus 70% is our average booking performance from March through October. It is important to note the conservative nature of this no action stress test calculation. It assumes we take no action on fixed or variable costs. None. No improvement made to working capital, nor any improvement in our business whatsoever. If you can now please turn to slide 11. I'm delighted to talk to you about the success of Prime as a customer proposition. Prime is performing strongly in this weak market. the number of subscribers has continued to improve and has risen by 100,000 in three months from Q1 to Q2 of this financial year, despite all of the market conditions. As you can see on the right-hand chart, Prime subscription rate and share of Prime continues to grow. Prime members in Q2 of this financial year grew 71%, versus the same period last year. That's a growing from 389,000 subscribers in Q2 FY20 to 664,000 subscribers in FY21. And the prime share of total bookings almost quadrupled from 7% in Q2 FY20 to 26% in FY21. In addition, we launched Prime in new markets UK most recently in November. We also launched new products, launching hotels in four of our largest markets being France, Italy, Spain, and Germany. Also, I'm pleased to say that in our most recent survey with over thousands of responses from customers, prime customers showed good levels of customer satisfaction, equal or higher than pre-COVID-19 levels. If you can now turn to slide 12, let me brief you about what we have done in customer service to be on the side of the customer. First and foremost, during these times of high airline cancellations, we have focused on the customer. To have this is a key competitive advantage and to encourage customers to come back when travel restrictions are lifted. These are some of the key highlights on our canceled flight management. One, 92% of canceled flights have been resolved and are processed. Two, we have invested in significantly increasing our contact center capacity. Three, we have developed automated flight cancellation identifier, which automatically identifies canceled flights and proactively informs customers through all possible touchpoints and proposes options to the customer. Four, we've contacted all customers who apparently have a solution, e.g., they've gone directly maybe to the airline, just to ensure that the customer really has a solution. Five, we have informed customers of long lead times by airlines and, where possible, propose a voucher as an alternative, but always allow customers to choose between a cash refund and a voucher. We want to be on the side of the customer as their advocate and agent. Six, implemented automated processes that provide our customers near real-time updates on the status of their refund requests. And seven, we've accelerated the reimbursements to customers versus inflows we receive from airlines for those cases where we know future cash reception from the airline is guaranteed. I could go on, but let's suffice to say that we have taken and continue to take actions to help our customers and put us on their side. If you can turn to slide 13. Let me conclude my part by summarizing what are our three key top priorities at the moment. One, Prime. To introduce Prime in more of our markets. expand to other travel services, and improve its effectiveness. Two, connectivity. Improve the quality of the content by building a content agnostic platform, which will facilitate taking content from many providers and taking even different content. It could be trains, air content, et cetera. And three, customer service automation. implement an automated customer service system, which is volume agnostic, so if there were much higher levels of customer demand, the system can automatically handle it with high levels of satisfaction. We'll now hand you over to David Elizaga, who will take you through our consolidated results.

Thank you, Dana, and good afternoon, everyone. If you could all please turn to slide 15 of the presentation, I will take you through the financial results in more detail. Clearly, the pandemic had a significant impact in Q4 of last year, and this has continued into the first six months of the current year. Let's outline the financial performance during the second quarter of our fiscal 21. Looking at the income statement, for the second quarter of fiscal 21 on slide 15, revenue margin decreased by 75%. This was due to a decrease in bookings of 62% and lower revenue margin per booking, driven by lower average basket value of bookings due to COVID-19. Customers are booking on average with less passengers per trip and to destinations closer to their homes. As a result, the revenue we get from providers is smaller, and the classic revenue we get from customers is also lower. When travel patterns return to normal, we expect revenue margin for booking to increase from its current level. On the cost side, variable costs decreased by 75%, which is the result of the adaptability of our business model to the new mix of bookings made by customers during COVID-19. Again, when travel patterns return to normal, we expect the variable cost of booking to increase from its current level. These dynamics resulted in marginal profit of 11.5 million euros positive. Marginal profit, again, is revenue margin minus all of the variable costs. Those 11.5 million are 10 times the amount of the first quarter. increasing the variability and flexibility of a cost structure. Fixed costs decreased by 31%, driven by a decrease in personal costs through a temporary employment reduction, as well as IT and external fees IT saves. As a result, the second quarter adjusted EBITDA amounted to a loss of 2.1 billion euros, which is 86% better than it was in the first quarter of this fiscal year. If we continue down the income statement, you will note that EBITDA amounted to a loss of 3.6 million. This was primarily due to adjusted items in line with the same period of last year. Full details of the adjusted items can be found in our condensed consolidated interim financial statements and in the Excel file that you can find in our website as well. The DNA and impairment increased by 29% relating to the increase of the capitalized software finalized in March 20. Our overall financial loss decreased by 10%, mainly due to the foreign exchange differences, partially offset by the increase in interest expense related to the use of our revolver and the new government-sponsored loan due 2023. The income tax expense amounts to 1.3 million in the second quarter, which compares with an expense of 3.3 in the second quarter of last year, mainly due to lower taxable profits compared with a comparable period, the write-off of certain deferred tax assets relating to tax-loss carry-forwards in the UK, and no movement in the provision for income tax risk, and no recognition of a deferred tax asset for part of the second quarter of 21 tax losses. Finally, adjusted net income stood at a loss of 19.3 million euros. We believe that adjusted net income better reflects the real ongoing operational performance of the business. Full disclosure of the adjusted net income can be found in Section 7 within the condensed consolidated interim financial statement . Turning now to slide 16, I will take you through the cash flow statement. In the second quarter of fiscal year, despite increasing travel restrictions and acceleration of reimbursement to customers by 40 million versus the inflows received from airlines, partially mitigated by higher volumes in September versus June, resulted in a working capital outflow of 1.8 million euros in the second quarter of fiscal 2021. The group continues to have a strong balance sheet, with liquidity position of $115 million at the end of September, including the $40 million acceleration of reimbursement to customers versus the inflows received from airlines, $106 million undrawn from a super senior revolving credit facility, and the $15 million new government sponsored loan to finance the decrease of negative working capital, placing us in a position of strength as soon as normal activity resumes. The cash position net of overdrafts stood at 0.5 million at the close of September. The cash performance in the second quarter of fiscal 21 was driven by net cash from operating activities improved by 12 million euros, mainly reflecting the working capital outflow just described, and income tax paid, which increased by 4.2 million from 0.9 to 5.1, mainly due to the fact that there were no income tax payments and taxable profits, but we had an advance payment in respect of an administrative procedure against the Portuguese tax authorities. There was no income tax payments and taxable profits. There was a decrease in adjusted EBITDA by 31.2 million, following the decrease of bookings. And we experienced an outflow in non-cash items of 3.3 million euros, when last year we had an outflow of 2.7 million. The driver of this quarter is that costs linked to COVID-19 flight cancellations were provisioned in the year end of fiscal 20, but the outflow of that provision has happened during the last two quarters. We have decreased cash used for investments by 2.5 million from 6.9 to 4.4 due to the implementation of cost-saving measures to minimize the temporary impact of COVID-19. Cash used in financing increased by 40.3 million euros from 12.9 to 53.2, mainly as a result of the repayment of 54.5 million of the revolver offset by the drawdown of the new 15 million government sponsored law. I will now turn the presentation back to Dana to do the closing remarks.

Thank you, David. Turning to slide 18, let me conclude by giving you a quick recap of our overall view. We believe we are positioning ourselves for real success in the post-COVID-19 world. The strength of our finances, the adaptability of our business model, with the vast majority of our costs being variable, and the mitigating actions taken during the pandemic allow us to emerge strongly and well positioned from the crisis. Our liquidity position at the end of October was 117 million euros, including acceleration of reimbursements to customers, which could be used if needed in periods of slowing demand. Gross leverage ratio being waived for fiscal year 2021 gives us further financial flexibility. We have no short-term financial debt payments. And our senior notes, new government-sponsored loans, bank facilities, not due until 2023. The Prime Subscription Program is growing even in this poor market under extraordinary conditions. We have added 100,000 new subscribers since the end of June, and the share of total bookings reached is 26%. That's four times more than the share in the same period last year. We have kept our teams intact and motivated to compete vigorously and serve our customers well. We are a leader in mobile, product quality, and revenue diversification. And we are a true innovator in terms of subscription and customer proposition and experience. And we focus exclusively on the leisure travel consumer in markets that have shown a good ability to respond rapidly when travel restrictions start to ease, which following the news of Pfizer, BioNTech, and even AstraZeneca's vaccine, we hope this is a not too far distant future. Thus, we believe our future is bright. We will emerge a winner through these unprecedented times. With that, I would now like to take your questions. We will answer the questions sent to us in writing in the webcast. We will take questions on a first come, first serve basis, but we will also try to group questions of similar nature. Should we not have the time to respond to all of the questions from the webcast, the investor relations team will make sure those are answered afterwards.

Okay, thank you, Dana. I will start reading the questions that come to us through the webcast. The first set of questions, because there are three of them, come from Chad Garcia of Schwartz Investments. The first one says, it looks like X customer reimbursements, liquidity would be 157 million, versus 167 at July. Is that correct? Yes, it is correct. Those would be the numbers, and it would compare as well to 132 in June and 144 in March. So adjusted for the acceleration in the reference to customers, the liquidity would be 157, and that would be higher than June at 152 and March at 144. The second part of this investor says, can you provide year-on-year revenue changes by month for the quarter? Unfortunately not. We cannot provide this. But if I guess where this question is coming through, I would say that if you're interested in modeling liquidity, a much better proxy for the movements in liquidity is the bookings rather than the revenues because the revenues have movements from month to month that depend on provisions or adjustments to previous provisions and therefore is not such a good predictor of the movement in the cash as the bookings themselves. The third part of this investor says, any thoughts on the jump in mobile bookings as percent of total bookings?

Let me take that, David. There's first just two parts of the context. Part one is that we have historically prioritized mobile. Not all companies do that, but we have from early on said that we first and foremost want to develop for mobile and then for others, as opposed to many other companies doing actually the exact opposite. And so you've seen over time we really have made meaningful improvements in mobile. And it ebbs and flows from one quarter to another, and it really depends upon how much of our ideas much more specific to mobile only as opposed to translating between mobile and a desktop device so to speak and so that's why did you find some variability in the continuous increases of ours of late more of our releases have been more focused really on the mobile based solutions coupled with the fact that I think in the COVID-19 situation, more people are reaching to mobile, more of these types of customers feel comfortable on a mobile device in doing bookings on a mobile device in these types of market conditions. I still believe for the future, overall, it's going mobile no matter what. You can't go around that. The extent to which the acceleration will happen like in the past quarter is yet to be seen. David?

Okay. I'll follow with the next question which comes from Tom Gibney of BNP Paribas. The first question is what would you expect the working capital outflow in the third quarter to be if bookings were maintained at current levels for the rest of the quarter? Now, that is not such an easy question to address. And I'm going to presume that when you say current levels, you mean current year-on-year performance, okay? And there is a seasonality pattern by which normally, and absent any rise in last-minute bookings in December pre-Christmas, normally November and December are seasonally lower than September and October. So by keeping the same level of year-on-year performance, you would actually have a decrease in the absolute number of bookings. The rule of thumb is that around, and we said this before, around a 10% year-on-year gap would result in about a 20 million outflow or inflow, depending in which direction it moves. And I think we would be below the 10 points. So probably a range of around 15. But as I say, there are many moving pieces in the cash as well. What happens with the refunds from the airlines? How much do we accelerate or not accelerate versus the customers? So take this as a very directional response, please. The second question from this investor says, why have you reduced cash to quite such a low level? Well, the reason is that we have about a third of our revolver credit facility which has ancillary overdraft facilities. So we just can draw down immediately from the current accounts and just overdraw from them. And we're trying to be really, really optimized around every cost in the company, including the interest costs. And by doing this, we pay less interest on the debt that we're using. And the third part here says, do you have a sense of how your share of the overall OTA flight bookings market developed over the stronger booking period in July? And I think Dana's probably got a position to respond to this one.

Yeah, there's two points. The first one is just in terms of the data. There isn't, let's say, an easily verifiable market statistic that we can point to for this measure. However, we invest significantly in our own proprietary information in order to be able to come up with an assessment of what it is. And it does look like we've been taking market share, you know, during the summer months and even actually continuing into the autumn. All indicators that we see at least are definitely favorable to us, absolutely. I do want to qualify that one thing. We are not focused on, you know – I mean, 100% of our energy is not focused on winning in the current market, right? The current market at minus, you know, 73%, minus 60% is not the real market. The real game is next summer, right? The vaccine is coming out. People are coming back to travel. And we want to make certain that we are the company of choice for that market, right? And so that's why so much of our teams are focused much more on long-term propositions, on making certain, for example, on prime, right, and making certain that prime is really great. Now, we've seen the potential of it, but we have a lot more to come and a lot more to do on prime still from it, and that's what we're focusing on. On the customer service, you can see how we're focusing on the customer and making certain that we keep a good rapport with our customers and good brands, for when travel really does pick up as well. And we also have the customer automation project. And then the third area is around our connectivity. Again, not necessarily a short-term payout, meaning right now current trading or the summer trading, but absolutely a longer-term payoff for us in that. And so hopefully that gives you context of not only are we taking share in the short term, but we're really focused more on winning as the market returns to a much more normalized market. David?

Yeah. Thank you, Dana. I will go then to the next question. The next question comes from Lenny Sienkowski from Eaton Bands. Dana mentioned acquisition cost per booking will return to more normalized levels post-COVID. What do you consider a more normalized level and what are some of the global travel recovery targets you would look to when assessing when to restart marketing spend? So there are two parts to this question. The first one, what is more normalized levels post-COVID? The more normalized level would be the level pre-COVID. So you would need to look at our third fiscal quarter of fiscal 20 or the fourth fiscal quarter of fiscal 20, although that one already had about six weeks of COVID effects, so probably the third quarter is the better indicator. And I would take that level, and over time, that level should decrease somewhat, because as the percentage of our bookings from prime members increase, and given that the prime members tend to repeat in cheap channels of acquisition, then they will have a positive influence in reducing the acquisition cost per booking of the aggregate of the company. And the second part of the question that says, you know, what global recovery targets we would look at when assessing when to restart marketing spend. The way our platform works is actually more automatic than that. It's not like we're going to give an executive order from the boardroom saying, now it's time to restart the marketing spend because we see that the economy is doing X, Y, or Z. Our platform automatically assesses the probability of revenue of each search that we get, and based on that, it automatically assesses how much to pay for performance marketing. So it's something that happens automatically in the platform. That's one of the reasons why it is so flexible on the way down as well, because there are machines doing it automatically. I look now at the next question, which comes from Martin de la Concha of XIG Capital. It says, revenue in the third, well, it mentions the revenue for the last four quarters. And it says, in the fourth quarter of fiscal 20, we saw 100 million unwind of working capital. Why did working capital not unwind even further in the following quarters as revenue decreased? How is it possible that negative working capital buildup in the first quarter when revenues have decreased to $16.6 billion. Well, I think here I'm going to quote myself a little bit earlier today in that revenues are not a good indicator for the evolution of the working capital. Bookings is a much better indicator of the movement in the working capital. And you will remember that in the last six weeks, of fiscal 20, so two weeks of February and four weeks of March, there was a very dramatic drop in the number of bookings. And we pay on average to our airline, which is the principal provider for working capital inflows, on a two-week period. That means that when there is a reduction in the number of bookings, the unwinding of the working capital happens just two weeks after. So already in the month of March, it was when we suffered the biggest drop in our working capital. Then after that, as bookings started to improve, even if the revenue year on year for that particular period was a big drop, as long as you have more bookings than in the period prior, you are going to be receiving an inflow of working capital and vice versa. So this is the way that you need to look at our working capital movements. The next question comes from Jonathan Morgan of CQS Management. And it says, what are you seeing so far in November as European lockdowns restrictions have become effective?

David, let me take that one. Overall, I think the market has stabilized pretty much. So, in November, our average is around 73%. There's lots of variabilities on it today, and that's normal, even without COVID, so to speak. So, it's much more important to look at it on, let's say, an overall, let's say, week or several weeks basis. It really has stabilized on that. We don't see any deterioration at least for right now where we are in November. Again, I cannot predict the future, you know, from a short-term point of view about it. But overall, it seems to have been stable. David, anything you want to add on it?

No, I think you've covered it. Let me go then to the next question from an investor, which comes from of OdoBHF. And it says, do the accelerated reimbursements lead to high credit risk given the financial situation of airlines? Thanks. And the answer to that question is no, because we do the acceleration when we already have certainty that the airlines are actually going to refund us. The way the process works in trying to summarize a lot is we process with the airline the refund and at some point through the different information systems airline by airline, there's a moment in which they approve a certain refund of an individual booking and we receive that signal. But the actual cash, we receive two to three weeks later depending on the methodology of cash transfer. So when we accelerate is for refunds that have already been approved but where we didn't receive the cash already and therefore we suffer no credit risk. There's the next analyst that is asking is Carlos Treviño from Santander. And it has a few questions so I'm going to take them one by one. It says, could you elaborate on the evolution of your liquidity position in August and September? It dropped from 167 million in July to 116 in September. Even considering 40 million in reimbursements to customers, I would have expected a positive contribution from working capital in those months due to the recovery in bookings. Minus 59% year-on-year in August, minus 63% in September, versus minus 63% in July. Okay, so let me tackle that one. In August, there was certainly an inflow in working capital because the number of bookings was higher than in July. In September, there was, however, an outflow in working capital because the number of bookings was lower than in August. and therefore you have one movement in one direction, another movement in another direction. However, you also have other things happening during those periods. You have the $40 million outflow, which happened mostly in August and September, and you have noted that. That will really take you from $115 to $155. But, for instance, the payment of interest, the payment on the bonds, happens half yearly, and it happened in August for $12.9. You also had outflows during the quarter of things that we had provisioned in the books in our March financial statements. So when we took provisions for GDS incentives, returns, and other type of revenue from providers, those we took the provision in March, but the actual outflow happened partly during the first quarter and partly during the second quarter. So there are many moving pieces in there. Not to try to make the answer super expensive, I'm happy to give you additional further detail in a one-on-one meeting afterwards. The next part of your questions is, could you explain in more detail the dynamics behind the severe year-on-year drop in variable costs for booking, especially considering that the acquisition cost for booking is likely increased sequentially to 52 from 48 in the previous quarter. Okay, on that part, just as a reminder to everyone, within the variable costs, you have several components. You have the acquisition cost, which is the bigger one, but you also have the call center costs. You have merchant costs. and you have other variable IT costs per booking. So it is effectively the other elements of the variable costs that have performed significantly better in the second quarter versus the first quarter. Several reasons here. One, the call center cost is variable. That is variable. over a longer period of time because it means that you put more or less positions into the call center. With a level of bookings in the second quarter, which was about three times the level of bookings in the first quarter, we're not increasing the cost of the call center, but on a per booking basis is meaningfully lower. In terms of the merchant cost, the merchant cost is a proportion of the actual Euro amount of the bookings. We made reference during this call and in our presentation that we have seen a different mix of bookings in which customers are booking less passengers per trip and customers are booking to destinations closer to the homes. That results in a lower Euro amount of the basket. When you have a lower Euro amount of the basket, you also have a lower merchant cost per booking. And in terms of the variable costs of IEP, we're doing a very fine job, I would say, at reducing them even more. And within the variable costs, especially when you do the comparison year on year, you have a situation which is that certain of the revenues that we did not collect, for instance, you know that we discontinued the service of cancellation for any reason in January when you do the year-on-year comparison, you don't have that revenue, but you also don't have the provision for cancellation of bookings that we used to collect. Let me move on to the other questions from the same analyst. Could you elaborate in your plans to improve the quality of your contents?

Yeah, happy to do that, David. Let me divide it into two parts, two types of content. The first one is air content. We are investing in getting air content from more types of sources. And so you could imagine that. You know, there's many different types of sources, so we could get them from more GDSs and also pseudo-GDSs. And so it just simply requires a set of developments that we would do in order to be able to get that and then optimizations on that and setting certain types of rules in order to extract it in the best possible manner. And that also allows us to trade off one source versus another source's content to see which would be the best for us. And so that's a number of things that we're investing in on those things. We can obviously absolutely also direct connect with some airlines and we have the resources and scale to be able to do that. And so that's some things that we are actually considering doing. When we believe the conditions are right for us, we would consider to do that. And if not, then we do it through other sources. And then the The second part would be the non-air types of content we're also investing in. So, as you know, for example, we go directly to hotels, and we have our own content that we ingest at hotels, and we continue to expand that, particularly in this market. There's other types of content as well. Beyond that, you could imagine trains or other types of ones as well that we do start to ingest within our platform as well, and that just provides ourselves our customers and our shareholders more optionality around our business going forward in the future. David?

Yeah. We still have a few more questions from Carlos. Would this mean that you could go through more NDC interviews direct connections with airlines on top of your current ones with American Airlines and your sponsor?

Yeah, so again, I tried to address that in the previous question, but it means that we could. Again, if the conditions are right, you know, and we believe that there's a good win-win here, then we would, absolutely. There are, though, many paths and many ways of getting content.

And then the last one is, last one from Carlos, is you wrote off certain deferred tax assets in the UK in the quarter. Do you see risk of further riders in your asset, in your tax assets? And simple answer, no. The next question comes from Juan Benia of GDC . Good morning and thank you for taking my question. I know that there is not much time to analyze it, but I would like to know if you see any significant increase in the number of bookings since the announcement of first Pfizer and after Moderna, the good results in the vaccine studies. Could you give us any figure of that? I think that Dana already answered this when he talked about the training of November. So I just referred to that answer before. The next set of questions come from Nisla Neiser from Deutsche Bank. First part is, on the accelerated reimbursement, how confident are you that suppliers will reimburse you? Well, I think I've addressed this question previously from another investor. Have you stepped up marketing to prime? Are you offering any new options to help drive the acceleration that we are seeing in the subscriber numbers? Have you reduced the price of the subscription? Dana will take this one. Thanks, David.

We are not currently really investing in marketing, and I think you see that also by kind of our, you know, acquisition cost index where you see just the absolutely dramatic drop in it. So I can confirm that, you know, we're really not spending money on marketing. I think that what's happening is a couple of things, one of which is really Prime is very successful. And particularly now in these tough times, you know, in the COVID market conditions, We see some really good relevance between the customers and our proposition. One is the prices are great in Prime. And so if you think about it, people are struggling economically and will be struggling for quite a while. And Prime offers just amazing prices. And I'm not just talking about on air, but on hotels as well now. We've rolled out hotels. So when you think about your total trip, right, to go someplace, right, you know, Prime offers amazing savings to people. The second is with the uncertainty within the, you know, the airline industry and with COVID-19 and people wanting to cancel, most of our bookings and offers are flexible, right? So, they offer some form of flexibility of change in it. And customers, depending upon how they want to contact us, Prime customers, we offer, a special customer service just for prime customers that, in a sense, they go right to the front of the queue. They have a special prime team. And so their answer rate is phenomenally quick. And so just the combination between price, between flexibility, And service, you put those three together, and customers really, really like that. And we see that in our survey results, which I tried to touch on a little bit in the text of my presentation, where, you know, the survey results are really, really strong in terms of customer satisfaction. So that's what I believe it really is down to, much more than that, and we haven't been doing marketing. Now, in the future, as the market would come back and take off, it absolutely does allow us to be able to do much more around the marketing front in the future. David?

Yes. And the last two questions from Nisla are the first one, reduction in variable costs. What are the measures you have taken specifically to lower this? I think I've responded to this already. How much of this decline would continue next year? Well, the portions of this that will return, as I was saying, to start with on the acquisition costs as the revenues increase, I would expect the acquisition costs to increase. And on things like the merchant cost, as the average basket value returns to normal levels, then I would expect those costs to increase as well. Have you had to restructure your employee base? And the answer is no. We are taking some measures as allowed by regulators to reduce working hours and pay. from our employees. Currently, it is, employees are only losing 10% of their salary, but we have not restructured anyone. Which markets were the most?

David, just to be clear, not all employees. We have a big portion of our employees on 100%. So it's only a portion of employees, actually. And I think we've taken this decision to really make certain that, you know, a couple of things. One is trying to find a win-win, meaning from our customer's point of view to have people really focus on working on making sure that we really serve our customers right. And so we've moved lots of people around, you know, to make sure that we're on customer-related items. The second is also to making certain that we're building for the future as well. and for when the market really comes back, and doing this in such a way that is right also with our values within the company. And we have a highly motivated edu culture within the company. David?

Yeah, the last part from Nisla was which markets were the most resilient in Q2? And the answer to that is that the Two markets that performed better than the average of the rest of the markets were France and Italy during the second quarter. The next question comes from, again, Tom Givney of BNP Paribas. Will the 40 million acceleration of customer refunds effectively reverse as refunds are fully worked through and airlines pass cash for these to you? Well, actually what we're seeing in the market is that the dynamic of cancellations that give rise to the need of a refund has continued after the first wave. There was a big chunk of cancellations in March and April in which virtually almost 100% of the flights were canceled. But ever since then, the airlines have continuously gone on a dynamic of scheduling more flights than they're actually effectively flying afterwards. So, the cancellations keep coming in. And so, therefore, we will have to, let's say, service our customers appropriately with the dynamic in continuation. The next question comes from , private investor. With low levels of cash and equivalents, do you consider drawing from your credit facilities, and if so, how much? I would say that this is a very, very dynamic situation. And we draw and then draw, like the word says, this is a revolving credit facility. So we draw money and return money on a very frequent basis, so several times during the month, according to the cycles of inflows and outflows. When do you expect to reach normal levels of activity? Well, I think the answer to that is depending on the evolution of the pandemic and the restrictions to the liberty of people to move around and travel. So I cannot really give you a specific answer. We have a number of scenarios, and we monitor the situation on a continuous basis and manage according to those. The next question comes from Frederick Sundberg of Tresidor. Please, could you clarify your statement, no action stress test, suggests we can run business at minus 70% through end of calendar 21. What does this mean from a cash flow perspective? Well, what it means from a cash flow perspective is that the way we run the stress test is that we take no further management action versus what we are doing right now. So the only thing that we input into the model is that level of continuous decline of 70% on a month-by-month basis versus those same months before the pandemic, so in 2019. So we do not cut further fixed costs. We do not cut further the capex, and so on and so forth. That's what no action means. Will you be cash flow neutral including working capital and interest at these levels? Well, the thing about the – if you're continuously at 70%, there's not much working capital movement. There is a bit according to the seasonality of the different months, but there's no working capital movement. Now, just to remind everyone, if you're at 70% and you come from 80%, there is a working capital inflow. If you're at 70% but you come from 60%, there's a working capital outflow. So actually, it's not a linear answer that we can give to this. It's unfortunately a much more complicated model to run. And there is another question from Anderik Klotz of Jefferies. Can you please explain the 40 million reimbursements and how confident you are in Ireland's paying you back this? I think we've answered this actually twice already. So the thought we currently have No other questions. And I think that we are going to then finish the conference call for today. Thank you very much for attending and for all of your questions. We would like to inform you before concluding that on Thursday, 25th of February, We will be hosting our conference call for the third quarter of fiscal 21. And in the meantime, we will be very happy to receive your questions via our investor relations team or the investor email address, which is investors at eDreams.EGO.com. Thank you very much. Thank you.