eDreams ODIGEO S.A.

Good morning, everyone, and thank you all for joining us today for our first quarter fiscal year 2025 results presentation for the three months ending 30th of June 2024. I'm David de la Roth, the Director of Investor Relations at Dream Sodillo. As always, you can find the results materials, including the presentation and our results report, on the investor relations section of our website. I will now pass you over to Dein Adam, our CEO, who will take you through the first part of the presentation.

Thank you, David. Good morning, everyone, and thank you for joining us today. The key takeaway from today's results is that EDU continues to show strong growth in Prime subscribers and cash marginal profit margin continues to build as the maturity of Prime members increases. In fact, cash marginal profit margin was up nine percentage points over the last year. to a margin of 45%. In addition, we added 409,000 subscribers in the first quarter of FY25 and are on target to meet our self-set targets for FY25. Today, we'll take you through the key points of our strong performance. This includes, first, the ETO results highlights. Second, the prime model continues to drive very strong growth And we'll review our strong first quarter results. And thirdly, we'll conclude today's presentation with some closing remarks about our long-term fundamental growth potential well beyond FY25. Please turn now to slide four. This is a summary of our performance for the first quarter of this fiscal year, 2025. As mentioned, our profit margins have increased significantly due to the strength of our prime model and the increasing maturity of prime members. This has resulted in prime cash EBITDA growing 71% year on year. Some of the key highlights for today's presentation are, firstly, in the first quarter of FY25, the strength of the prime model drove significant growth. and has guided improvements in profitability. Prime members grew 32% year on year, reaching 6.2 million with net ads at 409,000. We're on track to reach our three and a half year old self-imposed FY25 target. I remind you, as highlighted in the past, that we expect volatility on a quarterly net ads basis. Cash marginal profit stood at 60 million euros, and that's up 16% year on year. And the margin had a three percentage point improvement over a year as well. Cash EBITDA stood at 36 million euros, and it's up 23% year on year. And cash EBITDA margin had a three percentage point improvement in just over one year as well. More importantly, the free cash flow, excluding non-prime working capital, grew even more and stood at 20.4 million euros. And that compares to 15.2 million euros in the first quarter of FY24. This is a 5.2 million improvement year on year, which is an increase of 35%. Second highlight. The prime model continues to drive very strong growth. The growth in prime more than offset the anticipated declines in the non-prime side of the business and results in significant improvements in profitability. Prime cash revenue margin grew by 22% following the strong growth in members. Prime cash marginal profit grew 54% and the margin had a nine percentage point improvement in just one year. And prime cash EBITDA grew even more as we started to leverage a more scalable fixed cost base. Even with strong top line growth, prime cash EBITDA grew 71%, and the margin expanded nine percentage points as well. The third highlight is our outlook. EDU remains on track to meet the 180 million cash EBITDA target by members in excess of 7.25 million members. And we'll do it with the generation of free cash flow, excluding non-prime working capital of over 90 million euros, which means that this more than doubles versus fiscal year 2024. All of this growth is why we have faced many industry headwinds over the past three years. However, it's important to highlight that we expect to see better year-on-year comparatives in the second half of this fiscal year as we increase our member base and the maturity of our prime members increases. Year-on-year comparatives expect to be the following. Prime members in the first half of the fiscal year are expected to grow around 28% versus September 2023, and in March 2025 by around 24% versus March 2024. Also, cash marginal profit margins are expected to be around 36% to 37% in the first half of this year, and 42% to 43% in the second half of fiscal year, resulting in around 40% past marginal profit margin for the group for the full fiscal year FY25. Furthermore, I'd like to remind you that the CNMV, that's the Spanish Stock Exchange Regulator, approved on the 24th of July, 2024, our voluntary A partial tender offer launched for a maximum of 4,550,864 of shares representing 3.6% of EDU issued shares at a fixed price of 6.9 euros per share. The timetable for the offer has been announced. The acceptance period for shareholders to tender their shares started on the 29th of July, 2024, and finishes on the 6th of September, 2024. All concluded. Concluding the highlights with a comment about longer term. We've been building a long-term sustainable proposition and need to add a strong fundamental growth potential beyond FY25. Prime is significantly under-penetrated in main markets and can go to new markets. In sum, Prime's proven model continues to derive very strong growth. It has delivered significant uplifts in profit margins, and we believe that we have the right model, right people, and the right structure to seize and deliver on the exciting shareholder value-creating opportunities ahead of us. With that, now let me pass it over to David Alitaga, who will take you through some of the KPIs of our prime model and the strong growth and significant profit improvements in the first quarter of FY25 results.

Thank you, Dana. If you could all please turn to slide six of the presentation, I will take you through the prime model. Ethereum's profitability was up significantly due to strong growth of prime members in year 2+, and cash marginal profit margin reached 42%. Cash EBITDA also rose significantly, and we are well on track to meet our target of over €180 million in fiscal 2025. As guided, the growing numbers and maturity of prime members has resulted in strong improvements in profitability. In the first quarter of fiscal 25, our LTM prime cash margin or profit margin continued to improve. It increased to 42% from 34% in the first quarter of fiscal 24. That is an 8 percentage points improvement. Group cash EBITDA also improved substantially. In the first quarter of fiscal 25, cash EBITDA margin reached 19%. versus 16% in the first quarter of fiscal 23. This is an improvement of previous entry points. If you please turn to slide seven, let me remind you that with looking at prime versus non-prime, we still think it makes more sense to look at our business on a last-first-month basis, as prime is an annual subscription business, and the non-prime part is quite influenced by seasonality patterns. Our KPIs reported today show strong growth and significant marginal profit uplift. Cash marginal profit was up 23% over the last 12 months, as we have more Year 2 Plus members of Prime. Also, Prime's strong growth more than offset the anticipated declines in the non-Prime side of the business. We continue to be selective on how we spend marketing and we put more focus on Prime products versus developing products and services for the non-Prime side of the business. Edo is fundamentally a subscription model-led business focused on travel. Over the last 12 months, Prime has delivered 63% share of group cash revenue margin and 81% share of group cash marginal profit versus 50% and 59% a year ago. As we now have a much larger proportion of our prime members in the second year and subsequent years of membership cohort, the level of profitability of prime continually improves. If you could all please turn to slide eight of the presentation, I will take you through the financial results in more detail. In the first quarter of fiscal 25, we delivered a strong growth in cash EBITDA and substantial improvements in margin as the maturity of the prime members increases. In the first quarter of fiscal 25, cash revenue margin was 4% higher than in the first quarter of fiscal 24. Cash margin of profit and cash EBITDA improved 16% and 23% respectively between the first quarter of 24 and the first quarter of 25. Over the past year, our subscribers grew by 32% to 6.2 million and our ARPU grew 1.1 euros. In a context of consumer softness in Europe, as confirmed by several travel companies recently, we have given more discounts to our prime members as algorithms indicate it is better for lifetime value of those customers. As a result of all of the above, ARPU is expected to be around the mid-70s for the rest of the year. While speaking about our revenues, you will notice in the breakdown by type of revenue that gradual revenue is increasing while transaction day revenue is decreasing. There are three drivers behind this. The more important is the one already mentioned of higher prime discounts. But additionally, we are experimenting with higher tiers of prime that include services previously sold as ancillaries. therefore moving former transaction date revenue to gradual revenue. And lastly, it's important to note that our access to Ryanair content is intermittent. We have been dealing the intermittent access to Ryanair content now for over nine months, and our results already reflect this situation. We have the strength of our subscription business model continuing to deliver on material cash EBITDA and cash flow growth. On the Prime members, it is important to emphasize that Prime renewals have remained unaffected, as EDU and Prime continue to deliver exceptional value across nearly 700 airlines, millions of accommodations, and thousands of car rental providers. However, we acknowledge that customers solely interested in Ryanair flights are less likely to join Prime. Overall, it's fair to say that excluding this headwind, we would have materially exceeded our target of fiscal 25 prime members. Coming back to our first quarter overall P&L, 63% and 81% of our cash revenue margin and cash margin of profit in the quarter respectively are now for prime members. As guided, e-do profitability was up significantly due to strong growth of prime members in year two plus. Cash margin or profit margin increased to 35% for the first quarter of 25 from 31% in the first quarter of 24. Three percentage points improvement. Cash EBITDA margin in the first quarter of 25 also achieved very substantial improvements and stood at 21% versus 18% in the first quarter of fiscal 24. Cash EBITDA stood at 36 million euros in the first quarter of fiscal 25, up 23% year on year. Please turn to slide 9 of the presentation. Revenue margin excluding adjusted revenue items increased by 2% to €160 million. This increase was driven by the strong growth of prime revenue margin, which grew by 20%, due to strong growth in members and because prime ACPU increased to 76.6%. This strong growth in prime revenue margin, as anticipated, was partly offset by the non-prime revenue margin, which decreased 20%, versus the first quarter of 24, following the switch of our customers from non-prime to prime, and more generally to a focus on the prime side of the business. Variable costs were broadly in line with the first quarter of fiscal 24, despite the higher revenue margin, as the increasing maturity of prime members reduces acquisition costs. Fixed costs increased by 1.5 million euros, driven by higher personal costs and to a lesser extent higher IT costs, now that we have reached our recruiting targets. Fixed costs will grow less than they did over the last two years, and as a result, we will see more leverage of our fixed costs from now on. As a result, adjusted EBITDA was 22.6 million euros, that's 36 million including the full contribution of prime, from 20 million in the first quarter of 24. Adjusted net income stood at 2.6 million in the first quarter of fiscal 24. Turning now to slide 10, I will take you through the cash flow statement. In the first quarter of fiscal 25, we closed the first quarter with positive net cash from operating activities of 29 million euros as a result of the successful expansion of the permanent base, which resulted in increased EBITDA. In the first quarter of fiscal 25, we had a working capital inflow of 6.8 million, mainly driven by the growth of our business. The higher inflow in first quarter 25 versus 24 is driven by prime. We have ample liquidity and had room to deliver our plans, a consequence of our strong business model, cash generation, and active management. At the end of June 24, the liquidity position was strong at 228 million euros. We have invested 14.7 million in the first quarter of 25, an increase of 4 million euros as we capitalize our software. Cash used in financing amounted to 6.2 million euros compared to 5.2 million in the first quarter of fiscal 24. The variation by 1 million euros mainly relates to the acquisition of treasury shares for 4.8 million euros during the first quarter of 25, offset by the payment done in the first quarter of 24 of the government-sponsored loan for 3.8 million euros. I will now turn the presentation back to Dana to do some closing remarks. Thank you, David.