lastminute.com N.V.

Good morning and welcome to the lastminute.com full year 2025 financial results conference call. Today's call will be hosted by Julia Weinhardt, Head of Investor Relations, and joined by Alessandro Petazzi, Chief Executive Officer, and Diego Fiorentini, Chief Financial Officer. All participants are currently in listen-only mode. There will be an opportunity to ask live or webcast questions following the presentation. Please note that this call is being recorded. At this time, I'd like to turn the call over to Julia, Head of Investor Relations. Please go ahead.

Thank you, Mathilde. Good morning, everyone, and thank you for joining us today for our second call of the year. Today, we will present the final 2025 audited results as previewed in February. We have also this morning published our annual report and sustainability report 2025. These are now available on our corporate website. Along the results, we will share our latest development, and after the presentation, we will be happy to address your questions. With this, I will hand over to Diego now to start the presentation.

Thank you, Giulia, and good morning to everybody. Today, we released our full year 2025 audited results, fully aligned with the preliminary figures we shared earlier this year. This resulted in a solid supply and profitability growth. Gross travel value grew 19% across the board. Revenue rose 15% to $361 million, exceeding our guidance. Gross profit improved 10% even as we scaled up our marketing investments. At the same time, we saw a manifold acceleration in profitability. Adjusted EBITDA increased 33% to $54.9 million, well ahead of our upgraded guidance, highlighting strong operating leverage. And importantly, this performance converted into cash, with adjusted EBITDA less capex, doubling to $32.4 million. Overall, 2025 was a turnaround year, marked by strong growth, improved profitability, disciplined cost management, and robust cash generation. With that in mind, let's turn to the proposed dividend. The Board is proposing a dividend of 41 cents per share for approval at the AGM in June, consistent with last year's payout. While reported net profit was lower, this was mainly driven by one-off and non-cash items related to the disposal of the Grease business, which has been normalized. On this basis, the proposed dividend is fully aligned with our 30 to 35% payout policy and reflects the strength of our underlying cash generation. As Julia mentioned at the start of the call, our latest sustainability report is now also available and 2025 marks an important step forward in structuring our ESG approach. We have launched a new three-year sustainability strategy based around four key pillars, each closely linked to our business model. and long-term value creation. Ethical and transparent governance now extended across our value chain. Climate and environment protection, which includes our road map to net zero by 2050. People and community impact, focus on culture and local engagement. Our customer experience and responsibility to tourism, supporting better and more conscious travel choice. Overall, we are embedding ESG into how we operate, serve customers, and grow the business, strengthening resilience and long-term value creation. In the sustainability report, we are highlighting some important external recognition. In January 2026, lasmino.com received an MCI ESG rating of AAA, positioning us as a leader in managing ESG risk and opportunities within our industry. In addition, our inaugural disclosure of the Carbon Disclosure Project also saw the group achieve this score. This is a strong debate for our commitment to transparency and high-quality environment data disclosure. Together, this recognition validates the robustness of our ESG framework and are fully consistent with the discipline and quality reflected in our audited results. Overall, this demonstrates that we are not only managing risk effectively, but also positioning the business to capture some term opportunities. Let me now wrap up the key takeaways. We delivered strong 2025 results, fully in line with the preliminary figures shared in February. It was a turnaround year. We achieved double-digit revenue growth with profitability accelerating in second half and exceeding our full year guidance. Cash conversion was strong, supporting disciplined capital allocation and dividend distribution. Rigorous execution and focused effort drove these results, leaving us well positioned for 2026. With this in mind, I now hand over to Alessandro. Thank you.

Thank you, Diego. And just a couple more words about our 2025 results. Of course, they're not new. You had already seen them in February. But I think it's important to underline that we've been growing not only more than our guidance. We've been growing more than the markets. This is a reflection of the choices we've made throughout the year of the change we had in our approach to product, to marketing, to market expansion, and I would say in general to our strategy. So delivering top-line growth, but also strong cash flow generation, which is what allowed us to have the same dividend payout year after year. So we think it's important, as I said, upon joining the company, that it's important to prove that we can grow more than the market on the top line, but also having very strict and disciplined cost control and more than proportional cash generation. So I don't think this is a trade-off. I do think that we can achieve all of these results and actually we have achieved them in 2025 as part of our strategy. Now, clearly we're now focused on 2026 and the following years. And so talking about the strategy, I would like to give you a quick update on something that we're doing to, I would say, close the loop on all the strategic refinement that we've been doing over the past few months. So when I talk about owning the customer experience, you might probably remember that we've been talking many times already now about the fact that the company used to be a distribution platform, basically, with a pretty transactional approach, getting customers coming mostly from metastore channels such as Skyscanner and selling flights to them. Over the years, there's been a progressive transition towards being more of a provider of package holidays. And right now, we are really completing that transition. So you might remember that we've been discussing about our strategy being much more of a product-led organization, really focused on owning the customer experience, and I would say moving up the value chain in a way. So I'm not accepting to be just a distribution layer, but really being more and more in control and responsible for the customer experience throughout their entire holiday. Not only in the moment of booking, therefore, as we were used to be, but also from the booking to the moment that people go on holiday and during the the holiday itself. So this strategic transition, which we already discussed with you a few times, we felt that required also an adjustment into our own broader mission statement to reflect the new company that we have become. And I think it's important for companies in general to always start with the why, right? To start with the reason why we exist. I know that most of you connected to this call are mostly interested in financial results. The financial results are just a consequence of what companies decide to do, why they exist, what do they do for the customers, if they're able to provide real value for the customers. And so this is not just a sentence, but this is the way that we're going to, the guiding principle that we're going to use to make the choices that will shape our future. So that's why we have, you know, updated our statements in terms of purpose. So the purpose of the company is really to own the complexity of travel so people can discover the world. We know that travel is a complex world, but at the end of the day, we care about the value that we can bring to customers, which is really allowing them to have that peace of mind that they can focus on the fun parts of travel while we focus on the difficult parts of travel. And if this is the reason why we exist, What we want to achieve is to be the travel curator and companion, again, taking that responsibility. And internally, if we go to our mission, so how we will achieve this is by designing, delivering, taking responsibility for travel experiences so that people can travel with confidence. You will notice that on this page, you don't see the word technology. You don't see the word AI that now everyone kind of sprinkles everywhere as a buzzword. But I think that this is not because this is not important. This is crucial. But I would say it's how we do things is the underlying, you know, pillar. that allows us to deliver this value for the customer. But we really wanted to be adamant on the fact that at the end of the day, whatever we do must serve a purpose in the eyes of those who travel. And then how we do it, the complexity that is under the hood, the complexity of our technology, the fact that we are now using AI on all our processes, and we will share some more details about that as we did in the last presentation. We will also do that. with some announcement in the next few weeks and with some more details in our next investor call. But again, this is about the how we do things. This is the why. And actually, this strategy and this model also have, you know, consequence and direct impact on numbers on also the latest trading update. Because I'm sure moving on to the next topic, I'm sure that this is what is on everyone's mind, right? What is happening in the Middle East, how this is impacting the travel industry, and I'm sure that a lot of you have questions about how this is impacting our company. So I would say that I have good news for you here, especially compared to what we've been hearing from a lot of other companies in the space. So let's start with some data points, right? First one is that to date 17,000 bookings of our customers were affected by regional disruption in the Middle East. And that might sound like a lot, 17,000 bookings, but just please remember that every single year we have over 3.5 million bookings. help over 6 million people to travel every year. So 17,000 bookings is the amount of bookings that we typically sell during one and a half days of trading. This is to put things into context. This is the elements of disruptions and cancellations we've seen. And obviously, these have been concentrated in the month of March when the crisis hit. And going forward, of course, we are seeing and expecting much, much a smaller number. I would say it's almost like a one-off effect of March specifically because then clearly, you know, certain airlines stopped selling certain destinations. We also stopped selling certain destinations, and people stopped booking certain destinations. So in terms of cancellations, the big effect is the one-off effect in March. But then, of course, you might be wondering, well, yes, this is cancellation, so it's really tiny for you, but what about the month? I know that you've been hearing some traditional tour operators or even some online players saying, well, actually, we saw a decline in sales of 15%, 20%, 25%. Is that the case for lastminute.com? And the answer is absolutely not. So, actually, I can already anticipate we will, as you know, we will give full Q1 results at the beginning of May, but I can already anticipate that Q1 2026, we've been growing compared to Q1 2025. And, of course, January, February, more than March, but, you know, we've been growing. And even in March, we've been resilient. And why that? And I think, back to connecting that with the strategy, that this is a function of our model from a number of points of view, right? So one element of our model is that we have a lot of different source markets, all in Europe, but we're not concentrated on one market. We're not a UK-only player. We're not an Italy-only player. And this is very important in situations like this. The U.K. and Italy are the two markets that have been most impacted in terms of demand generation, mostly, I mean, from a practical point of view on certain rules specifically. For example, a lot of Italians were planning to go to Sharm in Egypt for their Easter holidays, and clearly that didn't happen. So if you are a player focused only on the Italian source market, obviously this is going to hit you badly. But in our case, thanks to the fact that we have, you know, Northern Europe, Germany, Eastern Europe, other models, France, other markets with different preferences in terms of destinations, and also a broad portfolio of offers so that demand can shift from certain destinations to others, we were able to actually absorb that. So, for example, as we can see on the page, destinations such as Spain, Portugal, and Italy have been growing over 10% year on year, compensating And to be honest, in the past few days, I mean, we've seen, of course, a decline in March of destinations such as Turkey and Egypt, which even if not directly impacted by the war, were perceived to be in a potentially risky position. The reality is that the very last few days, we've seen even these destinations recovering, as if there was, you know, a big moment of panic at the beginning, and then progressively people are gaining confidence again when they realize that certain destinations are not directly hit. But this is not the only thing. So our model, yes, selling mostly Europe to European travelers, so in a way being a bit insulated by all of this, but that's not the only thing. The other thing is that products, right? I mean, we, of course, We are, we said it, that the core of our business is selling package holidays, being an integrated travel provider, but it's not a coincidence that we still also offer flights only and hotel only as an option to our customers, precisely to be resilient in moments like this. And I'll tell you a bit more about this in a minute. If we take a look at the market from a broader point of view, there are some data that we've been also discussing with Google to just, you know, to expand the view from the data that we see for our customers and the data that we see for the market as a whole. Demand data, right? Letting aside how we can actually convert that demand. And for sure there have been a few changes. a few interesting effects. So pretty clearly, the timing shift that consumers are delaying purchase decisions, but they're not canceling. So we're seeing that there's like 17% of searches of people that are considering a holiday, but they've decided not to uh complete the purchase now they will say well actually i will complete my purchase for sure but i will complete it in the next in the next few weeks so people that normally would book in march saying well maybe this year i'm gonna book in in may or june um people who say well actually i've been planning But I'm still not sure, you know, if I want to go ahead, I will decide later on. So that's the key thing. And by the way, I think that in this context, our brand positioning as lastminute.com can actually come pretty handy because we expect that, especially for the holiday plans for summer, Clearly, having a last-minute booking will be something that will come naturally our way. The second element in terms of demand is the fact that we've seen a shift in searches from packages towards standalone flights and hotels, especially in certain source markets. People are like, well, rather than committing now to a package holiday, I will maybe drive my car at certain destinations and and book just the hotel or i will fly you know for for a city break rather than uh going into a summer holiday destination already for easter so a lot of people that were planning for easter being also pretty early right this this very weekend um they said well actually maybe uh flight only makes more sense for me in this phase well and again the beautiful model is that we can we can serve those customers as well. And this will be reflected in our Q1 results. So, but our flight only business is doing very well precisely for that. And again, it's not a coincidence, right? I mean, I got a lot of times from, also maybe from some of you on this call, the question, well, if package quality is your core business, why do you keep offering those flights and hotels only, considering the added complexity that this has? And of course, being on multiple source markets, providing multiple products adds complexity. And as I said a few minutes ago, we have to own that complexity because that complexity, if we manage it well with the technology, with AI, and we make it simple for our customers, is exactly what makes us also resilient in situations like this. Last but not least, we're seeing that because of the current situation, trust and flexibility, which are always important components when booking a holiday, are becoming even more important as the risk mitigation factors, you know, even more than price in the current moment. And we're doing something about this because, again, I've been talking about market trends, but let's not forget that we are managing the company. We're not just kind of passively managing. uh accepting whatever trend the market the market offers we're proactively engaging and changing the way we operate to leverage the new situation so for example we've changed over the past few weeks our marketing approach by obviously focusing on certain destinations and on certain products rather than than others that we would normally be focusing in in march and april so that's one thing we've now testing a new canceled for any reason product. So, you know, kudos to our product team that very quickly could come up with a product canceled for any reason, which is precisely tailored for the type of an anxiety That is now very plain travelers. We're testing in a few markets and see, obviously, if we can roll it out progressively to other markets very soon. Clearly, not including Middle Eastern destinations. I mean, needless to say. But, again, even in destinations which are completely not impacted by the current situation, people have this, want this peace of mind, and we are there precisely to offer that peace of mind. So, for example, also to promote refundable rates of hotels, you know, more than the non-refundable rates. A lot of things, big and small, that normally are the things which happen under the hood, which we don't necessarily promote during these calls, but are the things that justify the fact that in Q1 we've been wrong. It's not just because we're lucky leveraging a certain market demand, but because we are changing our strategy to do it. And so, our asset line model, diversify product portfolio, and focus on selling Europe to European travelers is really helping together with the actions we're putting in place. And all of these things being considered, I mean, I know that you care about the why and the how, but at the end of the day, you care about the what in terms of financial results. And this is why in You know, in a travel sector in which a lot of players are predicating doom and gloom and are saying that they're either lowering or canceling their guidance, in our case, we stay steady, and we confirm that we expect to be growing in 2026. We've been growing into one, and we expect that we will see that growth for the entirety of the year. Obviously, this is predicated on certain assumptions. For example, you might know that Ryanair and EasyJet are the two main airlines that we work with, and up to now we have not seen a significant growth in their pricing. Probably they were good in hedging themselves against possible fuel cost increase. I know there's been a lot of conversations in the industry about the troubles, for example, affecting other airlines, such as Volotea, but, for example, airlines like that are not important in our product mix. So again, the type of product that we have, it's also true that in situations like that, someone who's really efficient and providing good pricing focusing on the budget end of the market is normally thriving. And this is exactly what we are typically in these situations. Those who are at the extremes, you know, the super luxury providers and the budget providers thrive. The ones in the middle probably have some problems. So the fact that we're able to have very good pricing with a very efficient cost base allows us to be well positioned to capture the change in demand that we're seeing in this moment, and of course, also the last minute demand that we should be seeing in the next few weeks and months. And with that, I think I can hand over to Yulia for our financial calendar, and then we can take your questions.

Perfect. Thank you very much, Alessandro. Here you have a brief overview, as always, of our latest publication dates and the conferences we will be attending throughout the year. With that, we will be now beginning the Q&A session, starting with live questions first, followed by those submitted via the webcast. Please note that similar questions we may have regrouped to answer and slightly rephrased. In line with our privacy and data protection policy, we remind participants that stating your name when asking a live question is optional. With that, I will hand over to Mathilde now, our chorus call operator, to begin with the first live question. Thank you, Mathilde.

We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Questioners on the phone are requested to disable the loudspeaker mode and eventually turn off the volume from the webcast while asking a question. Webcast viewers may submit their questions and writing via the related field. Anyone who has a question may press star and one at this time. There are no questions at this time over the phone.

Thank you, Mathilde. Then we will move to the webquest questions we have received this morning. I will start with the first question. You delivered a remarkable performance last year. Could you elaborate on why the board has chosen to keep a dividend of 0.41 euros?

Okay, Julia, I'll take that. I think we already discussed briefly during the presentation, but in general, the dividend of 41 cents is calculated after adjusting for the no recurring and non-cash items related to the sale of the cruise business. If you remember, this happened at the end of the third quarter. And these adjustments in total count for approximately 2.7 million. The board proposal is based on the decision to neutralize this impact. And by normalizing this effect, the distribution sits at 33% of the net profit, which is in line with our dividend policy.

Thank you, Diego. Now moving to the next question. Did you see significant changes in the booking patterns after the breakout of the Iran war?

Well, I strongly suspect that this question was written before. And I asked my colleagues for confirmation if they saw the question coming up before. I presented exactly this in two pages of our presentation, so I guess it would be pretty boring for everyone if I repeat exactly what I said about that. I think I covered that in terms of the source markets, in terms of the destinations, in terms of the timing. And in terms of the type of things which are more relevant for customers now, and I would say more relevant for us, not just how the market is changing, but our own response to that and our productivity to make sure that we can actually benefit from this situation, also taking advantage of our last minute breath. So I think I've already covered pretty much detailed this one. I think we can... Move on to the next one, and obviously, if the person who asked this wants to follow up, they're more welcome to do so, either unmuting themselves and asking a live question or writing a new question on the web chat. Thank you.

Thank you, Alessandro. Moving to the next question now, congrats on the successful year 2025 and the achieved ESG rating. Revisiting the financial liability section, specifically the Additions column, that represents new loans and credit lines secured within the period. What is the main purpose of usage of the uncommitted bank loans?

Well, the usage of the uncommitted bank loans is typically bridging the end of the travel season in November of each given year and the start of the new season at the beginning of the following year. If you look in the past, the utilization has been going down each and every year, and this is reflecting our improved cash position. I already mentioned during the preliminary call that already in mid-February, all those uncommitted credit lines were already repaid, and we were debt-free.

Thank you, Diego. Moving to the next question. Do you think the European travel industry will be a winner from the uncertainties coming from the Iran war situation, specifically for summer bookings?

Well, I'll take this. Well, I mean, of course, geopolitical instability is never a positive for the world as a whole, for global economy, and for the travel market in general. And obviously, as travel professionals, we want the industry to work together in this moment. But It's also true that I would say the prime European market historically has been acting as kind of a safe haven during, you know, volatility in other parts of the world, and in this case, Middle Eastern specifically. So as we already discussed, we're seeing this redirection of demand for some people who, you know, previously considered Middle Eastern regions now shifting their searches and their bookings to work. Western and Southern Europe. So I would say that our strategy, which is very intentional about offering different products to serve different customer needs, but operating in many source markets and, of course, many destinations as well, ensures that we're not exposed over a certain amount threshold to a single product or geography. So I think, again, the important thing is that in terms at least of people searching for their holidays, we're seeing that there is a shift in where and when people choose to travel, but not as much in the terms of volumes. I mean, there is a resilience in terms of willingness to travel and availability of a discretion of spending for travel. So I think this is very important.

Thank you, Alessandro. Moving to the next question, you previously announced plans to integrate into AI ecosystem such as just GBT and Gemini. Can you update us on the current status and how far along are you in that integration? And are there already life use cases?

Yeah, yeah, yeah. Well, actually, there are already. I think this is composed of two different things. On one hand, we have to you know, prepare the infrastructure on our side, so the MCP server. And in that sense, we have already done it. So we started with the MCP server for flights to provide live inventory via that way. And then more recently, we've also done it for our holiday package for our dynamic packaging product. So that part has been developed. And now it's a matter of integrating that into the front end, I would say, of the various chatbot providers. So we started with Anthropic, with Claude, integrating our own app there. And we've now submitted as well our app to OpenAI for their own approval and release. So we will be updating you in the very next few weeks. It's something that will happen very, very soon, depending, obviously, on the wrong timing for approving and publishing our product within their ecosystem. But yeah, it's happening now. It's not a perfect thing happening in the future.

Thank you, Alessandro. Now moving to the next question. Do you expect any one-offs or special costs during 2026, like where you have seen them in 2025?

Yes. So, in 2025, the one-offs were clearly identified and were related to the organization we put in place in June 2025 and subsequently sale of the cruise business. So, those were really one-offs, and we are not expecting those to happen again in 2026.

Thank you, Diego. I'm moving to the next question. You are generously undervalued against the sector multiple. Do you think that using cash for expansion strategy M&A could be a good move for the business and also trigger for rewriting?

Well, I mean, in terms of right now, As we said, we are in a much stronger position in terms of our cash flow and in terms of the cash that we have on our bank accounts. And I think that there are some very interesting uses for that that we can have in order to improve our economics. For example, one thing that we're doing is that we are prioritizing paying a lot of suppliers with prepaid cards. on which the more technical word, I'm saying kickback, but kickback is not the technical word. The revenue share of the card providers is higher than on credit cards, right? And I think that we have other examples and that we are considering other examples in which potentially anticipating payment to certain providers can provide us better better economics and better unit economics. So, of course, we are always potentially, you know, opportunistically considering if there could be startups that we work with that are doing something interesting and that sometimes in a make or buy decision in terms of especially certain technological developments, things related to AI or not only that, could be done by companies you know, outside of our perimeter rather than by us, but this is the thing. So really focused on using that cash availability for industrial purposes rather than, for example, for considering a big merger with an equally sized company, if that's the question.

Thank you, Alessandro. With that, we have at the moment no more webcast questions online. Mathilde, do you maybe want to recheck if there are any live questions at this moment in time?

Yes, we now have a question from the line of Volker Bosse from Baader Bank. Please go ahead.

Yeah, hello. Good morning, Volker Bosse, Baader Bank. Thanks for taking my question. I would like to come on the marketing cost, which increased year over year in 25 in line to your guidance. Is that trend going to continue an increasing share of marketing in percentage of sales, so to say, and also in which areas, in which regions you spend more on marketing? I mean, not region by countries more, is it regions? offline, online marketing in that regard. Second question is on headcount. It means it remains stable year over year at year end. Is that going to continue? So do you plan any hiring so consequently then the personal costs in percentage of sales should go down. And is that also the way how to model the year 26, your guidance is sales and adjusted EBITDA to grow by 10% means adjusted EBITDA in line to sales, marketing sales in percentage of revenues going up, personal costs and percentage of revenue going down. So coming then to the, so to say, flat margin progression in 26. Potentially, is that the right way to look at it? Thank you.

Hi, Volker. Nice to hear from you. I was worried not to hear your questions, so thank you for assuring us in that sense. Yeah, I mean, okay, marketing. So marketing, yes, it's been growing in absolute value. The logic that we have for marketing is basically that we want to have very healthy unit economics, right? We want to make sure that the lifetime value of the customers that we acquire is always at least two times the cost of customer acquisition. Everything that satisfies that threshold basically provides us a direct positive impact on our gross profit in absolute value. So that's what we care. We do not care about the, I would say, of a gross margin percentage. We care about the fact that if we spend one euro, we get two euros back, and therefore we have a positive contribution to our absolute gross profit, which then remunerates the fixed cost and provides the operating leverage that we've been talking about. So this is the overall logic. Now, in terms of the specific markets in which this has been focused, of course, As you know, we have started to invest in what we call expansion markets in 2025, and we plan to continue doing that in 2026. The results are very positive. Of course, there's a lot of markets in which our brand is not known because we never invested there. And so it is structural and normal that... from a relative point of view, the return of that additional euro spent in that extra market is potentially lower than the return of that additional euro spent in a core market, but up to a certain point, because of course, In the core markets in which we've been acting for over 20 years and in which there's a lot of competition, of course, you also have to consider that. So in other markets, we really have the possibility to make inroads. I find it very interesting, for example, that in some Eastern European markets, after less than one year of operations, we are already among the top three most searched travel operators, if not, in some markets, even the number one. Obviously, these are markets which are a fraction of huge markets such as the UK or Germany, but I think it seems very interesting to potentially be achieving a leadership position in these markets very, very soon. But again, always with that discipline that we want extra euro of marketing investment to provide at least two euros of positive impact on the PNL. Last one. The second question, yes, of course, as you might remember from all the data we shared last year, we reduced our headcount by 120 people last year. But then, obviously, at the same time, we also hired people in new roles, so a bunch of AI engineers and engineers other people in roles that are more coherent with the type of evolution that we're seeing as a company. But for sure, if you look at it from a broader financial point of view, the cost of personnel in terms of the percentage of revenues is definitely going down. And I would say this applies in general to all the fixed costs. So this is one of the key, by the way, also internal KPIs that we monitor, the percentage of fixed costs on revenues. And we've been going down significantly from... you know, in 25 compared to 24, and we plan to continue 26, 27, 28. That's definitely something that is going to be consistent over the next few years.

And I see we have one more live question, so .

Yeah, okay. If there's one more live question, we pick that, and then we see if there are other follow-up questions after this, yes.

The next question comes from the line of Tim from Montega. Please go ahead.

Yes, good morning. Thanks for taking my question. I have two questions. Actually, the first one will be sort of on your – yeah, if you could shed some light on the price effects. You mentioned that Ryanair has not raised prices yet, but how do you expect that to pan out if that does happen? I mean, there's probably a demand effect, but there's, on the other hand, sort of an average booking value effect, and how do you imagine that to – to balance out. And the second question is in terms of capital allocation, you mentioned potentially M&A, but however, looking at your valuation at the moment, what do you think about capital allocation in terms of actually share buyback seeing the low valuation you currently have? Thank you.

Thank you. Let me start with the second element. because this is the typical thing on which it's easy to have a misunderstanding. I'm not saying that we're considering M&A. That's not the point. No, we're not actively considering M&A. We are considering using, prioritizing the use of our cash flow and cash resources for industrial reasons. I said switching more of our payment to prepaid cards, potentially anticipating payment to some suppliers in exchange for better economic conditions, better rates, discounts, and stuff like that. So using our balance sheet and cash flow to improve our P&L in a way. That's the priority. Then I mentioned incidentally that, of course, there might be something really small and very interesting, but almost as a technical investment rather than developing certain things inside in-house, rather than doing an acqui-hire. We might consider that, but that's it. I said that precisely to rule out. big M&A operation. So it's the opposite. So I want to be, I hope this is very clear because let's not have misunderstandings. I would hate to see a headline of last minute prioritizes M&A, right? No, this is absolutely not the case. So I hope this is clarified. I'm not sure I fully understood the first question, to be honest.

Thank you for clarifying that. That's very, very clear. But how do you think about share buyback in terms of capital allocation? And the first question is, was you mentioned that Ryanair obviously is a big and important partner, and you specifically mentioned that they have not raised prices yet. I was just trying to understand your thoughts on that, because obviously there's an effect of price increases on demand. On the other hand, I presume your average order value or the booking value increases, which is on a direct comparison basis positive, right? Or is that a wrong thought?

Well, not necessarily. I mean, it depends. Look, at the end of the day, we need to be competitive in the market, right? So especially for our package holidays, I mean, when we're selling flights only, obviously the comparison, especially for people who use metastar channels, is very easy. And even one euro of difference can make a difference in terms of conversion. So we have a very sophisticated system to make sure that we price a specific flight in a way that we can be both competitive and profitable. And most of the time, the profit comes more from the ancillaries that we sell on top of the flight-only seat, I would say. And we have a complex system that takes into account statistically what type of ancillaries we typically sell on top of the seat, and therefore, the profitability we can expect from that seat. And therefore, if we can potentially discount that seat compared to the official price or not. And of course, with different airlines, we also have different limitations in terms of how much we can discount or not discount their face value. So for the flight business, I would say it's very mathematical and it's very, and I think that the success in our growth and profit is precisely because of the progressive improvement of that and progressive improvement of the ancillaries that in terms of both the availability of ancillaries on our product mix and also the pricing of ancillary. together with the pricing of the flight seat. So the two things clearly go hand in hand. With dynamic packaging, obviously, when we sell a package, again, we need to be competitive in the market with On the Beach, with Love Holidays, with TUI, with all the various competitors we have in the various markets. So if flight prices will raise for everyone. You can expect that potentially also packet prices will go up, but this is very speculative. We don't have indications right now, so if and when that will happen, then we will face it. But I would say if it happens, it's not something that will impact only us. It will be a general industry situation, and so we will see. The important thing is that we maintain pricing which are competitive for our customers. In terms of capital allocation share buyback, Again, let me restate that the focus is on industrial usage of our cash. So the priority is on that to help us improve our P&L and even further improve our cash flow. This is the priority right now. We did share buyback, as you probably remember, consistently for a pretty long time. We could do it in the future. There is a general blanket scenario. I would say approval in that sense that we have still ongoing, not a short-term priority because we think we have more interesting uses to improve, first of all, the industrial performance of the company.

Okay, thank you very much. All the best.

Thank you, Alessandro. Matilda, are there any more live questions at this stage?

That was the last question. I would now like to turn the conference back over to Alessandro for any closing remarks.

Well, thank you, Matilda, and thank you, everyone, for joining us. I hope it was informative. Normally, the call in which we talk about the audited results is maybe an eventful one because, of course, the results are the same that were already presented a bit over a month ago. In this case, probably it was a bit different because of the Middle Eastern situation, and I think that everyone was interested in a trading update. So I do hope that the key messages that we wanted to pass did come across. We have been growing in Q1. Of course, the situation is impacting the market and everyone, but us, I would say, probably much less than others, not just, again, because we're lucky, but because of the conscious choices that we have been making and that we are making now to address the situation. And obviously, we're closely monitoring how things evolve and see whether there are, you know, even more opportunities for us in this context. And with that, I, you know, look forward to seeing you again on the 6th of May for our official Q1 results announcement. Thank you, everyone.

Ladies and gentlemen, the conference is now over. Thank you for choosing Coruscall and thank you for participating in the conference. You may now disconnect your lines. Goodbye.