Despegar.com Corp

Hello and welcome to today's conference call. Today's call will begin in just a few moments time. If you would like to ask a question today, please press star followed by one on your telephone keypad. Or alternatively, if you have joined us via the webcast, you may submit a text question. Thank you for your patience. We'll be right back. Good morning and welcome to Despargar's first quarter 2023 earnings call. A slide presentation is accompanying today's webcast and is available in the investor section of the company's website, www.investor.despargar.com. There'll be an opportunity for you to ask questions at the end of today's presentation. This will be conducted via the telephone lines or by submitting a text question via the webcast. This conference call is being recorded. As a reminder, all participants will be in listen-only mode. Now, I would like to turn the call over to Mr. Luca Pfeiffer, Investor Relations. Please go ahead.

Good morning, everyone, and thanks for joining us today. In addition to reporting unaudited financial results in accordance with U.S. generally accepted accounting principles, we discussed certain non-GAAP financial measures and operating metrics, including foreign exchange neutral calculations. Investors should read the definitions of these measures and metrics included in our press release carefully to ensure that they understand them. Non-GAAP financial measures and operating metrics should not be considered in isolation as substitutes for or superior to GAAP financial measures and are provided as supplemental information only. Before we begin our prepared remarks, Please turn to slide two and allow me to remind you that certain statements made during the course of the discussion may constitute forward-looking statements which are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to materially differ, including factors that may be beyond the company's control. These include but are not limited to expectations and assumptions related to the impact of the COVID-19 pandemic. and the integration and performance of the businesses we acquire, including Best Day, Stace, Via Hanet, and Coin. For a description of these risks, please refer to our filings with the U.S. Securities and Exchange Commission and our press release. Speaking on today's call is our CEO, Damian Skokin, who will provide an overview of DesPegard's first quarter performance, as well as an update on our strategic initiatives. I will then discuss the quarter's financial results in more detail, after which Damian will end our preferred remarks, providing annual guidance and a wrap-up before opening the call for your questions. Damian will begin his remarks on slide three. Damian, please go ahead.

Thanks, Luca, and good day, everyone. Thank you for joining today's earnings call and for your interest in the SPGARs. Travel demand accelerated to begin the year, helping drive our gross bookings 44% higher in the first quarter when compared to the first quarter of 2022. Stepped-up demand combined with a healthy take rate, ASPs increasing in the mid-30s, and a still improving revenue mix took our revenue to record levels. Importantly, our operating expenses increased at a far slower pace than gross bookings, rising only 34%. And the quarter's strong top-line growth, coupled with the operating leverage we built into the business, drove adjusted EBITDA 154% higher to $17.3 million, our strongest in five years. Also gratifying was Coin's performance, which took another step towards the break-even point with Evita improving $2.1 million year on year. Turning to innovation on page four. On the left of this slide is a screenshot of a personalized homepage, a feature that we recently launched. This feature helps drive customer engagement by offering tailor-made flight and travel packages based on their purchase history. Engagement as well as customer experience are also improved by providing information that enriches travel planning, such as discount alerts and reels with travel tips and destination recommendations. The chart on the right shows the share of transactions completed across our acquired brands as a percentage of consolidated B2C transactions. When integrating Viajes Falabella, Best Day and Viajanet, we quickly had them running on our app platform while maintaining their brand identity. This has enabled us to drive customer engagement and of course, increase conversion rates. Also noteworthy is that over 60% of online B2C transactions across all our brands today involve some degree of participation of customer activity via our apps, even though more than half of them are completed online, underscoring the significant potential to increase customer engagement over time. In a moment, we will show our progress to date. Moving to slide five, here we track KPIs that show the progress we have been making in our three key focus areas, to increase both revenue and profitability, starting with revenue diversification, higher margins, standalone travel packages, and counting for 34% of gross bookings in the first quarter, up 4 percentage points year-on-year, and increasing 13 percentage points since the first quarter of 2019. Reflecting our strategy to prioritize our key growth markets, Brazil and Mexico, our operations in these two countries now account for 59% of total gross bookings, up from 53% in last year's quarter. As shown in the middle of the table, our focus on diversifying distribution channels is very fraught. Our B2B channel, which includes wide labeling of our platform, accounted for 15% of gross bookings in the quarter, more than doubling from 5% in the first quarter of 2018. Our apps continue to attract an increasing number of transactions, with nearly 37% of online B2C transactions conducted via our apps, up from over 24% in the same quarter of 2019. We also saw a meaningful increase in our install base, which reached 25.1 million downloads up 21.4% year on year. Customer centricity remains an integral part of our growth strategy. At the end of the first quarter, we had 14 million members in our loyalty program, Pasaporte. And over the last year, point redemptions by members have doubled to 7%. Our net promoting score increased 800 basis points, bringing us within 20 basis points of our first quarter 2019 pre-pandemic scores. I will now turn the call over to Luca for a deeper dive in our performance, starting with revenue and gross profit on slide six.