WOTIF SHARES DOWN DESPITE STRONG PROFITS

WOTIF.COM Holdings Limited (WTF) shares went downwards by 6.5 per cent today despite the online travel agent recording 22 per cent net profit growth for FY10.

In an announcement to the ASX Managing director Robbie Cooke was upbeat about growth on 2009’s record figure, but shareholders appear to have expected more from the Milton-based company that recorded 26 per cent growth last year.

“One of the most impressive features of this result is that it comes off the back of a 26 per cent profit increase last year – a year in which we were riding on the tail winds of an exceptional combination of events that really played in Wotif’s favour,” he says.

“It was never going to be an easy task to beat last year’s numbers, so it’s a real credit to the team here to have delivered another record outcome – increasing profits by $9.5 million.

But the downward shift in the share price shows that many investors are concerned Wotif might not be able to keep up its stellar run, with the looming threat of bigger competitors like Expedia and Flight Centre.

Wotif was also able to boost revenues by $6.4 million in FY10 on the back of expansion into flight bookings through Wotflight.com.

“While it’s still early days, it’s great to see our flights initiatives gaining traction in the year. Wotflight and our other flight channels contributed close to 5 per cent of our revenues this year,” he says.

“We see the sale of flights as an incremental value-add and a logical expansion of our offering to Wotif’s large customer base.”

“Growing our share of the Australian accommodation segment from approximately 8 per cent to 10 per cent over the last year bears testament to the compelling Wotif model. We provide a win-win outcome for consumers and hoteliers alike.”

The company has also boosted its full year dividend by 4 cents a share this year.