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eSky Group's sales in the first three quarters of 2023 increased by one-third compared to the same period in 2022, reaching EUR 640 million. This marks the best historical result in the Q1-Q3 period for the travel booking platform owner. Meanwhile, EBITDA increased by 3% over the same period to EUR 17 million. The slower pace than in previous years is due to increased investment in marketing, technology development and the hiring of many new specialists.
The company's high growth rate can also be seen from the perspective of its 2019 results. After nine months of this year, the company is reporting a 47% higher revenue level, expressed in Total Transaction Value (TTV), than four years ago. Operating profit, meanwhile, is 145% higher compared against 2019.
Non-financial indicators have also gone up. For example, the number of bookings processed on eSky Group services in Q1-Q3 2023 was almost 1.8 million (+23% year-on-year), while the number of customers topped 2.7 million users, a 24% increase on last year.
eSky Group’s current financial results reflect significantly improved operational efficiency compared to the pre-pandemic period. They are also evidence of the successful implementation of a strategy that brings the Group closer to becoming the first choice platform for travel bookings in Central and Eastern Europe. eSky caters to all the needs of a traveller in one place and this approach is delivering notable results. This is evidenced by both growing revenues and operating profit, as well as an ever-expanding customer base. However, it is expected that both the fourth quarter and the whole of next year will be tougher for the industry. This is especially likely when compared to the last two years, when people were 'recovering' from the pandemic, which resulted in an increased demand for travel and an associated increase in prices. Add to this a possible economic slowdown and it seems that the situation for the travel industry over the next year may be a little more challenging for everyone – Łukasz Habaj, CEO of eSky Group, said.
eSky Group invariably generates its largest turnover from products and services sold in Europe. Significantly, its Central and Eastern division, led by Poland, is responsible for 33% of the Group's total sales between Q1 and Q3 of this year, recording a 40% year-on-year increase in sales. At the same time, the company strengthened its positions in other markets, with Western Europe being the biggest beneficiary of this, having grown by almost half year-on-year in terms of sales, which accounted for approximately 42% of the Group's total revenue in the first three quarters of this year (+3 p.p. year-on-year).
The third-largest market for eSky Group is Latin America, where the company earned 14% more in Q1-Q3 2023 than in 2022, however, due to higher sales momentum in Europe, its share of revenue declined by 3 p.p. year-on-year to 17%. Twice as much - 8% of TTV's total value - was generated by the company in the United States, improving local sales performance by more than 15% year-on-year. The Africa and Asia-Pacific regions account for less than 1% of the Group's revenue structure.
After nine months of 2023, 37.5% of bookings handled are attributable to the Western European market – this represents the highest number of bookings of all regions. This is closely followed by Central and Eastern Europe with a 37% share. During this period, transactions in Latin America accounted for nearly 18% of all company service operations, while in the United States the figure was just over 7%. The customer structure looks identical to bookings, with differences in performance of less than 1 p.p.
We are currently finalising our action plan for next year and will continue to consistently develop our dynamic package offering, combining multiple products in a single booking. This service is well-known in Western European markets, while gaining recognition among customers in neighbouring countries. We are building up City Break and Real Time Holidays products, giving the customer a multitude of options and full freedom in their choice of flight, hotel and other additional services. These offers are fully covered by the Tourist Guarantee Fund, while maintaining full safety and consumer protection for all – Łukasz Habaj, eSky Group's CEO, added.
It is on packages that the company is building its competitive advantage, with particular emphasis on Central and Eastern Europe, where this option solution has only been popular for a few years. Despite this, package sales in this fast-growing market for Q1-Q3 2023 boast one of the highest growth rates, with a 226% and 312% increase in revenue from the sale of package offers, relative to 2022 and 2019, respectively.
In addition, it is in our region that customers are most keen on bundles, with Central and Eastern Europe accounting for as much as 60% of total sales of this type of offer. More than 30% of packages were sold in Western Europe, with the remaining 10% belonging to Latin America (8%) and the USA (2%). Across eSky Group as a whole, the growth in dynamic package sales in the first three quarters of this year is at 90% when compared to 2022, and 180% compared to 2019.
The platform also recorded higher airline ticket and hotel sales over the first three quarters of 2023. eSky Group customers spent 33% more on flights and 12% more on hotel offers than in the comparable period for 2022. For both tickets and accommodation, it is Western Europe that is ahead of other markets, as it accounts for 42% of sales of air offers and 48% of revenue from booked accommodation. In Central and Eastern Europe, these figures are 33% and 29%, respectively.
Methodology
The source of the financial data presented in the analysis is the eSky.pl SA Capital Group. Selected financial information from the first, second and third quarters (January-September) in the years 2023, 2022 and 2019 are presented. Data is based on completed transactions for all services belonging to eSky Group. Due to the international nature of the company and the conduct of financial operations in many countries, financial values obtained as a result of the analysis have been converted into EUR at the average exchange rate from the year given.