For some, being stuck in a confined space with no escape alongside their significant other would be an utter nightmare. For others, cruise ship holidays are probably much more enjoyable, and with the Government lifting its ban on cruise ships, the folk at Helloworld (ASX: HLO) Travel couldn’t be happier.
Deemed by the Australian Government as the spreader of all spreader events, cruise ships have been banned from our shore since the very start of the COVID-19 pandemic. This was a reactionary move in the interest of our national health as infected cruise ships became floating morgues as soon as a passenger outbreak was identified.
With the loss of cruise ship holiday sales which made up one third of their sales before the onset of a pandemic, it’s been tough sledding for Helloworld which hasn’t been able to fall back on domestic tourism like others in the tourism industry have.
“This has been a long time coming and agents and their clients across Australia are both relieved and thrilled that this ban is finally coming to an end” said Helloworld CEO, Andrew Burnes.
“The lifting of this ban will make a material difference to the sales of our agents and of Helloworld’s leisure travel divisions, both retail and wholesale.
“The Federal Government has indicated the final decision on opening ports rests with each State Government and we look forward to that occurring as soon as possible.:
17 April 2022 is the stated date that ports will re-open to international cruise ships with Helloworld hoping it doesn’t take too long to regain momentum in the sector.
In pre-COVID FY19, total cruise sales across the Helloworld business in Australia was over $1 billion with the Company taking a clip on all sales as their commission.
With Aussies having primarily taken their holidays by road or air, Helloworld has seen growth in their air sales bookings with their YTD bookings to 6 March 2022 being $547m, 121% higher than last year’s $248m.
“We’ve seen a steady increase in air sales across the business since mid-January and booking levels are now at over 50% of pre-Covid levels. These increases are consistent across all networks and across all States and Territories. It’s a credit to our agents that they have been able to steer a course through these incredibly tough times and now finally begin to grow again,” said Burnes.
Prior to the onset of COVID, Helloworld generated $352.5m in revenue but this was decimated in the following two years when reporting $278.3m in FY20 and then $68.1m in FY21 with a corresponding $35.5m net loss.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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