eDreams ODIGEO S.A. (EDR) Earnings Call Transcript & Summary

Good morning, everyone, and thank you all for joining us today for our full year fiscal year 2024 results presentation for the 12 months ending 31st of March 2024. I am David de la Roz, the Director of Investor Relations at eDreams ODIGEO. As always, you can find the resource materials, including the presentation and our results report on the new Investor Relations section of our website, which includes a number of new functionalities like video recaps, post results presentations, and a new valuation tool among other things. I will now pass you over to Dana Dunne, our CEO, who will take you through the first part of the presentation. Thank you.

Thank you, David. Good morning, everyone, and thank you for joining us. Today, we believe that again we've delivered outstanding results. Outstanding because we continue each time we report to deliver or beat our own and market targets. Over the past 7 years, we've transformed our company into the leading subscription business operating in the travel segment. And eDO has become, without a doubt, a major player in the global EUR 1.8 trillion travel market and the wider e-commerce ecosystem, working with nearly 700 airlines and 1.2 million hotels. We have a truly unique and highly successful subscription offering. However, it's not just the membership growth that we're proud of. We've been innovating rapidly and growing profitably, too. More than doubled profitability in 2 years, which is truly extraordinary, reaffirming the strength of our business model and strategy. The Prime model remains a consistent source of long-term value. Rising profitability is driving the free cash flow, excluding non-Prime working capital. We take great pride that the ambitious FY '25 goals of 7.25 million Prime members and a cash EBITDA of EUR 180 million, set back in 2021, are well within reach and that next year will mark a decade of consistently meeting expectations and guidance, something that not many can say. We are confident the growth and profitability manifested in our guidance and also our belief that our stock is clearly undervalued. As a result, we are announcing today an acceleration of the share repurchase program for the remainder of the original 5.5 million shares targeted. We will consider subsequent share buybacks as we continue to generate free cash flow on an ongoing basis. Today, we'll take you through the key points of our strong set of results. This includes, first, a recap of the eDO results; second, our financial results and the outstanding growth in delivery we achieved in FY '24. That will be done by David Elitaga(sic) [ Elizaga ]. I'll then take you through our strategic update and conclude today's presentation with some closing remarks about our long-term fundamental growth potential well beyond FY '25. So, now please turn to Slide 4, which is a summary of our performance on fiscal year 2024. In FY '24, the strength of the Prime model drove strong growth and significant profit improvements again. Cash EBITDA grew 44%, and we added 1.5 million new Prime members. Some of the key highlights for today's presentation are: first, we'll cover the highlights just mentioned about our outstanding growth and delivery in FY '24. And this is the Prime business continues to grow rapidly and is now at an inflection point financially. Cash EBITDA was up 44% to EUR 121.4 million and is expected to grow another 48% in FY '25 to EUR 180 million. We continue to achieve significant improvement in profitability, with cash EBITDA margin up 8 percentage points in just 2 years, that is from FY '22. And this equates to a rise to 18% in FY '24. The Prime members reached $5.8 million in FY '24, and that is up 34% year-on-year. Prime, in fact, is the fastest-growing subscription program across all industries, reaching $5.8 million FY '24, a compounded growth rate of 177% over the past 6 years. And cash marginal profit is up 32% to EUR 217.3 million in FY '24. And the margin has improved 6 percentage points over the last year as well. Our free cash flow, excluding non-Prime working capital, more than doubled from EUR 20 million in FY '23 to 45 million in FY '24. And it's expected to double yet again in the next year. Second highlight: eDO subscription model has proven to be effective. eDO has the highest TrustPilot scores among its peers at 4.4%. This is 2.2x greater than the average OTAs and 2.9x greater than the average airlines. This metric has had a 26% improvement since our Capital Markets Day, back in November 2021. Also, our NPS continues to improve, 52% improvement for Prime members since our capital markets day, with 87% of our Prime customers day scoring us as 7 or above. Prime members book more, 3.8x more than a non-Prime customer. And that is a 41% improvement since our Capital Markets Day. Churn rates continue to improve. Prime churn reduced 12% for Prime members that are year 2 plus and 1% for year 1 Prime members, and that's all since our Capital Markets Day back in November of '21. Today, eDO is a much more stable and predictable subscription-based business. Now 76% of our cash marginal profits from Prime, and that's a 26% improvement in just 2 years, i.e., since FY '22. The percent of year 2 plus members continues to grow, which is a key driver for improvement in profitability. 66% of total cash revenue margin comes from year 2 plus numbers. That's a 44% -- sorry, 44 percentage point improvement since FY '22, and it continues to improve year-on-year. The third highlight is about our FY '25 guidance. For FY '25, we remain on track to meet our EUR 180 million cash EBITDA target. So, our Prime members obviously in excess of 7.25 million prime members and free cash flow generation, excluding non-Prime working capital to over EUR 90 million, more than doubling versus FY '24. The fourth highlight, we are announcing today an acceleration of the share repurchase program for the remainder of the original 5.5 million shares targeted. We will request authorization from the Spanish Stock Exchange regulator to launch a tender offer for 4.5 million shares at a price of EUR 6.9. We believe our stock is undervalued. We generate cash, and we want to buy it back quicker than under the original share repurchase program. The fifth highlight, longer term, beyond FY -- beyond 2025, eDO has strong fundamental growth potential. Look, the attractiveness of our segment of travel is leisure, and we will continue to benefit from the strong consumer demand for leisure travel in which there's a clear structural shift from offline to online. We'll also benefit from eDO's ability to further increase household membership penetration from low levels in the markets in which we currently offer Prime. We'll expand Prime into new markets, moving well beyond the 10 markets in which we currently operate, and we'll enter new customer segments and further launch additional products and services under Prime. With that summary, let me highlight -- sorry, let me pass this over to David who will take you through some of the KPIs of our Prime model and the strong growth and significant profit improvements in FY '24 results.

Thank you, Dana. If you could all please turn to Slide 6 of the presentation and will take you through some of the KPIs of the Prime model and financial results in more detail. Please turn to Slide 6. Profit margins were up significantly. This was due to the growing maturity of the Prime members, resulting in strong improvements in profit during the last fiscal year. In fiscal '24, cash margin or profit margin in our Prime segment improved by 8 percentage points to 40% on a 12-month basis from 32% in fiscal '23. Cash EBITDA also improved substantially by 4 percentage points, increasing to 18% on a margin on a total month basis from 14% in fiscal '23. If you please turn to Slide 7, you see that we are a subscription business, focus on travel, and not a transaction-based business. Let me remind you that when looking at Prime versus non-Prime, we still think it makes more sense to look at our business on a last 12-month basis as Prime is an annual subscription business, and seasonality impacts the pattern of net adds in a particular quarter. The non-Prime part is also influenced by seasonality parents. We have reached, in the last 12 months, a 61% share of cash revenue margin and 76% share of cash marginal profit being delivered from Prime members versus 46% and 56% a year ago. We are definitely a subscription-led business. Please turn to Slide 8 of the presentation. In fiscal '24, we delivered a strong growth in cash EBITDA and substantial improvements in margin as Prime membership maturity increases. In fiscal '24, we delivered solid growth in cash revenue margin, increasing it by 9% versus the same period last year. This was achieved following the continued successful expansion of the Prime member base. Cash revenue margin for Prime rose by 63%, resulting from the 34% growth of Prime members and because Prime ARPU increased to EUR 78.1. Cash marginal profit and cash EBITDA improved 32% and 44%, respectively, between fiscal '23 and fiscal '24. As guided, the maturity of Prime members is a key driver for profitability, and significant and constant membership growth has resulted in sharp profitability improvements as increasing members renew membership. Cash margin or profit margin increased 6 percentage points to 32% from fiscal '24 from 27% in fiscal '23. Cash EBITDA margin in fiscal '24 also achieved very substantial improvements and stood at 18% versus 14% in fiscal '23. That's a 4 percentage point advance. Our business is making a faster transition towards subscription and with higher margins than we anticipated back in our Investor Day on November 21. Back then, we expect to have cash margin or profit margins of 34% in fiscal '25. That is in a year from now. We now believe that these margins should reach 38% instead of 34%, and that's an increase of 6 percentage points from the results we are publishing today for fiscal '24. And this will be as a result of more of our business being Prime and also generating better margins within Prime. Cash EBITDA was up 44% year-on-year to EUR 121.4 million, which compares to EUR 84.4 million in fiscal '23 and is expected to grow another 48% in fiscal '25 to EUR 180 million. Please turn to Slide 11 of the presentation. Revenue margin, excluding adjusted revenue items, increased by 13% to EUR 642.6 million, mostly driven by an increase in Prime revenue margin up 63%, following the successful expansion of the Prime member base. Prime revenue margin growth was somewhat offset by the non-Prime revenue margin, which decreased 21% versus fiscal '23 due to the focus on the Prime side of the business. Variable costs were broadly in line with fiscal '23, despite higher revenue margin, as maturity of Prime members increases and reduces member acquisition costs. Overall, fiscal '24 has made an outstanding growth and delivery with the continued Prime revenue margin growth and significant improvements in profitability as more Prime members renew. Fixed costs increased by EUR 15.7 million, mainly driven by higher personnel costs as we scale the business. This is as guided and in line with our plan. As a result, adjusted EBITDA at EUR 87.8 million almost tripled versus the same period of last year at EUR 33 million. Adjusted net income was a profit of EUR 22.9 million in fiscal '24, significant improvement from the EUR 34.7 million loss in fiscal '23. This improvement was mostly driven by the EUR 54.8 million increase in adjusted EBITDA and the recognition of a deferred tax asset for prior year Spanish tax loss carryforwards. Turning now to Slide 10. I will take you through the cash flow statement. In fiscal '24, we ended the fourth quarter with a positive cash flow from operations of EUR 138.9 million, following the successful expansion of the Prime member base, which resulted in higher EBITDA. In fiscal '24, we had a working capital inflow of EUR 49.1 million, again, driven by the growth of our business. The lower working capital inflow in fiscal '24 versus the same period of last year is a result of higher increase in volumes between March '22 and March '23, associated with a catch-up effect for Omicron bookings. The volumes between March '23 and March '24 have been more stable. We have ample liquidity and headroom to deliver our plans. A consequence of our strong business model, cash generation and active management. At the end of March '24, the liquidity position was strong at EUR 251 million. We have invested EUR 48.9 million in fiscal '24, an increase of EUR 10.7 million as we capitalize our software. Cash used in financing amounted to EUR 31 million compared to EUR 67.7 million in fiscal '23. The difference of EUR 36.7 million relates to the outflows in fiscal '23 of the reimbursement of the revolver by EUR 30 million and the government-sponsored loan by EUR 3.8 million. If we look at fiscal '24, our free cash flow, excluding non-Prime working capital, more than doubled from EUR 20 million in fiscal '23 to EUR 45 million in fiscal '24 and will double in the next year to hit EUR 90 million. Included in our estimates are EUR 54 million of CapEx for fiscal '25, which includes our normal ongoing CapEx previously anticipated of EUR 50 million and EUR 4 million extra in a new back office system. We will invest in total EUR 6 million in the system between fiscal '25 and fiscal '26, and it will generate savings of EUR 2 million annually in OpEx ftom fiscal '26 onwards as a result of this investment. On the 28th of February 2024, we announced a share repurchase plan of 5.5 million shares in order to fund the LTI plans for employees until fiscal '27, and that was for a maximum of EUR 50 million. As of 29th of May, the company acquired 986,235 shares for a total amount of EUR 6.4 million. We are confident in the growth and profitability manifested in our guidance and also believe our stock is clearly undervalued. As a result, we are announcing today an acceleration of the share repurchase program for the remainder of the original 5.5 million shares targeted. We will request authorization from the Spanish stock exchange regulator to launch a tender offer for 4.5 million shares at a price of EUR 6.9. We will consider subsequent share buybacks as we continue to generate free cash flow on an ongoing basis. I will now turn the presentation back to Dana to go through our strategic update.

Thank you, David. I would now like to take you through our strategic update and this will focus on 3 topics. The first is our leadership in travel subscription. Second, our worldwide leading capabilities in tech and AI. And third, how effective at satisfying customers is our subscription model. Please turn to Slide 13. A feature of subscription companies is that they show high growth and penetration over many years. Companies like Costco have delivered over 30 years of growth, Netflix over 20 years, Spotify over 14. What truly sets eDO apart from all other travel companies is its unique and highly successful subscription offering. Prime members reached 5.8 million members in FY '24. This represents a CAGR of 177% over the past 6 years, remarkable by any standards. In just the last 2 years, we've added 3 million net new members on average, and that includes the pandemic years and travel restrictions. Irregardless of COVID, this makes us one of the fastest-growing subscription companies across all industries. And we have significantly more growth ahead of us with just 3.2% average household penetration in the 7 European markets in which we've launched Prime. Please turn to Slide 13. In just the last 2 years, we've added 3 million net new members on average. Prime is the #1 travel subscription program in the world with over 71% of Prime customers being entirely new customers who have not used an eDreams of digital products since 2021. This demonstrates eDO's ability to capture new customers. Please turn to Slide 16. Before getting into some examples of super exciting AI initiatives happening across E,. let me first recap quickly why AI is really important for us at eDO. AI is a central part of our competitive advantage. And we've got a proven track record in leveraging it to improve our customer proposition and increase shareholder value for many years. We've been an extremely early adopter in AI, significantly before its current ubiquity. We started in 2013, and by 2017 or 2018, we were already incorporating a similar level of AI that was being used in autonomous self-driving cars. AI helps us drive innovation. It supports our customer-centric strategy around Prime, such as through personalization, and it helps us win against our competitors. I know that nowadays, many companies say they use AI, but it is also true that only very few are really, really able to do this at scale. I mean of course, Amazon, Google, Netflix may be known for leveraging AI extensively. But most companies, large and small, struggle really to make AI work beyond a few lighthouse projects. And I know this through frequent conversations with the leaders and other companies. We at eDO, on the other hand, have managed to drive real groundbreaking innovation by applying AI at scale and build upon our over a decade year of experience. I would even say today that we're really at the forefront when it comes to creating value through AI, which is a real competitive advantage for us. And we have a tremendous accolade as Google has repeated acknowledged that eDO is one of the most advanced companies in AI in Europe. And you see some other quotes by them here on this slide as well. Success in AI is a real significant investment in terms of time and resources across three dimensions. The first dimension is data. Second one is AI algorithms. And the third one is the deployment of the infrastructure with the requirement for excellence across all three of these areas, to create a strong competitive advantage. And I'll touch on each one of these very briefly. The first around data. We have a substantial data pool because of our scale and our result on our customer-centric business model around Prime allows us to collect more data per customer. This data is democratized for all teams to use in our best-in-class data mesh. The second around AI algorithms. We use some of the most advanced AI algorithms such as deep learning, which powers personal assistance, enables computer vision and speech recognition, or improves your latest recognition engines that you find in places like YouTube, Amazon, et cetera. We also use reinforcement learning, which we've been using for quite a while and which is one of the ones that's used in self-driving cars. Also, obviously, generative AI in large [ language ] models, which are now the most sophisticated and promising AI nowadays such as Refined Empower, CHAT GPT, Gemini, Sora, Mid-journey, et cetera, et cetera. And we use those extensively. Also the deployment of infrastructure. In addition, we have an infrastructure that allows us to leverage AI across our platform. But we started with AI and a few functions almost a decade ago. Today, it's become an integral part of each and every function and powers more than 1.5 billion AI decisions every day. If you can please turn now to Slide 17. Leveraging the Prime database through personalization is key as it drives engagement and greater customer experience, which results in higher renewal rates. Data is one of the critical agreements -- ingredients for the success of both traditional and generative AI. High-quality data delivers a high-quality result. And the more data one has, the greater the competitive advantage. As the largest flight retail in the world, excluding China and #1 in Europe, we have an extremely large set of data. We can be much more precise in the answers or service we give to a customer and drive learnings more quickly than competitors who have smaller data sets, take longer and have less scope and less visibility. The more Prime users we have, the more data we create, the more accurate our predictions become. Overall, this has resulted in higher engagement and the highest TrustPilot scores among all of our peers as customers advocate Prime due to the high levels of the customer experience. When we combine this with our subscription program, it gives us a real competitive advantage, particularly since we were the first travel company in the world to offer a subscription for travel. We now have almost 6 million members who are subscribers, which gives us a significant advantage. We have deeper data, Prime customers repeat and interact more and they are logged in most of the time, providing us with a data advantage to understanding their needs better and being able to surface exactly what they want and tailoring the experience to that individual of one. Let me give just some examples of the wins using AI and personalization, flight deals you may have seen. We saw a 41% increase in user engagement between our new personalized destination recommendation offers versus our legacy offers, based on general popularity in the market. Another example will be AI-powered personalization through AI-driven personalization and we've been able to increase our user engagement, driving an improvement in both conversion and customer repeat rates. The challenge is not just to find the right content, but the challenge is to -- equally, is to surface it, at and when, to the right customer. In fact, we have hundreds and thousands of results for a given search, but only one top spot on search results page. So what flight option we show in that position and ant subsequent position is the main challenge we face. Or, put another way, is really the main opportunity we have, and that's where AI comes in. Furthermore, we have reduced the number of decisions and click customer needs to take, half the interactions of a U.S. competitor. Today, through AI-powered personalization, we are delivering monthly 2.5 billion individual flight searches and experiences, and that's an improvement over the already sophisticated former AI ranking model enabled by the superior data from our Prime customers. Another example on the hotel results page, personalizing our sorting in hotels has equally benefited our customers. As a result, we've been able to improve the conversion rate of hotels ranked with top 5 positions of our search results page by 29% versus an already AI-powered sorting algorithm. Please turn to Slide 18. Beyond these customer-facing uses, AI is also being used in many, many other areas across eDO, improving our products to increasing productivity and/or to simply enabling things that would not be possible without it. Every area, every team is expected to use AI within eDO. If you could please turn to Slide 20. The eDO subscription model has proven to be highly effective at satisfying the customers, and I'll take you through a little bit more details on that. Engagement and satisfaction continues to grow from our already industry-leading levels. At TrustPilot, eDO has the highest TrustPilot scores among its peers. It has improved 26% since our Capital Markets Day in November 2021. With 87% of our Prime customers scoring us 7 or above, that is 2.2x and 2.9x greater than the average OTAs and airlines, respectively. NPS scores, they continue to improve. 9% improvement in the case of non-Prime and 52% in the case of Prime from an already high NPS versus industry standards. Prime members book more and continue to improve. It's now 3.8x more than a non-Prime customer. And that's a 41% increase since the Capital Markets Day. Please turn to Slide 21. Churn rates. eDO's subscription model is highly effective at satisfying customers and it can be seen also because of our churn rates continue to improve as well. Year 1 prime members have improved by 1%, while year 2 and longer by 12%, which clearly shows how effective and satisfying for those using it and renewing it. Please turn to Slide 22. This shows how the eDO subscription model has proven to be effective and translated into outstanding growth and delivery in our results in FY '24. As you can see, eDO is a much more stable and predictable business. In FY '24, 76% of our cash marginal profit was driven by the subscription business, a 26 percentage point improvement in just 2 years. The percent of year 2 plus members continue to expand, which is a key driver for improvement in profitability. In FY '24, 66% of our cash revenue margin was in year 2 plus numbers. And that's up 44% percentage point improvement since FY '22. The Prime business is growing rapidly and financials are at an inflection point. Cash EBITDA up 44% in FY '24 and is expected to grow another 48% in FY '25 to EUR 180 million, something not many can say. This results in a significant improvement in profitability. Cash EBITDA margin is up 8 percentage points in just 2 years, beginning from FY '22. Cash EBITDA margin increased 4 percentage points in just 1 year, from 14% to 18% in FY '24. And the free cash flow, it's more than doubled in FY '24, reaching EUR 45 million. That's a 123% increase. And as we've said, we'll more than double in the next year to hit more than EUR 90 million, which again will be a over 100% increase in the free cash flow. If you could please turn to Slide 24. Let me leave you with some final closing remarks before we move to the Q&A. eDO has got significant growth opportunities. eDo Prime, today, is represented in only 10 countries in which we operate, and we continue to open new markets to drive future growth. Furthermore, we're just starting. Today, we only have a 3.2% household penetration in the 7 European markets in which we have launched Prime. There are huge growth opportunities ahead of us. European markets showing similar or better performance in France that was launched about 6.5 years ago. Please turn to Slide 25 of the presentation. Since very early days, eDO has been recognized as a leader in AI in Europe, always being a step ahead. If you go back to my first strategic presentation to you as investors, that's back in 2015, I said that we would distinguish ourselves through leading in technology that would enable great product and customer experiences. While others may be turning their attention now to AI, given that AI has had so much external press. We, however, have been doing this for almost a decade. For us, this is part of our DNA, and we have been repeatedly recognized for this. Google repeatedly acknowledged in public that eDO is one of the most advanced companies in AI in Europe. Please turn to Slide 26 of the presentation. For FY '25, we remain on track to meet our EUR 180 million cash EBITDA target and the Prime members in excess of 7.25 million members. In all, eDO has huge potential, superior returns for shareholders and customers while transforming and revolutionizing the industry. Furthermore, we are confident in the growth and profitability manifest in our guidance and also believe our stock is clearly undervalued. As a result, we're announcing today an acceleration of the share repurchase program for the remainder of the original 5.5 million shares targeted. We'll request the authorization from the Spanish Stock Exchange regulator to launch a tender offer for 4.5 million shares at a price of EUR 6.9. We will consider subsequent share buybacks as we continue to generate free cash flow on an ongoing basis. If you could please turn to Slide 27. I'd like to conclude by highlighting the strong fundamental growth potential we have beyond FY '25. As I said, Prime is only available currently in 10 countries. Yet as a transaction model, we're in 44 countries. Thus, as you can see over time, we'll continue to expand Prime to many more countries. Also within each country where Prime is already offered, we are nowhere near the normalized household penetration. This provides very good growth opportunity for us. Third, many successful subscription programs evolve into more segmented offers by customer product segments. These two provide significant growth opportunities for us. Overall, eDO is now a much higher quality business with the pivot to our subscription model. It delivers loyal and repeating customers, resulting in more and more profitable and predictable business. We are delivering high underlying profitability and have huge growth potential. Prime is a success has become firmly established. It has delivered significant uplifts in profit margins. That will continue because we have the right model, right people, right structure to seize and deliver on the exciting value-creating opportunities ahead of us. All of this will drive superior returns for shareholders, excellent service for our customers, while at the same time, transforming and revolutionizing the industry.

Thank you, Dana. And with that, we would now like to take your questions. [Operator Instructions] Now I am going to start bringing the questions. So the first set of questions that we have come from Francisco Ruiz of BNP Paribas. Let me just read them one by one. The first one says: "this year, we have the data on non-Prime bookings, and we have the whole figure of bookings?" Well, we're definitely a subscription company. And the number of transactions we've been saying now for some time do not determine the profitability of the subscription model. We decided a while ago to discontinue providing the Prime bookings as it is a KPI, which anchors investors on the transactional business mentality. That's not what really matters. What really matters is the number of Prime members, the ARPU and the profitability per member. In fact, by now, 88% of our cash EBITDA is from Prime members, and we really are a subscription, not a transactional booking business. And -- well, yes, that is it. Let me answer the next one. "How do we expect fixed costs to grow beyond next year?" We expect to be around EUR 108 million of fixed costs versus EUR 95 million of last year. And this is mainly driven by the annualization of the recruited people in fiscal '24. Let me repeat the obvious, but the EUR 108 million of fixed costs are considered within the EUR 180 million of cash EBITDA. The next question says, "what is the room for improvement in marginal profit margin from the 29% target in 2025?" Now I have to understand that the question is about the marginal profit margin. However, we have always said that it is much more practical to monitor the cash margin or profit margin, which is a better proxy for how our business is really doing. I actually made some comment on that on my prepared remark. We are currently on 32% as a margin for this metric for fiscal '24. And I've said that we expect this margin to improve by 6 percentage points over the next 12 months. So by the end of fiscal '25, we should be having a 38% cash marginal profit margin. And that's going to be driven by two things, like I also said. One, you're going to have an increase of Prime versus non-Prime. And second, you're going to have an increase of the cash margin or profit margin on the Prime side of the business due to the increasing proportion of year 2 and subsequent members in the program. Who, like we said many times, they're more profitable as they have much lower acquisition costs. The question says: "with the current leverage, will it be a good moment to start thinking about dividend payments?" So, we have shown, I think, very good metrics for cash generation, and we have also committed to increase very substantially, actually almost doubling, the cash generation for fiscal '25. Once the current process of repurchase is completed; and, as you know, we have announced that we will present a tender offer in the next few days, and that is good for 4.5 million shares at EUR 6.90. So that rounds up to about EUR 31 million. Once we're done with that, we will consider what other options to take for the additional cash that we're going to generate. And the last question from this analyst says: "why doing a tender instead of buying at the market as you are not offering any premium? Isn't it cheaper, taking into account that the shares are for LTI in 2027?" Well, that's if you believe that the share price from here to 2027 is not going to move. But obviously, we don't think that is the case. So it is a better deal for the company and all of its shareholders that we repurchase at the current prices, and that's what we thought with a tender offer. The next set of questions comes from Carlos Trevino of Banco Santander. The first one says: "about seasonality, historically, the fourth quarter was your strongest quarter in revenues in the year, but this year was behind the second quarter and only marginally above the first quarter. Which are the reasons behind this change in the seasonal patterns?" That's a very good question. Our revenue margin for the fourth quarter, which was EUR 168 million is pretty much on par with the EUR 169 million that we had in the second quarter. The decrease is due to the Easter effect, which this year fell on the last 2 weeks of March. And during the vacation periods, what happens is that the customers are not booking additional vacations. So whenever there is a clear vacation period, it is also a low seasonality period for us. The Prime segment is showing an improvement. But one other thing that you need to bear in mind, when you think about the seasonality now, is that as our business is more and more Prime, what happens is that the part of the subscription fees is happening with a 1-month delay from the moment that the customers are signing up for Prime. Because, remember, that the majority of customers what they do is they get into a free trial. So a customer that signs up in December, the subscription fees of that customer are actually being cashed in by us during the month of January. So, the Q4 from a subscription fee perspective is December, January and February, not January, February and March. And December is the lowest seasonality period of the year. The next question is about ARPU. "Why is Prime ARPU dropping from last quarter's reported figure?" ARPU is moving from 79.5% to 78.1%, which is a relatively slight decrease. And I think it's probably helpful for everyone that I remind how our platform -- how the algorithms of the platform actually work. And when they price the transaction, be it for first Prime booking, be it for a repeat Prime booking, they determine the pricing, specifically what discounts we give to the customers, depending on what they see generate a higher lifetime value for the customer. So you can have occasions in which there is better value for us long term in offering more discounts today, more discounts today implies lower ARPU, and that's what the platform is doing is making choices to ensure that the lifetime value of the customer is optimized. The next question says: "non-Prime working capital. Could you elaborate on the dynamics behind non-Prime working capital? Will it be dropping year-on-year? EVS, is it driven by volumes or by any other dynamics?" Okay. We understand that by non-Prime working capital, you're talking about the working capital, excluding the deferred revenue related to Prime, and that's great. We do not plan normally expecting that this amount is going to come in. And we have very consciously, from about a year ago, used a metric of cash flow to communicate with investors, which is free cash flow, excluding this non-Prime working capital, because it's something that we don't control. It's something that is determined by mostly the average basket value, i.e., the type of flights that the customers choose to select. And that number is on a trend of coming down and stabilizing and not going up yet. We're not seeing any improvements of going up versus the levels that they reached pre-COVID. So we don't count on that part. If it comes, fantastic, and this year, it was positive, but we don't plan on it. Taxes. "What is the reason behind the EUR 27 million positive tax income in your P&L in the fourth quarter?" Okay, this has to do much more with a mix of the past and the future and not so much about the present. And that is -- it is a little bit confusing, but it is how the rules of IFRS indicated that we need to operate. What happens is in the years of COVID -- let's say, 2021 to 2023, we had tax losses in the Spanish companies. Those tax losses were not activated. They were not recognized as tax credits in the financial statements up until March 2023, because there was insufficient forecast taxable profits for the compensation period of the 10 years and also because we were still in a period in which we're having negative net income. However, the forecast of the results of the Spanish companies has improved this year. The 10 years that we're looking at right now include more positive years, and we are having our first year, generally, as a positive net income. This resulted in the recognition of previously unrecognized tax loss carryforwards. So there is a note in the financial statement that you can look at, which shows the tax loss carryforwards recognized and not recognized in the financial statements. If you compare that note between what we published in fiscal '23 and what we have published in fiscal '24, you will see a movement of the same nature. Basket value. This is the last question from this analyst. "How has your average basket value evolved recently? And how it compared to pre-pandemic levels?" What we have observed is that the average basket size has not increased, and in some cases, it has even decreased. Currently, it stands now at levels of around EUR 370/EUR 380 per booking depending on which month or week we're looking at. Whereas the pre-pandemic levels were more about EUR 450, a little bit higher than that, depending on the month. This decrease is primarily due to a shift in the booking patterns. Our customers are making more frequent bookings but for cheaper overall alternatives. The next set of questions comes from Fehmi de Naamane from ODDO BHF. The first question is: "why are you speeding up your share buyback program? Is it linked to the low liquidity of the share?" And what I'd say is that the reason that we -- is in line with what we said in the prepared remarks, we have the cash available, and we think the price in the market is an attractive one because, in our opinion, the shares are undervalued. And therefore, the best decision that we can take on behalf of all our shareholders is to try to accelerate the program and repurchase as fast as possible with the current share price. The next question is: "you're anticipating a strong free cash flow generation in 2025 of EUR 90 million. Will this be used to deleverage or maybe to finance a new CapEx program?" Well, let's take steps one by one, no? Once the current process is completed, and we will then generate new cash. And that cash, it will be the decision of the Board, what to apply to. We have several options. There isn't currently a CapEx program that would need to be dedicated to. The only, let's say, extra CapEx that we have in mind versus what we have said in the past is what I said today about the EUR 6 million for the new back office, broken down by EUR 4 million in fiscal '25 and EUR 2 million in fiscal '26. That is a negligible amount compared to the EUR 90 million that we're going to generate. And it is also one that it's paying itself because we expect to generate EUR 2 million of cost reductions with the new big back office versus the current one that we have right now. So, yes, a meaningful part of it could go to additional buybacks. The next question is: "could you provide us an update on your package offering?" And I think this one would be better answered by Dana.