lastminute.com N.V. ($LMN)

Good morning, and welcome to the lastminute.com Full Year 2025 Financial Results Conference Call. Today's call will be hosted by Julia Weinhart, Head of Investor Relations; and joined by Alessandro Petazzi, Chief Executive Officer; and Diego Fiorentini, Chief Financial Officer. [Operator Instructions] Please note that this call is being recorded. At this time, I'd like to turn the call over to Julia, Head of Investor Relations. Please go ahead.

Thank you, Matilda. Good morning, everyone, and thank you for joining us today for our second call of the year. Today, we will present the final 2025 audited results as previewed in February. We have also this morning published our Annual Report and Sustainability Report 2025. These are now available on our corporate website. Along the results, we will share our latest development. And after the presentation, we will be happy to address your questions. With this, I will hand over to Diego now to start the presentation.

Thank you, Julia, and good morning to everybody. Today, we released our full year 2025 audited results, fully aligned with the preliminary figures we shared earlier this year. This resulted in a solid top line and profitability growth. Gross travel value grew 19% across the board. Revenue rose 15% to EUR 361 million, exceeding our guidance. Gross profit improved 10% even if we scale up our marketing investments. At the same time, we saw a meaningful acceleration in profitability. Adjusted EBITDA increased 33% to EUR 54.9 million, well ahead of our upgraded guidance, highlighting strong operating leverage. And importantly, this performance converted into cash with adjusted EBITDA less CapEx doubling to EUR 32.4 million. Overall, 2025 was a turnaround year marked by strong growth, improved profitability, disciplined cost management and robust cash generation. With that in mind, let's turn to the proposed dividend. The Board is proposing a dividend of EUR 0.41 per share for approval at the AGM in June, consistent with last year payout. While reported net profit was lower, this was mainly driven by one-off and noncash items related to the disposal of cruise business, which has been normalized. On this basis, the proposed dividend is fully aligned with our 30% to 35% payout policy and reflects the strength of our underlying cash generation. As Julia mentioned at the start of the call, our latest sustainability report is now also available and 2025 marks an important step forward in structuring our ESG approach. We have launched a new 3-year sustainability strategy built around 4 key pillars, each closely linked to our business model and long-term value creation. Ethical and transparent governance now extended across our value chain; climate and environment protection, which includes our road map to net zero by 2050; people and community impact, focus on culture and local engagement; our customer experience and responsibility tourism, supporting better and more conscious travel choice. Overall, we are embedding ESG into how we operate to serve customers and grow the business, strengthening resilience and long-term value creation. In the sustainability report, we are also highlighting some important external recognition. In January 2026, lastminute.com received MSCI ESG rating of AAA, positioning us as a leader in managing ESG risks and opportunities within our industry. In addition, our inaugural disclosure of the Carbon Disclosure Project also saw the group achieve this score. This is a strong debut for our commitment to transparency and high-quality environment data disclosure. Together, this recognition validates the robustness of our ESG framework and are fully consistent with the discipline and quality reflected in our audited results. Overall, this demonstrates that we are not only managing risk effectively, but also positioning the business to capture long-term opportunities. Let me now wrap up with the key takeaways. We delivered strong 2025 results fully in line with the preliminary figures shared in February. It was a turnaround year. We achieved double-digit revenue growth with profitability accelerating in second half and exceeding our full year guidance. Cash conversion was strong, supporting disciplined capital allocation and dividend distribution. Rigorous execution and focused effort drove these results, leaving us well positioned for 2026. With this in mind, I now hand over to Alessandro.

Thank you. Thank you, Diego. And just a couple of more words about our 2025 results. Of course, they're not new, you had already seen them in February, but I think it's important to underline that we've been growing not only more than our guidance, we've been growing more than the market, and this is a reflection of the choices we've made throughout the year of the change we had in our approach to product, to marketing, to market expansion, and I would say, in general, to our strategy. So delivering top line growth, but also strong cash flow generation, which is what allowed us to have the same dividend payout year after year. So -- which we think is important, as I said, upon joining the company that it's important to prove that we can grow more than the market on the top line, but also having very strict and disciplined cost control and more than proportional cash generation. So I don't think this is a trade-off. I do think that we can achieve all of these results. And actually, we have achieved them in 2025 as part of our strategy. Now clearly, we're now focused on 2026 and the following years. And so talking about the strategy, I would like to give you a quick update on something that we're doing to, I would say, close the loop on all the strategic refinement that we've been doing over the past few months. So when I talk about owning the customer experience, you might probably remember that we've been talking many times already now about the fact that the company used to be a distribution platform basically with a pretty transactional approach, getting customers coming mostly from metasearch channels such as Skyscanner and selling flights to them. Over the years, there has been a progressive transition towards being more of a provider of package holidays. And right now, we are really completing that transition. So you might remember that we've been discussing about our strategy being much more of a product-led organization, really focused on owning the customer experience. And I would say, moving up the value chain in a way. So I'm not accepting to be just a distribution layer, but really being more and more in control and responsible for the customer experience throughout their entire holiday, not only in the moment of booking, therefore, as we were used to be, but also from the booking to the moment that people go on holiday and during the holiday itself. So this strategic transition, which we already discussed with you a few times, we felt that requires also an adjustment into our broader mission statement to reflect the new company that we have become. And I think it's important for companies in general to always start with the why, right, to start with the reason why we exist. I know that most of you connected to this call are mostly interested in our financial results. And the financial results are just a consequence of what companies decide to do, why they exist, what do they do for the customers, if they're able to provide real value for the customers. And so this is not just a sentence, but this is the way that we're going to -- the guiding principle that we're going to use to make the choices that will shape our future. So that's why we have updated our statements in terms of purpose. So the purpose of the company is really to own the complexity of travel, so people can discover the world. We know that travel is a complex world. But at the end of the day, we care about the value that we can bring to customers, which is really allowing them to have that peace of mind that they can focus on the fun part of travel while we focus on the difficult part of travel. And if this is the reason why we exist, what we want to achieve is to be the definitive -- the travel curator and companion. Again, taking that responsibility. And in terms if we go to our mission, so how we will achieve this is by designing, delivering and taking responsibility for travel experiences so that people can travel with confidence. You will notice that on this page, you don't see the word technology, you don't see the word AI that now everyone kind of sprinkles everywhere as a buzzword. But I think that this is not because this is not important. This is crucial. But I would say it's how we do things is the underlying pillar that allows us to deliver this value for the customer. But we really wanted to be adamant on the fact that at the end of the day, whatever we do must serve a purpose in the eyes of those who travel. And then how we do it, the complexity that is under the hood, the complexity of our technology, the fact that we are now using AI on all our processes, and we will share some more details about that as we did in the last presentation, we will also do that with some announcement in the next few weeks and with some more details in our next investor call. But again, this is about the how we do things. This is the why. And actually, this strategy and this model also have consequence and direct impact on numbers on also the latest trading update because I'm sure, moving on to the next topic, I'm sure that this is what is on everyone's mind, right? What is happening in the Middle East, how this is impacting the travel industry, and I'm sure that a lot of you have questions about how this is impacting our company. So I would say that I have good news for you here, especially compared to what we've been hearing from a lot of other companies in the space. So let's start with some data points, right? First one is that to date, 17,000 bookings of our customers were affected by regional disruption in the Middle East. And that might sound like a lot, 17,000 bookings. But just please remember that every single year, we have over 3.5 million bookings. We help over 6 million people to travel every year. So 17,000 bookings is the amount of bookings that we typically sell during 1.5 days of trading. This is to put things into context. This is the element of disruptions and cancellations we've seen. And obviously, these have been concentrated in the month of March when the crisis hit. And going forward, of course, we are seeing and expecting much, much smaller number. I would say it's almost like a one-off effect of March specifically because then clearly, certain airlines stopped selling certain destinations. We also stopped selling certain destinations and people stopped booking certain destinations. So in terms of cancellations, the big effect is the one-off effect in March. But then, of course, you might be wondering, well, yes, this is cancellations. So it's really tiny for you, but what about the month? I know that you've been hearing some traditional tour operators or even some online players saying, well, actually, we saw a decline in sales of 15%, 20%, 25%. Is that the case for lastminute.com? And the answer is absolutely not. So actually, I can already anticipate we will -- as you know, we will give full Q1 results at the beginning of May, but I can already anticipate that Q1 2026, we've been growing compared to Q1 2025. And of course, January and February, more than March, but we've been growing. And even in March, we've been resilient. And why that? And I think back to connecting that with the strategy that this is a function of our model from a number of points of view, right? So one element of our model is that we have a lot of different source markets, all in Europe, but we're not concentrated on one market. We're not a U.K.-only player. We're not an Italy-only player. And this is very important in situations like this. The U.K. and Italy are the 2 markets that have been mostly impacted in terms of demand generation. Mostly -- I mean, from a practical point of view on certain routes, specifically. For example, a lot of Italians were planning to go to Sharm in Egypt for their Easter holidays. And clearly, that didn't happen. So if you are a player focused only on the Italian source market, obviously, this is going to hit you badly. But in our case, thanks to the fact that we have Northern Europe, Germany, Eastern Europe, other markets -- France, other markets with different preferences in terms of destinations, and also a broad portfolio of offers so that demand can shift from certain destinations to others, we were able to actually absorb that. So for example, as we can see on the page, destinations such as Spain, Portugal and Italy have been growing over 10% year-on-year, compensating the shift. And to be honest, in the past few days, I mean, we've seen, of course, a decline in March of destinations such as Turkey and Egypt, which even if not directly impacted by the war, were perceived to be in a potentially risky position. The reality is that the very last few days we've seen even these destinations recovering as if there was a big moment of panic at the beginning and then progressively people are gaining confidence, again, when they realize that certain destinations are not directly hit. This is not the only thing. So our model, yes, selling mostly Europe to European travelers. So in a way, being a bit insulated by all of this, but that's not the only thing. The other thing is that products, right? I mean we -- of course, we are -- we said it that the core of our business is selling package holidays, being an integrated travel provider, but it's not a coincidence that we still also offer flights-only and hotel-only as an option to our customer, precisely to be resilient in a moment like this. And I'll tell you a bit more about this in a minute. So if we take a look at the market from a broader point of view, there are some data that we've been also discussing with Google to just to expand the view from the data that we see for our customers and the data that we see for the market as a whole. Demand data, right, letting aside how we can actually convert that demand. And for sure, there has been a few interesting effects. So pretty clearly, a timing shift that consumers are delaying purchase decisions, but they're not canceling. So we're seeing that there's like 17% of searches of people that are considering a holiday, but they've decided not to complete the purchase now. They will say, "Well, actually, I will complete my purchase for sure, but I will complete it in the next few weeks." So people that normally would book in March saying, "Well, maybe this year, I'm going to book in May or June." People who say, "Well, actually I've been planning but I'm still not sure if I want to go ahead. I will decide later on." So that's a key thing. And by the way, I think that in this context, our brand positioning as lastminute.com, can actually come pretty handy because we expect that, especially for the holiday plans for summer, clearly, having a last-minute booking will be something that will come naturally our way. The second element in terms of demand is the fact that we've seen a shift in searches from packages towards stand-alone flights and hotels. So especially in certain source markets, people are like, well, rather than committing out to package holiday, I will maybe drive my car at certain destinations and book just the hotel or I will fly for a city break rather than going into a summer holiday destination already for Easter. So a lot of people that were planning for Easter being also pretty earlier, right, this very weekend, they said, well, actually maybe flight-only makes more sense for me in this space. Well, and again, the beauty of our model is that we can serve those customers as well, and this will be reflected in our Q1 results. So that our flight-only business is doing very well precisely for that. And again, it's not a coincidence, right? I mean I got a lot of times from also maybe from some of you on this call, the question, well, if package holiday is your core business, why do you keep offering also flights and hotels only considering the added complexity that this has. And of course, being on multiple source markets, providing multiple products adds complexity, and as I said a few minutes ago, we have to own that complexity because that complexity, if we manage it well, with the technology, with AI, and we make it simple for our customers is exactly what makes us also resilient in situations like this. Last but not least, we're seeing that because of the current situation, trust and flexibility, which are always important components when booking a holiday, are becoming even more important as the risk mitigation factors, even more than price in the current moment. And we're doing something about this because, again, I've been talking about market trends, but let's not forget that we are managing the company. We're not just kind of passively accepting whatever trend the market offers, we're proactively engaging and changing the way we operate to leverage the new situation. So for example, we've changed over the past few weeks, our marketing approach by obviously focusing on certain destinations and on certain products rather than others that we would normally be focusing in March and April. So that's one thing. We've now testing a new cancel for any reason product. So kudos to our product team that very quickly could come up with a product cancel for any reason, which is precisely tailored for the type of an anxiety that is now gripping travelers. We're testing in a few markets and see, obviously, if we can roll it out progressively to other markets very soon. Clearly, not including Middle Eastern destinations, I mean, needless to say. But again, even in destinations which are completely not impacted by the current situation, people have this -- want this peace of mind, and we are there precisely to offer that peace of minute. So for example, also to promote refundable rates of hotels more than the nonrefundable rates. A lot of things, big and small, that normally are the things which happen under the hood, which we don't necessarily promoted during these calls, but are the things that justify the fact that in Q1, we've been wrong. It's not just because we're lucky levering a certain market demand, but because we are changing our strategy to do it. And so our asset-light model, diversified product portfolio and focus on selling Europe to European travelers is really helping together with the actions we're putting in place. And all of these things being considered, I mean, I know that you care about the why and the how, but at the end of the day, you care about the what, in terms of financial results. And this is why in a travel sector, in which a lot of players are predicating doom and gloom and are saying that they're either lowering or canceling their guidance, in our case, we stay steady, and we confirm that we expect to be growing in 2026. We've been growing in Q1, and we expect that we will see that growth for the entirety of the year. Obviously, this is predicated on certain assumptions. For example, you might know that Ryanair and easyJet are the 2 main airlines that we work with. And up to now, we have not seen a significant growth in their pricing. Probably they were good in hedging themselves against fuel, possible fuel cost increase. I know there's been a lot of conversations in the industry about the travel, for example, affecting other airlines such as Volotea, but, for example, airlines like that are not important in our product mix. So again, the type of product that we have, it's also true that in situations like that, someone who's really efficient and providing good pricing, focusing on the budget end of the market is normally thriving, and this is exactly what we are typically in these situations, those who are at the extremes, the superluxury providers and the budget providers thrive, the ones in the middle probably have some problems. So the fact that we're able to have very good pricing with a very efficient cost base allows us to be well positioned to capture the change in demand that we're seeing in this moment and of course, also the last-minute demand that we should be seeing in the next few weeks and months. And with that, I think I can hand over to Julia for our financial calendar, and then we can take your questions.

Perfect. Thank you very much, Alessandro. Here, you have a brief overview, and like always, of our latest publication dates and the conferences we will be attending throughout the year. With that, we will be now beginning the Q&A session, starting with live questions first, followed by those submitted via the webcast. Please note that similar questions, we may have regrouped to answer and slightly rephrased. In line with our privacy and data protection policy, we remind participants that stating your name when asking a live question is optional. With that, I will hand over to Matilda now, our Chorus Call operator, to begin with the first live question. Thank you, Matilda.

[Operator Instructions] There are no questions at this time over the phone.

Thank you, Matilda. Then we will move to the webcast questions we have received this morning. I will start with the first question. You delivered a remarkable performance last year. Could you elaborate on why the Board has chosen to keep a dividend of EUR 0.41?

Okay. Julia, I'll take that. I think we already discussed briefly during the presentation. But in general, the dividend of EUR 0.41 is calculated after adjusting for the nonrecurring and noncash items related to the sale of the cruise business. If you remember, this happened at the end of the third quarter. And these adjustments in total account for approximately EUR 2.7 million. The Board proposal is based on the decision to neutralize this impact. And by normalizing this effect, the distribution sits at 33% of the net profit, which is in line with our dividend policy.

Thank you, Diego. Now moving to the next question. Did you see significant changes in the booking patterns after the breakout of the Iran war?

Well, I strongly suspect that this question was written before and I ask my colleagues for confirmation, if they saw the question coming up before. I presented exactly this in 2 pages of our presentation. So I guess it would be pretty boring for everyone, if I repeat exactly what I said about that. I think I covered that in terms of the source markets, in terms of the destinations, in terms of the timing and in terms of the type of things which are more relevant for customers now, and I would say, more relevant for us, not just how the market is changing, but our own response to that and our pro-activity to make sure that we can actually benefit from this situation, also taking advantage of our lastminute brand. So I think I already covered in pretty much detail this one. I think we can move on to the next one. And obviously, if the person who asked this wants to follow up, they're more welcome to do so, either unmuting themselves and asking live questions or writing a new question on the web chat. Thank you.

Thank you, Alessandro. Moving to the next question now, congrats on the successful year 2025 and the achieved ESG rating. Revisiting the financial liability section, specifically the additions column that represents new loans and credit lines secured within the period, what is the main purpose of usage of the uncommitted bank loans?

Yes, Julia, I'll take that. Well, the usage of the uncommitted bank loans is typically bridging the end of the travel season in November of each given year and the start of the new season at the beginning of the following year. If you look at in the past, the utilization has been going down each and every year, and this is reflecting our improved cash position. I already mentioned during the preliminary call that already in mid-February, all those uncommitted credit lines were already repaid, and we were debt-free.

Thank you, Diego. Moving to the next question. Do you think the European travel industry will be a winner from the uncertainties coming from the Iran war situation, specifically for summer bookings?

Well, I'll take this. Well, I mean, of course, geopolitical instability is never a positive for the world as a whole, for global economy and for the travel market in general. And obviously, as travel professionals, we want the industry to work together in this moment. But it's also true that the, I would say the pan-European market historically has been acting as kind of a safe haven during volatility in other parts of the world and in this case, Middle Eastern, specifically. So as we already discussed, we're seeing this redirection of demand from people who previously considered Middle Eastern regions now shifting their searches and their bookings toward Western and Southern Europe. So I would say that our strategy, which is very intentional about offering different products to serve different customer needs by operating in many source markets and of course, many destinations as well ensures that we're not exposed over a certain threshold to a single product or geography. So I think, again, the important thing is that in terms at least of people searching for their holidays, we're seeing that there is a shift in where and when people choose to travel, but not as much in the terms of volumes. I mean there is a resilience in terms of willingness to travel and availability of discretionary spending for travel. So I think this is very important.

Thank you, Alessandro. Moving to the next question. You previously announced plans to integrate into AI ecosystem such as ChatGPT and Gemini. Can you update us on the current status? And how far along are you in that integration? And are there already live use cases?

Yes, yes, yes. Well, actually, there are already. I think this is composed of 2 different things. So on one hand, we have to prepare the infrastructure on our side, so the MCP server. And in that sense, we have already done it. So we started with the MCP server for flights to provide live inventory via that way. And then more recently, we've also done it for our holiday package for our dynamic packaging products. So that part has been developed. And now it's a matter of integrating that into the front end, I would say, of the various chatbot providers. So we started with Anthropic with Claude, integrating our own app there. And we've now submitted as well our app to OpenAI for their own approval and release. So we will be updating you in the very next few weeks. It's a very -- it's something that will happen very, very soon, depending obviously on their own timing for approving and publishing our product within their ecosystem. But yes, it's happening now. It's not a far-fetched thing happening in the future.

Thank you, Alessandro. Now moving to the next question. Do you expect any one-offs or special costs during 2026, like where you have seen them in 2025?

Yes. So in 2025, the one-offs were clearly identified and were related to the organization we put in place in June 2025 and subsequently sale of the cruise business. So those were really one-offs, and we are not expecting those to happen again in 2026.

Thank you, Diego. Now moving to the next question. You are generously undervalued against the sector multiple. Do you think that using cash for expansion strategy M&A could be a good move for the business and also trigger for rerating?

Well, I mean, in terms of -- right now, as we said, we are in a much stronger position in terms of our cash flow and in terms of cash that we have on our bank accounts. And I think that there are very -- some very interesting uses for that, that we can have in order to improve our economics. For example, one thing that we're doing is that we are prioritizing paying a lot of suppliers with prepaid cards on which the -- the more technical word, I'm saying kickback, but kickback is not the technical word.

Revenue share.

The revenue share of the card providers is higher than on credit cards, right? And I think that we have other examples and that we are considering other examples in which potentially anticipating payments to certain providers can provide us better economics and better unit economics. So of course, we are always potentially opportunistically considering if there could be start-ups that we work with, that are doing something interesting and that sometimes in a make or buy decision in terms of especially certain technological developments, things related to AI or not only that, could be done by companies outside of our perimeter rather than by us, but this is the thing. So really focused on using that cash availability for industrial purposes rather than, for example, for considering a big merger with an equally sized company, if that's the question.

Thank you, Alessandro. With that, we have, at the moment, no more webcast questions online. Matilda, do you maybe want to recheck if there are any live questions at this moment in time?

Yes. We now have a question from the line of Volker Bosse from Baader Bank.

Volker Bosse, Baader Bank. I would like to come on the marketing costs, which increased year-over-year in '25, in line to your guidance. So is that trend going to continue an increasing share of marketing in percentage of sales, so to say? And also in which areas, in which regions you spend more on marketing? I mean, not region, by countries, more is it off-line, online marketing in that regard? Second question is on headcount. I mean it remains stable year-over-year at year-end. Is it going to continue? So do you plan any hiring? So consequently, maybe then the personnel costs in percentage of sales should go down? And is that also the way how to model the year '26, your guidance is sales and adjusted EBITDA to grow by 10%, means adjusted EBITDA in line to sales, marketing sales in percentage of revenues going up, personnel cost in percentage of revenue going down. So coming then to the, so to say, flat margin progression in '26 potentially. Is that the right way to look at it?

Volker, nice to hear from you. I was worried not to hear your questions. So thank you for assuring us in that sense. Yes, I mean, okay, marketing. So marketing, yes, it's been growing in absolute value. The logic that we have for marketing is basically that we want to have very healthy unit economics, right? We want to make sure that our -- the lifetime value of the customers that we acquire is always at least 2x the cost of customer acquisition. Everything that satisfies that threshold basically provides us a direct positive impact on our gross profit in absolute value. So that's what we care. We do not care about the, I would say, aesthetics of a gross margin percentage. We care about the fact that if we spend EUR 1, we get EUR 2 back. And therefore, we have a positive contribution to our absolute gross profit with them, which then remunerates the fixed cost and provides the operating leverage that we've been talking about. So this is the overall logic. Now in terms of the specific markets in which this has been focused. Of course, as you know, we have been -- we started to invest in what we call expansion markets in 2025, and we plan to continue doing that in 2026. The results are very positive. Of course, there's a lot of markets in which our brand is not known because we never invested there. And so it is structural and normal that from a relative point of view, the return of that additional euro spent in that extra market is potentially lower than the return of that additional euro spent in the core market, but up to a certain point because, of course, in the core markets in which we've been active for over 20 years and in which there's a lot of competition, of course, you also have to consider that. So in other markets, we really have the possibility to make inroads. I find it very interesting, for example, that in some Eastern European markets, after less than 1 year of operations, we are already among the Top 3 most searched travel operators, if not in some markets, even the #1. Obviously, these are markets which are a fraction of huge markets such as the U.K. or Germany, but I think it's been very interesting to potentially be achieving a leadership position in these markets very, very soon. But again, always with that discipline, but we want extra euro of marketing investment to provide at least EUR 2 of positive impact on the P&L. So that's one. The second question, yes, of course, as you might remember from all the data we shared last year, we reduced our headcount by 120 people last year. But then obviously, at the same time, we also hired people in new roles, so a bunch of AI engineers and other people that -- in roles that are more coherent with the type of evolution that we're seeing as a company. But for sure, if you look at it from a broader financial point of view, the cost of personnel as a percentage of revenues is definitely going down. And I would say this applies in general to all the fixed cost. So this is one of the key, by the way, also internal KPIs that we monitor, the percentage of fixed cost on revenues, and we've been going down significantly from -- in '25 compared to '24, and we plan to continue '26, '27, '28. That's definitely something that is going to be consistent over the next few years.

And I see we have one more last question. So Matilda?

Yes, okay. If there's one more live question, we pick that, and then we see if there are other follow-up questions after this.

The next question comes from the line of Tim Kruse from Montega.

I have 2 questions. Actually, the first one would be sort of on your -- yes, if you could shed some light on the price effect. You mentioned that Ryanair has not raised prices yet, but how do you expect that to pan out if that does happen? I mean there's probably a demand effect, but there's, on the other hand, sort of an average booking value effect? And how do you imagine that to balance out? And the second question is in terms of capital allocation, you mentioned potentially M&A. But however, looking at your valuation at the moment, what do you think about the capital allocation in terms of actually share buyback, seeing the low valuation you currently have?

Thank you. Let me answer -- let me start with the second element because this is the typical thing on which it's easy to have a misunderstanding. I'm not saying that we're considering M&A. That's not the point. No, we're not actively considering M&A. We are considering using -- prioritizing the use of our cash flow and cash resources for industrial reasons. I said switching more of our payment to prepaid cards, potentially anticipating payments to some suppliers in exchange for better economic conditions, better rates, discounts and stuff like that. So using our balance sheet and cash flow to improve our P&L in a way. That's the priority. Then I mentioned incidentally that, of course, if there might be something really small and very interesting from, but almost as a technical investment rather than developing certain things inside, in-house rather than doing an acqui-hire, we might consider that, but that's it. I said that precisely to rule out big M&A operations. So it's the opposite. So I want to be -- I hope this is very clear because let's not have misunderstanding. I would hate to see a headline of lastminute prioritizes M&A, right? No, this is absolutely not the case. So I hope this is clarified. I'm not sure I fully understood the first question, to be honest.

Thanks for clarifying that. That's very, very clear. But how do you think about share buyback in terms of capital allocation? And the first question was you mentioned that Ryanair, obviously, is a big and important partner, and you specifically mentioned that they have not raised prices yet. I was just trying to understand your thoughts on that because, obviously, there is an effect of price increases on demand. On the other hand, I presume your average order value or the booking value increases, which is on a direct comparison basis positive, right? Or is that a wrong thought?

Well, not necessarily. I mean it depends, look, at the end of the day, we need to be competitive in the market, right? So especially for our packaged holidays, I mean, when we're selling flights only, obviously, the comparison, especially for people who use metasearch channels is very easy. And even EUR 1 of difference can make a difference in terms of conversion. So we have a very sophisticated system to make sure that we price a specific flight in a way that we can be both competitive and profitable. And most of the time, the profit comes more from the ancillaries that we sell on top of the flight-only seat, I would say. And we have a complex system that takes into account statistically what type of ancillaries we typically sell on top of the seat and therefore, the profitability we can expect from that seat. And therefore, if we can potentially discount that seat compared to the official price or not. And of course, with different airlines, we also have different limitations in terms of how much we can discount or not discount their face value. So for the flight business, I would say, it's very mathematical and it's very -- and I think the success in our growth and profit is precisely because of the progressive improvement of that and progressive improvement of the ancillaries that in terms of both the availability of ancillaries on our product mix and also the pricing of ancillary together with the pricing of the flight seat. So the 2 things clearly go hand-in-hand. With dynamic packaging, obviously, when we sell a package, again, we need to be competitive in the market with -- on the beach, with loveholidays, with TUI, with all the various competitors we have in the various markets. So if flight prices will raise for everyone, you can expect that potentially also package prices will go up, but this is very speculative. We don't have indications right now. So if and when that will happen, then we will face it, but I would say, if it happens, it's not something that will impact only us. It will be a general industry situation, and so we will see. The important thing is that we maintain pricing, which are competitive for our customers. In terms of capital allocation, share buyback, again, let me reinstate that the focus is on industrial usage of our cash. So the priority is on that, to help us improve our P&L and even further improve our cash flow. This is the priority right now. We did share buyback, as you probably remember, consistently for a pretty long time. We could do it in the future. There is a general blanket, I would say, approval in that sense that we are still ongoing. Not a short-term priority because we think we have more interesting uses to improve, first of all, the industrial performance of the company.

Matilda, are there any more live questions at this stage?

That was the last question. I would now like to turn the conference back over to Alessandro for any closing remarks.

Well, thank you, Matilda, and thank you, everyone, for joining us. I hope it was informative. Normally the call in which we talk about the audited results is maybe the uneventful one because, of course, the results are the same that were already presented a bit over a month ago. In this case, probably it was a bit different because of the Middle Eastern situation, and I think that everyone was interested in a trading update. So I do think that -- I do hope that the key messages that we wanted to pass did come across. So we are -- we have been growing in Q1. Of course, the situation is impacting the market and everyone, but us, I would say, probably much less than others, not just again because we're lucky, but because of the conscious choices that we have been making and that we are making now to address the situation. And obviously, we're closely monitoring how things evolve and see whether there are even more opportunities for us in this context. And with that, I look forward to seeing you again on the 6th of May for our official Q1 results announcement. Thank you, everyone.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.