Novaturas AB (NTU1L.VS) Earnings Call Transcript & Summary

Good morning. I would like to welcome you to Novaturas quarterly meeting with investors. I am Amelia, an account manager at NASDAQ business, and I'm delighted to be the moderator for today's event. The agenda couldn't be simpler. We start with a presentation from the management, which will be followed by the Q&A session. [Operator Instructions] With that said, I'm pleased to introduce today's presenters, the CEO, Audrone Keinyte; and the CFO, Tomas Staskunas. Dear guests, please, the floor is yours.

Good morning, dear investors and members of financial community. Thank you for your interest in Novaturas Group. Today, we will present the financial and other performance results of Novaturas Group of 2020. The presentation will be held by me, the CEO of Novaturas. And together with me, we have also Tomas Staskunas, who is the Financial Director of Novaturas Group and will also assist me in the Q&A session. So first of all, I would like to have a short review of 2020, which has been heavily affected by the COVID-19, whereas most of the business sectors worldwide have been affected by the virus spread. But for sure, the tourism, aviation and hospitality sectors are the most affected investors worldwide due to COVID. So talking about 2020 performance overview, first of all, I would like to have a short overview of all -- each quarter. So the first quarter, we have started very successfully. We had a very strong January and February. And unfortunately, at the end of February, due to the COVID spread in Europe, we had a decrease in operation, and we had to stop our operation completely in the middle of March due to worldwide lockdown. The second quarter, we had completely no income due to the lockdown and no possibility to operate any flights and to generate any income. During the third quarter, from July, after the restrictions of the movement inside the European Union have been relieved, we could partially operate -- restart our operation. But unfortunately, very complicated and very unstable regulations of the government, the restrictions have been changed very much dynamically, and also the reaction of the market did not allow us to have a stable and proper operation. Unfortunately, we had to stop our flights to certain destinations several times. And in the next slides, we will review as well which destinations could be operated during this period. The fourth quarter, again, due to the second wave of virus spreads, has been under lockdown. On the other hand, during October and during December, we have managed to operate several flights to certain destinations during the festive period. So it's -- and the school holidays, so it allowed us to generate a small income during those periods. So yes, talking about 2020, we have had, I would say, mainly the crisis handling, also taking any possibility to operate some destinations and to offer the holiday possibilities to all Baltic markets, but it was a very complicated and difficult operation due to changing regulation and virus spreads worldwide. Now talking about 2021. First of all, due to very difficult and negative virus situation in the Baltic markets, during January, we have decided not to do any kind of business activity. On the other hand, from February, we are restarting the flights to the main winter destinations. So we have started already the flights to the Canary Islands to the different destination. As well, we are restarting flights to Egypt, to Hurghada and Sharm El Sheikh, from Lithuania and Estonia. Also, we are offering the holiday possibilities to our clients in Dubai and Maldives from February -- during February and March months. So we are offering those destinations which are accepting the tourists, which have adopted the health measures and where the -- we have also the flight possibilities. Talking about skiing, which has been also quite a significant part of our winter product. Again, due to difficult situation on the skiing resorts and also changing decisions of the governments of those countries, which are having the skiing infrastructure, we are not planning to operate any flights to skiing destinations, well, out of our skiing portfolio, which is France, Italy and Andorra. Unfortunately, France is completely closed, Andorra as well. And Italy is still under question whether it will reopen. But again, it is already at the end of the skiing season. So talking about the 2021 and especially in the short-term traveling situation. Currently, unfortunately, we still have the virus spreads and the epidemiological situation quite negative worldwide. The restrictions are continuing. On the other hand, what we are facing and the market reaction is completely different. There is a strong will and thirst to travel. And considering that we are very accurately choosing the destinations in terms of the safety measures, and ensuring that all the health and safety -- health safety measures are implemented in all the chain of the, let's say, travel, of the trip, we can see that it is -- that travel is coming back gradually. And of course, the vaccination will enable us to come back to more usual traveling reality. Of course, the vaccination is still -- there is still quite a lot of uncertainty regarding the vaccination processes in each country and also Europe-wise, worldwide. And since tourism is very conversely worldwide business, it is important that there would be, let's say, a uniform strategy, vaccination strategy. This would allow the tourism industry worldwide to recover much more fast, and for the clients, of the travelers to start traveling with much more confidence. Now talking about our forecast. We are still maintaining the suspension of the forecast during this uncertainty. So until there is more certainty with the vaccination and the regulations, we would not forecast. On the other hand, due to the very frequently changing situation of the virus spreads and the governmental decisions, we are also forecasting and planning our future activities in shorter terms than usually. We are usually setting the main milestones quarterly so that we could assess and easily adjust for the changes. So shortly at this point, it is still very much impossible to provide a forecast. Of course, this is a factor of future activity and future performance with the vaccination strategies and general conditions for traveling worldwide. Now talking and considering our key financials. As usual, we consider 3 main indicators. First of all, revenue. Due to very complicated operations, flight operation during the third -- last year -- or let's say, biggest part of the year 2020, we have managed to generate EUR 33.1 million of revenue, which is much, much lower compared to 2019. During 2019, we have had almost EUR 180 million of turnover. Talking about EBITDA, we have a negative EBITDA of EUR 2.6 million. While in 2019, we have achieved EUR 4.3 million of EBITDA. Our net loss is EUR 5 million. While in 2019, it was EUR 4.2 million of net profits. The net loss is also very much affected by the financial activities, such as hedging and other factors. But we will go further to the financial indicators in the next slide. On this stage, I would also like to point all the actions that the management and the Board has taken to control the crisis and to manage to cope with it in the best way. So I would think during the biggest part of the year since the end of February 2019, we have continuously -- we have been working on several directions. And I would present in more details a big part of them. So first of all, of course, since February, we have moved towards a very strict cost control. So the cost optimization was one of the key actions and the main actions that the management has done in order to minimize the effect of the crisis. As well, in order to achieve the minimized costs, of course, we had to review all the processes within the company, the structure and the processes. And here, we have focused a lot on operational efficiency and the organization of the company in the past where it -- we saw it necessary. Third point. We have continuously been -- having the dialogue and discussions with the government in the Baltics, so that to be -- to have the possibility to raise all the main issues of the tourism sector. And of course, to use all state aid measures, which have been -- which have applied to the sectors that were affected by COVID as well that were affected, specifically for the tourism sector. As well, we have been -- since February, we have had continuous work with our existing clients. Usually, our sales are very much on the booking sales. So majority of the clients for summer '20 have been booked earlier, and we had more than 50% of our capacity sold already. So we had to take better price decisions and to materialize them. Also to agree with our suppliers, so that to be offered -- to be able to offer to the clients the best options for the clients. Then as well, we had to adapt our products, and we had to act and to be proactive in terms of this. So we have launched a new product, the multi-product in all the markets. As well, we had to start our next season sales and to open our destinations portfolio much earlier than before. So we have summer '21 already from April in our portfolio. And also, we already are selling the next winter, winter '21, '22. Also, we had to adapt very fastly to the new reality and to adapt our conditions, our booking conditions and other extra services, considering current traveling reality. So we have implemented very flexible booking conditions, launched new service such as "COVID PAUSE." So all those points I will present a little bit more in details in the next slides. As well, continuously, we have been working with our partners, the retail agency small markets, so that to make sure that we are handling our clients properly, to make sure that the financial and other risks are controlled. And we continue having a very, I would say, close contact with all our partners, retail agents in Lithuania, Latvia and Estonia, so that to ensure that tourism sector comes back to the healthy status as well as to ensure that our clients are being served properly as in the best way. Further, continuous negotiation with the suppliers regarding the prices and more flexible conditions. So again, that has been done from the beginning of the crisis. We had to review our existing commitments. We had to review our existing contractual conditions to make sure that we are achieving to the best, most flexible contractual conditions, as well as to the most attractive prices from our suppliers, so that to maintain our maximum competitiveness in the market and we maintain our leadership position in the market. Finally, we have managed to retain prepayments from the partners abroad. So we have refunded around EUR 8 million, more than half of our prepayments from the destinations. Again, that's the specifics of the tourism business. Usually, the part of the business is being prepaid by the early booking prepayments or down payments for the commitments. So due to the expectations of summer '20 and very positive indicators, we had -- we have had quite big prepayments to the destinations. And due to the efforts of our management as well as due to the direct operational approach from our partners support, we have managed to refund the part of the prepayments. Now I would go to certain -- some of those points, and I would present them more in details. So first of all, I will start with the operating expenses, which were under very strict cost -- under very strict control since end of February. So during the 2020, the whole year, we have managed to reduce more than the total operating expenses, excluding commissions and one-offs by more than 46%. And also as a very important indicator, I would like to mention that during the last quarter, it has been reduced by 61.7%. So it shows that we were going on the -- even more strict cost control each quarter. Now during 12 months of 2020, we have had EUR 6.8 million of operational expenses. This is already good in commissions and one-offs, and this is almost 3x less than we had in 2019. We have had more significant amount of one-off expenses, which is related to the bad debt related with the bankruptcy of one of our retail agencies, as well with the accruals that also are related with the closure of one of our daughter companies and certain other one-off expenses. So in general, the figures mentioned, which, again, considering the industry and considering the tour operators' model and considering the results that other tour operators worldwide have achieved, I would say they are above the industry. So it shows that it reflects our strong cost discipline and also contribution from the operational opportunities. We have been working during 2020 very -- with the [ volume ] received accurately with our organic heads related to the employment. We have been forced, of course, to reduce our team by certain percentage. On the other hand, we did not compromise the quality. And of course, considering the -- all the challenges that the crisis has brought, we have managed to maintain a very professional and very resilient team. So talking and considering our -- the challenges and very, I would say, difficult work environment, and we are -- from the management perspective, we are very grateful to our employees who proved to be very resilient and professional. As well, this -- those numbers are also reflecting our, as mentioned, our rather continuous cost optimization and efficiency increase. So we managed to increase the efficiency of our processes. And finally, the asset-light model or lesser flight nature of our business and also flexibility together with the actions that we have done since March, mean that we are better -- well placed to capitalize on the inevitable structural changes in the market of post COVID-19. Talking about the structural changes in the organization. I will go very quickly through all those points since they were already implemented in the previous quarters, but we have a short review. So first of all, in 2020, the management structure hasn't changed from 2-tier corporate governance structure to 1-tier corporate governance structure. So currently, the company's activity and strategy implementation is being supervised by the Board, which consists of 5 Board members. Two of the Board members are independent, and 3 Board members are also the shareholders. The Chairman of the Board has been elected, Mr. Virginijus Lepeska, an independent member. The management of Novaturas Group remains the same and continues coping with the crisis and also implementing the long-term company's strategy. The changes in the customer service, again, during the 2020, we have made a decision to take over the core business of the subsidiary, Sofa Travel, which was the travel agency in Lithuania. So we have centralized our customer service processes. And in this way, we are aiming to strengthen our brand to control the whole channel and to make sure it operates much more efficient. And also, this also allowed us to optimize the costs as well as to maintain the high standards of the services provided. As well, throughout 2020 and continuously for the future years, we will continue strengthening the company's strategic functions and tools. We are very much focusing on certain parts of our business activity, which includes marketing, customer service, IT departments. The activities and the parts of the business that -- whose importance in the nowadays reality has increased much more. So we are looking further for the technological development elements in order to increase our processes' efficiency, as well as during this, I would say, particular time, we are -- we understand the importance of certain of marketing actions, of course of the client service, which would enable us to strengthen our market position in those unprecedented times. And we build a strong basis for the future when we start and then when we come back to normal business. Finally, we have done as well certain restructure in Novaturas' Estonian subsidiaries. So due to the optimization of the organizational structure, the company has decided to eliminate the country managers position in Estonia. So the office management has been taken by one of our long-term members of the team, of our long-term colleagues. On the other hand, the works of Estonian daughter company, of NOVATOURS OU, has not changed. So it is -- the Board members remain the same. It's me and also our financial director, Tomas Staskunas, who supervise the activity and performance of the Estonian subsidiary. And I would also like to highlight that those are the main changes that have been done in the structure and the organization. But we continuously search for further improvements of our company's organization, so that to make it leaner, to make it more digital, and it will be a continuous process throughout the 2021 and further years. Now talking about the state aid and our discussions and our agreements with the governments. Of course, tourism, as one of the most affected sectors worldwide, would have not been able to survive without support from the government. And we have seen a very, very strong support and big focus from governments in different European Union countries, so the Baltics are not an exception. So first of all, in order to ensure the company's liquidity and also to ensure the [indiscernible] continuity of our business, we have been discussing very actively possibility of the credits and loans with the states and also our main creditor bank. So I would have a short overview of different agreements that we have managed to achieve with the state and the banks. So first of all, we have received a EUR 5 million long-term loan from -- which has been received under the state investment and business bank, Invega. So this has been done in Lithuania. As well, we have received EUR 1 million long-term loan in August 2020, an additional more than EUR 1 million loan -- received term loan in January, which has been provided to us again by Invega. And this specific loan is -- has been received in order we could refund our clients who could not travel to -- and have their holidays during the pandemic and did not choose other options, like possibility to change the trip or to get the voucher, so the ones who requested the refunds. And well, thanks to this loan, we are proceeding very fast with the refunds. And very soon, we will be -- we will settle the refunds with all our clients, group-wise. Now further, with Luminor, we have agreed to delay payments of a long-term loan and extend also the overdraft. The start of the partial payment of long-term loan is postponed funds and also the overdraft limit is extended until the end of March 2021. Also, together with the insurance -- with the insurer -- insurance company and the bank, we have managed to secure guarantee and insurance limit of EUR 11 million. As well, we have been working very actively with the governments in Latvia and Estonia. So we have already received EUR 1 million loan again under the state loan guaranteed program, Altum, and we are in discussion for other possibilities. In Estonia, we are also still discussing possible options to get the state-guaranteed loan from credits. As well in all countries, in all Baltic markets, Lithuania, Latvia and Estonia, we have reached agreement to agree with the local bank authorities to defer the payment of taxes. So this has been done in all 3 markets. Now talking about the subsidies, which is another support program provided by the governments in most of the European Union markets. We are having, again, quite a different situation in each market. So first of all, in Lithuania, we have managed to get the subsidy for innovations grant, which has been applied to all tourism sectors to implement different innovational projects, so we have managed to get EUR 32,000. That was more or less the subsidy that was applied to all tourism companies, disregarding their size and absolute numbers. Then we have managed to get EUR 32,000 of repatriation compensation. This support program has been implemented by Lithuanian government. And it unfortunately does not cover all the losses that we have faced due to the repatriation of our clients in the first -- during -- in the beginning of the first lockdown. Due to the very strict regulations and conditions, the -- I would say that the repatriation compensation support program was not effective to all tourism sectors. So we are -- recently, we continue to raise those -- the discussions with the government regarding the revision of this program or for implementation of a new program so that the invested players would be compensated properly for the repatriation that decreased due to the governmental decisions in the beginning of the -- on the first lockdown. However, if you go to Latvia, we -- in Latvia, we have already received EUR 81,000 of subsidy from the Latvian government. And this subsidy was related or calculated according to the employment taxes of 2019. Again, there are also under subsidy programs that are also implemented in Latvia in order to support the most affected sectors of the COVID-19. And there is another subsidy that is being processed in Latvia for the tourism companies. It will be additional on top of what has already been paid. As well, in Latvia, we have received EUR 167,000 of repatriation compensation for the flights that have been also stopped in the beginning of the first lockdown, and those -- the flights that were operated from Latvia. So this repatriation compensation has compensated a big part of our losses for the flights in Latvia. In Estonia, we have already achieved EUR 60,000 of compensation, which is related to the employment and has been calculated according to the employment taxes of 2019. And there is also a new program that the government is being -- that the government is now implementing and working on. This subsidy program will be directed to the tourism companies and would be additional subsidy for the tourism companies, so that -- due to -- and support them in this very difficult pandemic period. And finally, the employment support, this has been also implemented in all 3 countries by the government, and we have taken all possibilities to use it. And we have already received EUR 348,000 of the partial employment compensation. In certain cases, it was for downtime. In certain cases, it was the salary subsidy. So this amount is for all 3 markets, group-wide. And again, due to the very much extended pandemic period, we are continuously discussing those issues with the government in all 3 markets. We are grateful for the governments to pay special attention to the tourism sector. And we hope that there will be very proper and very clear support measures in all markets, not discriminating the company size and also applying to the sectors that have the heaviest effect from the COVID-19 spread. Now talking about our customers. So as mentioned before, due to the very high early bookings percentage that usually we generate, we have to take very fast decisions and to agree very fast with our suppliers, with the government regarding the options that could be offered to the clients. So our customers that had -- that could not travel due to the pandemic to their booked holiday destinations, they were offered 3 options. The first option was to change their trip with the same conditions to the next year. And we are very happy that a big part of our customers have chosen this option and they remained with the company. And we are -- they remained our clients, and we are grateful to this. On the other hand, we have the wonderful opportunity to fix their price and to have also a guarantee for their booked holidays in the next year, of course, if the pandemic situation will allow. Second, we have offered to our clients the vouchers. The vouchers that also are also covered by the insurance, so they are prepayments that are covered by the tour operators guarantee. And we have issued the vouchers EUR 1.5 million group price, EUR 1.5 million total amount. And finally, the third option for the clients was to request for the refunds. Unfortunately, the refund processes have taken longer than we would have been willing to do it. We had to search for the sustainable and safe decisions so that to ensure continuity of our business and the company's activity and also to refund the clients their money. So this has taken some time because we have to, of course, to control our cash flow, and also to search for possible solutions with the government. So we have already, by this date, refunded EUR 8.3 million to our clients. And still, we have not refunded and we have requests to -- amounting to EUR 0.7 million group-wise. We are continuing, and we are in a very active processes of the refunds. The decisions -- or the solutions are already there. But technically and human-resource wise, it takes some time to process all those refunds. We are aiming to finalize our refund process till the end of February [ 2020 ]. And of course, we want to thank our customers for their patience, for their trust in the company. We hope that it will bring more trust to the -- from the client's perspective to the tourism sector and will enable them to start planning their trips for the future and also to start traveling. We would also like to thank our partners, our partner travel agents who have kept to cope with this situation for long months and as well our employees also have to face this quite, let's say, difficult and extended situation of the refunds procedure. We are happy to see that this -- the refund process of Novaturas Group will be very soon finalized. And we will have no, let's say, continuous issues or claims with the clients regarding this issue. Now talking about the future and 2021. As mentioned in the beginning of the presentation, currently, due to the virus situation and the restrictions, there is still a lot of uncertainty. On the other hand, we see the demand, and the demand for traveling is growing. The market and the people are very much tired of the restrictions, and we are looking for the possibilities to travel safely. So for the 2021 winter season, unfortunately, we have missed half of the season. And the season is starting only from February. We have started the flights to Tenerife from 5th of February, flights are planned group-wide. Also, we have -- we are offering them holiday possibility in United Arab Emirates from 12th of February. Those holiday packages are offered only in Lithuania. Also, we are starting our flights from the 13th of February to Egypt. Flights are planned from Lithuania and Estonia. Maldives are also in our product portfolio from March, and this is only in Lithuania due to the flight opportunities. So we are catching up or aiming to catch up a little bit with the winter season. As mentioned, still the flight operation is on a much, much lower level than the previous years in 2019, 2018. But the good sign is that the market is being activated. It's becoming more active, and we see a strong thirst for traveling, and we managed to sell our client seats and sell them with the healthy margins. Talking about 2021, we are maintaining our product portfolio as usual. And so we are maintaining all our destinations starting with East Bulgaria, Spain, Portugal, Italy, Tunisia, Egypt, Montenegro. Also the long-haul destinations such as Bali and Seychelles. But of course, we have to follow the epidemiological situation and to make sure that -- and this, let's say, the exact flight plan would be more clear, closer to the summer season. On the other hand, we have already revised the flight plan according to the current market reality and according to the current market situation. So if there are no barrier, increased restrictions from the countries and if all destinations accept the incoming tourists and are ready with the health and safety measures and can ensure safe service to our clients, then we would -- we are very confident of being able to operate current flight plan to summer 2021 destinations. Also, we understand that the market is changing. The client is changing, and there will be a certain market segment and certain client who will not be willing to travel far away, or try to avoid travels by flights. So we continue strengthening our product line. So we have already started with the round trips in Lithuania by west in Lithuania last year. It will continue, and we will just improve our programs and try to generate more, or increase our Lithuania market share in terms of this product. Also hotel accommodation in the Baltics, we are not only offering the main popular resorts in Lithuania, Latvia and Estonia, but we also added more big cities among our product portfolio, and we will continued strengthening this product line and offering the quality experiences to our clients in the Baltic markets, especially considering the post-pandemic reality. Whereas the traveling to more fun destinations or maybe traveling by flight would not be accepted by all market as previously, or to the same extent as previously. And as well, talking about the -- our adaptation for the new reality. Of course, we are -- we have adjusted, first of all, by ensuring safe traveling; and second, by ensuring flexible booking conditions. So first of all, talking about current tourism reality. Of course, travel safety is one of the most -- main factors when planning our business and also for the client when choosing their holidays. So I'm just really proud to see how the tourism infrastructure worldwide has managed to adopt to the pandemic reality, and how fast the -- all the suppliers within the chain, considering the airports, the airlines, the service providers and the destination, hotels and other suppliers that are in this chain of this -- of the service have adopted all needed measures. There is a very strict safety instructions and requirements at the airports, as well in the planes during the flights. Each country as well, each destination has implemented their safety and health protocols that cover all tourism infrastructure and the destinations. And especially the hotels, they are ensuring that the clients would have very safe holidays. So those measures includes a lot of different requirements, such as hotels occupancy, which is usually lower than 100%. Of course, it depends on each country, also the service in the restaurants, also the service -- the room service, the housekeeping, also the distances everywhere are maintained so that the clients could have as much as possible contactless holidays, and also, so that they could have very, let's say -- that their holidays would be at the highest level of safety as possible. As well, we have another, I would say, component or element of the new traveling reality, which is mandatory tests. And currently, the mandatory tests are obligatory, or the test -- the PCR tests are obligatory before departure to destination, and upon arrival to homeland in most of the cases, I would say. And so we most probably should be ready for this to continue for longer periods. The rapid tests would be also another, I would say, measure that would enable tourism recovery, the rapid test in the airports that would recover -- that would ensure and enable the tourism recovery much more fast. And finally, very strong, and this is a factor of the tourism recovery worldwide is the vaccination processes around the globe, not only locally in the market or in the destination, but around the globe since the tourism is so much global. So that's very important that there would be a common vaccination strategy. And this would be, I would say, the first and the main step that's helped the people to -- obviously to come back to the freedom of traveling, or at least a certain level of freedom of traveling as before. As a company, as a tour operator as well, Novaturas Group has changed their commercial conditions. And considering current uncertainty, we are providing our clients with maximum flexibility when booking their holidays. So this includes possibility to change the air trip upon [indiscernible] up to 1 or 2 weeks before the trip. Also, we have implemented a new service, which is called COVID PAUSE. And COVID PAUSE provides with the possibility for the clients to change their trip in a case they have a positive PCR test before departure to the destination. So this is the, again, the flexible conditions. One of the factors that also enabled the clients to book with more confidence their trips, their holidays, and not to be reluctant to do this due to the possibility of positive tests or any kind of changing conditions and the destinations of the market. And finally as well, we have also -- we have been working very actively with the adaptation of our product towards the new, let's say, reality. So in terms of the destinations in terms of the accommodation options, considering that also in certain destinations, the apartments are gaining more interest. Also, selecting the safe product and the hotels and the destinations that are providing the maximum safety during the -- providing the service. So this -- the product and the [indiscernible] has been also in line with all the other commercial and other actions that the company was doing. Last but not least, the -- let's see, the distribution channels control, also considering that the clients are looking for maybe more information and online booking possibilities, so this is another action that we have been doing. And finally, talking about safe traveling and especially in this pandemic and during this pandemic period, we have also [ faced ] that the clients are very much focusing on all the safety factor. And therefore, I would like to highlight once again that the tour operators are carrying of the responsibility of the client from the beginning of the trip until the end of the trip. And in a case of an unlikely event of needed repatriation, or closure of the countries, the tour operator will be obliged to bring the clients back safely to their homes. So I would say that with this pandemic, most probably the tour operators are gaining more importance among other players of the industry, as well as due to a lot of information and very dynamic change of information and regulations worldwide. The information and the correct information also now plays a very important role when choosing the trip. So the travel agents, first of all, tour operator providing with this correct and very proper information and the travel agents who are consulting the clients are also gaining more importance when choosing the trip from the clients' perspective. So finally, we would go to the review of the indicators. Majority of them -- well, we would maybe have a very quick overview. So first of all, talking about our revenue 2020, 12 months, we have had 82% decrease in the revenue. So this is more or less in line with the other -- with all industry. And of course, in each country, the tour operators have a little bit different possibilities to operate their flights due to the governmental restrictions and the different governmental decisions in each country. Unfortunately, in Lithuania, Latvia and Estonia, especially in Lithuania and Latvia, we have quite strict restrictions in 2020. The pax numbers, they have decreased by 84%. So we have managed to -- we have had in 2020, 48,500 of clients, which is of course, by far, less than the previous year. And of course, that the main reason and factor of this decrease is the COVID and all the lockdowns. Now talking about the number of travelers among each market. Here, I would like to pay a special attention to the situation that we had in each markets. So if we traditionally, we usually have around 50% of our capacity group-wise from Lithuanian markets, around 20% from Latvian markets and 30% from Estonian market. In 2020, again, due to different decisions of the government and also different market reaction, we are happy to see that Estonian markets has proven to be very active or more active than the other markets. So in 2020, the proportions among the markets as such. In Estonia, Estonia has 38% of the total pax numbers among the group. And then Lithuania has 42%, and Latvia has 20%. So Estonia had less decrease than other markets because of, again, as mentioned, more flexible governmental decisions and also different market reaction to the pandemic and, I would say, continuously stable demand for traveling. If you look into each market, so Lithuania had a decrease of 86% in terms of the pax numbers. Latvia had 84% and Estonia had 77% only comparing to the other markets. Now destinations. It's -- usually, we are reviewing our destinations portfolio and discussing why one or another destination has bigger or smaller demand. Unfortunately in 2020, it is quite difficult to review and to compare those figures. Because in 2020, in the summer, we could not operate any flights to Turkey and Bulgaria. We had only the operation to Greece, Cyprus and Tunisia in the summer season. And then the figures of 2020 for the Egypt, Spain and long haul, percentage-wise, are higher just because we still manage to operate our usual capacities during the first quarter. So of course, that percentage-wise, it shows a better result. But unfortunately, the absolute figures are not higher. And due to the fact that we could not also operate in the fourth quarter, which is already the winter season through those destinations. Finally, the distribution, while no major changes, we have almost 16.5% of our revenue for 2020 coming from the e-commerce, than the 72% from our retail agencies. So there is no major changes. And we continue on just, how to say, ensuring our very well balanced, diversified distribution control. And also in this very difficult pandemic situation, ensuring that all our channels are being -- distribution channels are being strengthened, not weakened. And the profitability indication. So we have already mentioned the EBITDA from EUR 4.3 million in 2019 has been -- has dropped to minus EUR 2.6 million in 2020. Well, again, with COVID and all the restrictions and the market situation that affected our profitability indicators. On the other hand, if you look into the efficiency and the productivity issues, we have -- we see a certain change, and I would like to comment on this. First of all, the load factor has been decreased, I would say, due to uncertainty of traveling, due to flexible conditions that we are providing to our customers in order to activate the market. So the profit -- the load factor for the 2020 has decreased a bit. Also on the other hand, the profits per pax has increased. Here, if you look into the annual profit per pax, it's quite similar to 2019. The fourth quarter profit per pax has initially 58, while last year, it was 59. But I would like to point out that this is mainly due to the fact that the flights that had been operated in 2020 fourth quarter, they have been operated during the school holidays and Christmas and New Year's period, which are usually the highest profitability periods. And therefore, we should not consider it as a general market trends with very much increased profitability. As mentioned, the company is -- will be aiming to run a healthy margin business for the future, but this profitability difference cannot be based on any kind of expectations of the future markets. The average tour price during the annual has increased slightly. So we are happy to see this, because it shows that -- it reflects, let's say, that holiday makers are catching up and are willing to pay more for their holidays, so that's a very positive indicator. On the other hand, on the fourth quarter, we had a decreased -- slightly decreased average package tour price. Again, it has a certain explanation. On the fourth quarter, we operated flights to certain destination where we had quite a lot of flight-only bookings. So this is another maybe trend of the pandemic traveling that many clients are booking flights and staying in the destinations longer than -- usually longer than 1 week, 2 weeks, or even sometimes staying for 1 month or more. So due to this, the package selling rate for the fourth quarter has been decreased. But I would say that once we are entering the normal operation and usual destinations and summer season, we should come back to similar or slightly higher selling package rates in 2021. So that's it, considering our business performance. I just would like to say from the management and from the Board perspective that we are very well prepared for 2021 and for the restart of tourism. And we understand that the new traveling reality will continue with the test, other health requirements, vaccination processes, the clients' behavior most probably will change and will be different for a certain period of time. But we are very happy to see that the demand is strong and people are willing to travel. So we are very confident in the possibility to take any chance in the market and to strengthen our position in the market. And of course, to increase our market share and to bring -- to increase the value for the shareholders of the company. So thank you very much for your attention. And then we will be pleased to answer your questions.

Thank you Ms. Audrone for the comprehensive presentation. You really had quite a year, but it's nice to see the recovery. [Operator Instructions] So let's begin. The first questions were received in advance, so it is as following: what sales turnover is planned for the year 2021? Please indicate by markets.

So as mentioned at the beginning of presentation, in this uncertain environment, currently, we are unable to provide with any forecast. We need to come to a more -- to a higher level of certainty in terms of the vaccination, in terms of the regulations of the governments and tourism policy worldwide, then we would be able to provide this forecast. On the other hand, I would -- I would say that most probably that we would continue with the planning and forecasting quarterly, again, due to dynamically changing business environment.

Another question would be from the subsidies and support measures. So if you would have anything to add to the information you already provided, please add. So the question is as following: What subsidies and loans were received from the Lithuanian government? Could you please name the amounts according to the support measures?

So this -- it has been, in details, indicated in one of the slides and during the presentation. I don't think it makes sense now to go through all this once again.

Thank you for your answer. Another question would be, how much of the commission was refund by travel agencies and organizers?

If I understand the question right, the commission is paid for the materialized trips. So if the trips were canceled and could not be materialized due to the pandemic, the whole package, including the commission of the travel agency, has been refunded to the client because the client could not travel.

Thank you for your answer. Another pre-received question is as following: the travel company, joint stock company [ Megaturas ], Novaturas partner was charging its clients. However, not all the amounts were transferred back to Novaturas. What amount was not transferred to Novaturas due to the fact that [ Megaturas ] announced bankruptcy, if this amount will be considered as a loss?

So it was already mentioned that -- and presented in the presentation and in the report that we have made a write-off of almost EUR 300,000 related to [ Megaturas ]. Also, we took all the legal actions, which we think are necessary to cope with situation and try to get back at least part of the money.

Thank you for your comment. The following question would be: Recently, Novaturas changed their Avia Partners in Lithuania to Avian Express. As we know, you had a long-term contract with jet -- Getjet Airlines, which is still valid. Why it happened?

As you may know, we have legal litigation with Getjet. It was already announced last year. We have somewhat disagreements about our obligations related to the contract in 2020, which we are discussing in the court. On the other hand, we do not have obligation to fly all our -- to operate all our flights for any carrier. So we can choose carrier, which is the best suitable in the current situation.

Thank you, Mr. Staskunas. And another question from the same investor would be: What is the maximum penalty you are risking by breaching the contract with Getjet? Is it announced in the balance sheet?

As the case is still ongoing, we are not -- we have not announced the maximum amount of possible obligation because we have a strong disagreement with the carrier. And the main disagreement is about the situation, which we had in 2020. Was it a normal year? Or was it force majeure and pandemic-influenced? Yes. So as long as we are going to dispute, we are not going to provide the number because it could be misleading.

Thank you for your answer. The following question would be: What is your debt-to-EBITDA ratio? And what are the amount of total financial obligations for financial institutions?

So we cannot calculate rate of debt-to-EBITDA for 2020 because our EBITDA was negative. So it would make no sense to calculate this ratio for 2020. The exact financial liabilities you can find in our report, which was presented, long term liability, short-term liability. And we can only start calculating risk ratio when we will come back to normal operations and start earning money.

Thank you for your answer. So we are still following up on the topic of Getjet. And the investor is asking -- thank you, Tomas, for your answer, but what is the maximum penalty possible in the case with Getjet?

As I said, I am not ready to -- the company is not ready to answer this question at the moment because this relates to contractual obligations and to the agreement between the 2 companies. And as soon as we will solve this agreement, the amount will be clear.

Thank you for your comment. As we do not have any other questions at the moment, let's wait for a minute to see if anything else comes up. Thank you. It looks like we have covered all of the questions. So on behalf of NASDAQ [ business], thank you, everyone. It was my pleasure being with you today. Recording of the presentation will be available at NASDAQ Baltic YouTube channel. Thank you, the management, for the presentation. And thank you, the attendees, for the Q&A session. Have a good day, everyone. Goodbye.