Helloworld reports pent-up demand for travel, big hit to revenues

Helloworld expects east coast tourism to reopen by December, but long-haul international travel may not be back until 2022.

Helloworld is hoping Pacific island bubbles may open up with Australia and New Zealand in the first half of 2021. Picture: Alex Coppel.

East coast domestic travel will reopen by early December, followed by the broader trans-Tasman market a few weeks later, travel agency Helloworld has foreshadowed in a market update.

“Further Pacific island bubbles may open up with Australia and New Zealand in the first half of 2021,” said Helloworld, adding that there was extraordinary pent-up demand for leisure travel, particularly cruising.

While Western Australia has committed to keeping its borders shut until next April, Japan, Singapore, South Korea and China are expected to establish travel bubbles, with direct non-stop air services opening up.

But Helloworld does not expect long-haul international outbound travel to resume to the United Kingdom and Europe or the United States until late next year or possibly early 2022.

“A full return to pre-COVID-19 levels is conditional upon a vaccine or cure for COVID-10 having been developed, approved and widely distributed.”

Helloworld, which operates primarily in Australia, New Zealand and the Pacific, said it has enough liquidity to maintain operations well into 2022 or longer based on its cash burn rate.

Helloworld’s total transaction values for the September quarter were $176.8m, down 90.6 per cent on the same period last year. Revenues were down nearly 87 per cent on the prior year, although operating expenses have reduced nearly 77 per cent.

Helloworld’s corporate travel business, including QBT and show travel, are operating at around 40 per cent of total transaction values compared to last year.

On the retail front, Helloworld said its bricks and mortar agencies are down 80 per cent for the May to August period primarily due to the large amount of cruise cancellations and the limited amount of cruise product for future bookings.

Shares in Helloworld closed down 4.4 per cent on Thursday, at $1.72 each.