Webjet in Europe hotel room deal

Webjet’s agreement with UK-based Thomas Cook could see the online travel agency sell millions of extra hotel rooms.

Webjet's CEO John Guscic. Pic: Tim Carrafa

Webjet has struck an agreement with British-based travel behemoth Thomas Cook to acquire part of its hotel business, in a deal which could see the Melbourne-headquartered online travel agency sell an extra £1 billion worth of hotel rooms in Europe annually.

“On an annual basis this is millions of three, four, and five star rooms across 15 markets in Europe,” Webjet chief executive officer John Guscic told The Australian.

The five-year deal, plus options, gives Webjet’s European online accommodation wholesale business Sunhotels access to 3000 hotels and will cost the company £1 billion.

“Three thousand hotel contracts from Thomas Cook will be novated to Webjet,” Mr Guscic said.

He said the agreement “allows Webjet to escalate its growth profile in the dynamic European B2B market”.

The deal comes as Webjet (WEB) announced its net profit after tax rose 27 per cent for the full year to June 30 to $22.2 million, thanks to strong growth in domestic and overseas holiday bookings.

Mr Guscic says terrorism targeting tourists, including recent attacks in Turkey, have not hurt Australians’ appetite for overseas holidays.

“When it (terrorism) occurs, we see massive cancellations to that destination,” Mr Guscic told an analyst briefing.

“What we also see on the same day is a massive uplift in bookings somewhere else.

“So it is consumers changing their (destination) preferences for travel.”

He said one of the group’s hotel business, Sunhotels, had a 43 per cent jump in bookings in the second half of the 2016 financial year with the top growth destinations being the United Arab Emirates, Italy, Spain, USA and Thailand. Travellers were also becoming more comfortable with booking international flights online, he added.

Mr Guscic said all businesses in the group’s digital retail and digital wholesale divisions achieved strong bookings growth and increased market share during 2015/16.

With AAP