eDreams expects to return to profit before 2025 with the boost of subscriptions

The online travel company eDreams expects to return to profit before 2025 thanks to the strong tourist demand and the growth of its Prime subscription service, with 4.

Oliver Thansan
Oliver Thansan
25 May 2023 Thursday 10:25
18 Reads
eDreams expects to return to profit before 2025 with the boost of subscriptions

The online travel company eDreams expects to return to profit before 2025 thanks to the strong tourist demand and the growth of its Prime subscription service, with 4.3 million members (60% more than in the previous year) who already They contribute half of the income. "The subscription service is very well received and by 2025 we aspire to reach 7.25 million members in the Prime program," said David Elizaga, financial director of the company founded in Barcelona, ​​during a meeting this Thursday with the director eDreams CEO, Dana Dunne.

After the shock of the pandemic, which paralyzed the tourism industry for months, travel is back with a bang despite inflation. In this context, eDreams has achieved record sales of 621 million euros in the last year, closed in March 2023. However, it continues to make losses. The red numbers reached 43.3 million euros, 34% less than in the previous year. In two years, given the evolution of the business and the growth plan, the company should earn money again, Elizaga has insisted. The last year in which it obtained benefits was the one that ended in 2019, with 9.52 million euros in positive and 551 million in billing.

During this time, and despite the Covid, eDreams has continued to increase its workforce and invest in artificial intelligence technology, which explains, according to Elizaga, why they are still in losses. If in 2021 the company had a workforce of about a thousand people, today it has 1,400 workers and in two years it expects to reach 1,550 employees. "We are recruiting engineers and product personnel," Elizaga commented. The average salary of an eDreams worker in 2022 was 61,000 euros, according to the documentation that the company has sent to the CNMV today. The CEO, Dana Dunne, received a total remuneration of 3.51 million euros that year, 37.5% less than in 2021, when it reached 5.62 million euros.

The company plans to invest between 45 and 50 million euros in the fiscal year of 2024, mainly in technology. In addition to Barcelona, ​​it has technology centers in Madrid, Porto, Palma and Alicante.

As for the demand to travel, it continues to rise despite the high prices of flights and, above all, hotels, Elizaga has assured. "People continue to travel, but they adapt their budget. They choose closer destinations and shorten their vacations somewhat," she says. If the average reservation in 2019 was 450 euros, now it is 380 euros. Despite the rise in prices, he affirms that air ticket fares continue to be 8% below 2019, but not hotels, which are more expensive than before the covid.

They do not foresee major changes in the company's shareholding, after the Paris-based venture capital fund Ardian sold its 15.6% stake last December. Polus Capital Management (formerly Mediobanca) and Conversant Capital acquired the shares of Ardian. The new shareholders have not asked to enter the board of directors.