DGAP-News: HolidayCheck Group AG publishes the figures for the third-quarter and the first nine months of 2021 - excellent business development in the third quarter of 2021

CORPORATE NEWS

HolidayCheck Group AG publishes the figures for the third-quarter and the first nine months of 2021 - excellent business development in the third quarter of 2021

Munich, Germany, 8 November 2021 - HolidayCheck Group AG benefitted from a marked recovery of the market in the second quarter and in particular in the third quarter of 2021. Thus the trend over the first nine months of the year was particularly pleasing. Despite a significant reduction in marketing intensity, package holidays, hotel bookings and hire cars via our key brands - HolidayCheck, HolidayCheck Reisen, MietwagenCheck and DriveBoo - were in high demand, especially as from June 2021.

As a result, HolidayCheck Group managed to turn around all its earnings figures in the third quarter of 2021 and even in the first nine months of 2021. On the earnings side, the company also recorded the most successful quarter in terms of its operating result since changing its name to HolidayCheck Group in 2016, with EBITDA of EUR 15.0 million. This was partly owing to the change in the revenue recognition policy at the end of the previous financial year, following which, as a precautionary measure, revenue is only recognised once a holiday has begun. Due to the seasonal nature of the business, most departures take place in the summer months.

In the first nine months of 2021 HolidayCheck Group AG posted noticeable growth in revenue. The figure came in at EUR 46.0 million compared with EUR 11.2 million over the same period of the previous year.

At EUR 37.1 million, revenue for the third quarter of 2021 was significantly up from EUR 13.0 million in the same period of 2020.

The total value of bookings for holidays with departure times in the fourth quarter of 2021 stands at around EUR 85 million, and total value of bookings with departure time in 2022 at around EUR 40 million. Once these holidays actually begin, the booking commission can be recognised as revenue.

The order book for booked tours with a departure date within the fourth quarter of 2021 amounts to around € 85 million and that for tours in 2022 to around € 40 million, on which commission claims arise upon departure and are recognised as revenue.

As a precautionary measure, this revenue has not been included in the revenue figures for the first nine months of 2021. Based on past experience, holiday cancellations might reduce our commission revenue by a significant margin. In the first nine months of 2020, the anticipated commission revenue for holidays due to commence after each reporting period was recognised in the accounts on the basis of careful estimates.

Cost of goods sold (COGS) for the first nine months went up from minus EUR 5.1 million in 2020 to minus EUR 12.7 million in 2021 (advance purchases of holiday services, expenses for hotels, flights and transfer services by the Group's in-house tour operator HC Touristik).

In the third quarter of 2021, cost of goods sold rose to minus EUR 11.5 million from minus EUR 3.5 million in the same period of 2020.

Gross margin for the first nine months of 2021 increased to EUR 33.3 million compared with EUR 6.0 million in the equivalent period of the prior year. Gross margin is defined as sales revenue less cost of goods sold (COGS).

Third-quarter gross margin was EUR 25.6 million in 2021 and thus significantly higher than the figure recorded in the previous year (EUR 9.5 million).

In 2020, the company implemented a series of comprehensive cost-saving measures in every area. This helped HolidayCheck Group AG to achieve a sustained year-on-year improvement in both quarterly and nine-month earnings.

Marketing expenses in the first nine months of 2021 fell to minus EUR 1.7 million compared with minus EUR 8.8 million in the first nine months of 2020.

The main factors here were lower voucher costs and the deliberate decision to suspend almost all marketing activities as of mid-March 2020.

In the third quarter of 2021, marketing expenses were slightly higher year on year and stood at minus EUR 1.1 million (minus EUR 0.7 million in 2020).

Personnel expenses for the first nine months of 2021 fell to minus EUR 15.9 million compared with minus EUR 22.5 million recorded for the same period of 2020.

The main factor here was the workforce reduction in the third quarter of 2020 in response to the Covid-19 pandemic.

At minus EUR 5.2 million, personnel expenses for the third quarter of 2021 were down from minus EUR 6.5 million in the same period of the prior year.

The previous year's item included expenses for the above-mentioned staff reduction measures. The amount was partly offset by the reversal of pension obligations for employees who left the company and reversals in connection with the Long Term Incentive Program (LTIP). The figure shown for 2020 comprised government subsidies under short-time working arrangements.

At minus EUR 9.2 million, other expenses in the first nine months of 2021 were lower than in the same period of the previous year (minus EUR 12.7 million).

This reduction was mainly achieved through Group-wide cost saving measures and lower service centre operating costs.

Other third-quarter expenses were slightly up from minus EUR 3.7 million in 2020 to minus EUR 3.9 million in 2021 due to a significant increase in travel and resulting higher Service Centre costs.

There was a marked improvement in EBITDA (earnings before interest, taxes, depreciation and amortisation) in the first nine months of 2021. EBITDA went up from minus EUR 33.0 million in the prior-year period to EUR 7.2 million.

Third-quarter EBITDA also improved noticeably and came to EUR 15.0 million in 2021 compared with minus EUR 0.7 millionen in 2020.

Operating EBITDA (operating earnings before interest, taxes, depreciation and amortisation) improved from minus EUR 31.0 million in the first nine months of 2020 to EUR 6.9 million in the first nine months of 2021.

In the third quarter, operating EBITDA was EUR 15.1 million in 2021, up from EUR 0.8 million in 2020.

Nine-month EBIT (earnings before interest and taxes) showed a year-on-year improvement from minus EUR 38.8 million in 2020 to EUR 2.8 million.

EBIT improved from minus EUR 2.6 million in the third quarter of 2020 to EUR 13.7 million in the same period of 2021.

EBT (earnings before taxes) in the first nine months of 2021 was EUR 2.5 million, an improvement on the figure of minus EUR 39.0 million for the same period in 2020.

Third-quarter EBT was EUR 13.6 million in 2021 compared with minus EUR 2.7 million in 2020.

Consolidated net profit/(loss) from continuing operations in the first nine months of 2021 was EUR 1.7 million, up from minus EUR 34.7 million in the same period of 2020.

Consolidated net profit/(loss) from continuing operations recorded for the third quarter of 2021 was EUR 11.9 million compared with EUR 1.3 million shown for the third quarter of 2020.

Diluted and basic earnings per share from continuing operations improved from minus EUR 0.60 in the first nine months of 2020 to EUR 0.02 in the same period of 2021.

Diluted and basic earnings per share from continuing operations were EUR 0.14 in the third quarter of 2021 and EUR 0.02 in third quarter of 2020.

As at 30 September 2021, cash and cash equivalents stood at EUR 72.7 million compared with EUR 33.7 million as at 31 December 2020. The improved liquidity position was mainly due to a cash inflow of EUR 46.7 million from the capital rights issue carried out in the first quarter of the current year.

Positive and negative scenarios for the financial year 2021

Given continued uncertainty over the likely development of the Covid-19 pandemic, in March 2021 the Management Board decided not to offer a quantitative forecast for gross margin and operating EBITDA.

Instead, based on our forward plans, we have drawn up two scenarios - one negative and one positive - for the financial year 2021. These stand at each end of the range within which our actual results will probably lie on the basis of the information available. Each makes different assumptions about the impact of Covid-19 in terms of duration and intensity. Both have been continuously updated. For each of these scenarios, the Management Board has prepared qualitatively comparative assessments of the likely impact on gross margin and operating EBITDA.

The following Management Board assessment for the financial year 2021 reflects both the underlying assumptions set out above and, based on our current knowledge, the two scenarios at each end of the range for the potential impact of Covid-19.

In the positive scenario, the Management Board expects the HolidayCheck Group's gross margin (sales revenue less cost of goods sold) to at least double compared with the figure for 2020. Even so, it is likely that gross margin will remain significantly below the pre-crisis level of 2019.

In the negative scenario, the Management Board expects the HolidayCheck Group's gross margin for financial 2021 to be roughly on a par with the figure for 2020. In financial 2020, the HolidayCheck Group achieved a gross margin of EUR 7.3 thousand and in financial 2019 of EUR 131.2 thousand)

With regard to operating EBITDA, the Management Board anticipates a year-on-year improvement whichever of the scenarios proves to be more accurate. The figure for operating EBITDA in financial 2020 was minus EUR 35.9 million.

The latest estimates indicate that the gross margin and operating result for the year as a whole will be positive, mainly due to the positive operating performance in the third quarter of 2021.

Given the current uncertainty, we are unable to provide reliable forecasts of increases in gross margin and operating EBITDA.

Outlook

The positive trend in bookings in the second and particularly the third quarter of 2021 shows compellingly that the appetite for travel among Germans, Austrians and Swiss has not diminished. However, to a certain extent factors such as complicated travel regulations and inconsistencies in how they are observed, as well as concern over the possibility of a fourth wave of the pandemic, continue to have a dampening impact on the demand for holiday travel. These factors could also have a negative impact on future cancellation rates for holidays already booked.

However, in the opinion of the Management Board, it is possible for the medium to long-term growth potential of central European holiday sales, most notably online holiday sales, to reach pre-Covid levels again.

With its lean cost structure and the high profile of the HolidayCheck brand, coupled with the solid cash situation, the Management Board believes the company is ideally placed to profit from this growth potential.

Note:

The German version of the interim statement for the first nine months of 2021 will be published during the course of the day on the company's website at www.holidaycheckgroup.com under the heading 'Investor Relations'.

In compliance with the provisions of Section 27 paragraph 1 of the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz, WpÜG), a joint reasoned statement of the Management Board and Supervisory Board regarding the voluntary public delisting tender offer (cash offer) of Burda Digital SE to the shareholders of HolidayCheck Group AG will be published no later than 12 November 2021 on the website of the company (section: 'delisting'): www.holidaycheckgroup.com/investor-relations/delisting/

About HolidayCheck Group AG:

HolidayCheck Group AG (ISIN DE005495329), Munich, Germany, is one of Europe's leading digital firms for recreational holiday. With a total workforce of around 250, HolidayCheck Group AG comprises HolidayCheck AG (which operates hotel review and travel booking portals by the same name), HC Touristik GmbH (which operates the tour operator HolidayCheck Reisen), and Driveboo AG (which operates the car rental portals MietwagenCheck and Driveboo). HolidayCheck Group's vision is to become the world's most holidaymaker-friendly company in the world.

Media and Investor Relations contact:

HolidayCheck Group AG

Neumarkter Strasse 61

81673 München

Germany

Armin Blohmann

phone: +49 (0)89 357 680 901

fax: +49 (0)89 357 680 999

email: [email protected]

Sabine Wodarz

phone: +49 (0)89 357 680 915

fax: +49 (0)89 357 680 999

email: [email protected]

www.holidaycheckgroup.com