# WEB, HWT



## TjamesX (5 September 2005)

I have been looking around for an internet based company that could be the leader in its service field - and so reap the rewards.

WEB (webjet.com.au) came to my attention on Friday and after doing some quick research I was very pleased by their latest results.... I don't know if anyone has used them - but their competition seem to be;

- travel.com.au (TVL)
- zuji.com.au

Has anyone used any of these - what was their experience??

Well anyway, back to the saga.... Webjet's largest shareholder is Harvey World Travel (HWT) with 19%. On a quick look at HWT’s business they seem generate most of their income through franchising their agencies. The number of company owned agencies has been decreasing as they have moved to franchising.

Webjet is currently making a profit and has spare cash, further to this HWT has an option to increase its holding to 34% of issued shares at a discount to current price (without triggering a takeover – don’t ask me how this works). If HWT were to exercise this option at the current price, we are talking many million more going into webjets business, cashed up and ready to expand!!. Webjet would then be a very significant part of HWT existence (already is) and would effectively be the companies bet on the future of the travel agency business.

HWT announced on Friday it was looking into its holding and option in webjet (read – it is looking to exercise) both WEB and HWT’s prices rocketed up late last week. Whether HWT would actually proceed with a full takeover is ?? as webjet would not be attractive to anyone else with HWT’s holding and options.

Now to throw something else into the mix, SEL an ASX listed company that says its involved in property management and services has today announced a takeover bid for HWT at $1.85!!! (14% above Friday’s close) ….

Well I think that about wraps it up.

1) I wouldn’t want to touch a HWT franchise agency    
2) How will flight centre react?


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## tech/a (5 September 2005)

*Snap!!*

Mentioned it here on Friday.Post 14.

As you can see I like them.
Havent used them though---price is rising so Thats how I found them. 

https://www.aussiestockforums.com/forums/showthread.php?t=1214&page=1&pp=20


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## britishcarfreak (6 September 2005)

After a major run to 40c yesterday the question is whether the layers of takeovers and options exercising (HWT and SEL) will drive this any further.  I hold a small amount and was anticipating further runs but am now starting to worry.  I'd be keen to see if anyone else has any ideas about potential to keep moving or whether this run was it....


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## TjamesX (7 September 2005)

Short to medium term there is a lot of uncertainty

SEL has a takeover bid on HWT, but in its statements appears to be more interested in HWT's existing agencies and synergy benefits with its property holdings - it doesn't mention webjet. Webjet is in a rapid growth phase that I think would be much better served with HWT's ownership than SEL.

If webjet reached critical mass I think it could be big, it could do this with the capital injection via HWT options. But if it was going to make it big, then you would think HWT would control the process or just take it over. Chances of a bidding war for it are small.

A small comparison of HWT and WEB businesses;

 - HWT profit of $2mill on revenues of $58mill
 - WEB profit of $1.5mill on revenues of $5mill   

WEB's business is essentially a website, its high margin stuff - good business model. HWT's business is much lower margin - much more risky.

I don't hold any of the mentioned shares, I'll sit and watch for the time being - lots of uncertianty


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## TjamesX (30 September 2005)

had my eye off the ball last few weeks,

HWT is currently at $2.05
WEB rose 11% today to 48.5c

Did you get any of these Tech?


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## tech/a (30 September 2005)

Been on Web since first mentioned.
Obviously now I lament not having the house on it!!
But Hey.


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## TjamesX (5 October 2005)

Took the opportunity to get into WEB today at 39.5c after the big falls of the last two days, I am hoping this will be a long term holder.

I'll post some simple calcs I've done tonight.

Noticed on the TV last night Flight Center advertising its website heavily for the first time!! This for a company that has customer service offices on every corner - maybe the penny has finally dropped. All I hope is that HWT and/or SEL don't stuff this business up.


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## GreatPig (5 October 2005)

TjamesX said:
			
		

> Took the opportunity to get into WEB today at 39.5c



Well I took some profit today at 41.5 cents.

Which means you're onto a sure thing: it will certainly shoot back up now 

GP


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## tarnor (5 October 2005)

I sold this somewhere under 5c not too long ago, please make it stop.


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## TjamesX (6 October 2005)

Ok Here are my basic calcs;

Valuation in 5 seconds.....

2005 figures

Trans Values: 77.5 mill 
Revenue: 5.3 mill
% conversion of Trans Values to revenue: 6.84%
Expense (before tax): 4 mill
Tax: 0 mill (use of tax losses)
PAT: 1.4 mill
Shares on issue (inc options): 224 mill
*EPS (diluted) 0.625c* 
*Current PE @ 40c = 64 times *  

2006 estimates

Using Trans values of 10.9 mill for July, 14.1 mill for Aug, 14.5 mill for Sep and then 14.5 mill per month for the rest of the year (no increase), total Trans value is 170 mill (and that this converts to revenue at 6.84%). I will assume expenses increase 40% and it uses tax loss benefits of 1.8 mill and no shares are issued during the year

Trans Values: 170 mill 
Revenue: 11.6 mill
% conversion of Trans Values to revenue: 6.84%
Expense (before tax): 5.6 mill
Tax: 0 mill (use of tax losses)
PAT: 6 mill
Shares on issue (inc options): 224 mill
*EPS (diluted) 2.68c* 
*Forecast PE @ 40c = 14.9 times *   Thats better   

Which compares nicely with overall market PE of around 15-16 especially for an internet company

any thoughts?


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## TjamesX (6 October 2005)

Just some other comparisons

REA (realestate.com.au) currently trades at a PE multiple of 36 times, for WEB to trade at a multiple of 20 times (on my forecast 2006 earnings) the SP would need to move to 53.6c, and at a multiple of 25 times SP would be 67c

I'll just hope my 5 sec estimates are close


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## tech/a (6 October 2005)

Sold WEB at 44 on Tuesday.

Looking at buying in again as the dust settles.


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## el_ninj0 (6 October 2005)

tech/a said:
			
		

> Sold WEB at 44 on Tuesday.
> 
> Looking at buying in again as the dust settles.




How did you get the hint to sell out on Tuesday tech/a?
thats a very lucky move if you didn't know what was going to happen yesterday.


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## tech/a (6 October 2005)

Just a couple of Bombs went off in Bali.

I was watching this tick chart and as youll see it retraced from 42c I just logged a sell at market and jagged 44c So WEB was looking sick--no genius on my part I'm afraid.
This is why I think its an over reaction plus its being pulled along with the correction---I think,want,hope,wish,pray,and want to believe.


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## TjamesX (7 October 2005)

Well I doubled my holdings in WEB yesterday, was so close to getting order filled at 36.5 but in the end had to settle for 38  

I happy with 38, the same price that Pratt increased his holdings at not too long ago

Now i'll just sit and wait to see if their monthly transaction volumes keep rising   

TJ


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## Richard Willoughby (15 October 2005)

I've just joined this website and pleased to see a thread on webjet (unlike most other sites). I am a long term holder of web. (very biassed) I think the current run is more about reaching profitability and increasing trans values than due to HWT/SEL etc. Webjet has taken approx 5 years to reach this point, this was delayed by commissions falling from 5% to 1%. They gambled all to pay microsoft to design/build website with plenty of redundancy in it, nearly went broke which is where HWT where let in cheaply to provide money/time for model to work. I don't think costs will increase by 40% as business model is very good. Last year trans value approx 20mil for (memory) 14 employees this year trans values 77mil for 19.5 employees. Although a resolution for this years agm is for pay increases for directors, they are not paid much now.I think they are planning to expand to include other international markets and if they can achieve any type of success os(usa) than the skys the limit. Interesting that Norm Fricker (HWT Chairman and director of webjet) has quit the webjet board not sure what to make of that..
Anyway its good to see webjet discussed here.
Regards tricky


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## TjamesX (16 October 2005)

Richard Willoughby said:
			
		

> I think the current run is more about reaching profitability and increasing trans values than due to HWT/SEL etc.




Agree, SEL have now aquired HWT. I now believe that SEL does not know what it is doing with regards to WEB and the fact WEB could actually be bigger than HWT and SEL.



> They gambled all to pay microsoft to design/build website with plenty of redundancy in it, nearly went broke which is where HWT where let in cheaply to provide money/time for model to work.




In my google research about WEB I stumbled across a case study advertising microsofts expertise in building .NET infrastructure websites that detailed the Webjet project - about how stable the site is and how easily it can be scaled up 



> I don't think costs will increase by 40% as business model is very good.




I was trying to be a little conservative in my analysis   



> I think they are planning to expand to include other international markets and if they can achieve any type of success os(usa) than the skys the limit.




Personally I would prefer if they cemented their position in Aus first. i would like to see a bit more advertising - I don't know how they've grow so quickly so far without it? Flight centre are advertising their website pretty aggressivly at the moment....



> Interesting that Norm Fricker (HWT Chairman and director of webjet) has quit the webjet board not sure what to make of that..




Norm has left as a result of HWT being taken over by SEL, the other HWT guy has decided to stay on for the time being. I would have prefered a webjet with HWT as majority holder - oh well.



> Anyway its good to see webjet discussed here.




Lets hope the discussion continues...

this week should be interesting - it rebounded heavily last week only to trade back down to 42c. I am a strong believer in their business if they can keep the growth going....


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## el_ninj0 (16 October 2005)

What do you all think a good entry price for WEB is? 
Ive come to believe that its an excellent investment, but at what price I'm not quite decided on yet. Consolidation is probably in order I think before it starts its rise again, but im not quite sure.


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## Richard Willoughby (17 October 2005)

price entry? i think (hope) it will hold above .40 until this months trans is available, mainly to see what effect the latest bombs have. i don't think they will hurt much but who knows..web was going along fine until the trade centres then bali happened and it stalled(trans values) the next two months figures if good i think will raise the sp significantly.
   tjames conservative is good i was just adding to discussion, cementing in ossie, yes definitely. with ref to os(usa) when web ist started they had no manual assistance operators it was solely do it yourself, in fact that initially was a major part of their business model, they changed that and rightly so i believe but maybe if they had an agreement with a usa type hwt they would revert temporarily(with os cust) to that type of arrangement which i think the existing website could be easily(low cost) adapted to it. 
 David Clarke seems to have the ability to form partnership/agreements with other parties and each time trans values seem to keep rising.(so far)
    tarnor i know exactly how u feel(i didthat 2)
   cu tricky


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## el_ninj0 (30 October 2005)

Looks to be coming back down for a couple of months before it comes back up.
Seems to have broken the support it was on. Very hard to tell how far it will fall by the chart.

Any one else got some thoughts they'd like to share?


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## Richard Willoughby (1 November 2005)

the trans figures should be released in next couple of days, depending on them direction of sp. if they hold last months figures i intend to buy more
if price doesnt go dramatically in either direction. i think figures will be good
but .......?  it would be very good to know the visit numbers to webjet site, i wish  they had a counter on the site.


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## Richard Willoughby (2 November 2005)

trans figures released today 13million, down a bit on last 2 record months(14.1,14.5) still a good figure but i think sp will probably come back a bit. i sold some today and will wait for the next couple of weeks and see what happens.


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## el_ninj0 (8 November 2005)

Steep downtrend going on at the moment. Could be a good time to pickup some cheap shares. Might wait a bit longer though and see how far it will fall.
I have no idea how far it will go, but i beleive the comment has been made before...: confucious say try to pick bottom and get smelly finger.
So bottom picking is out.

Whats everyone elses thoughts?


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## Richard Willoughby (9 November 2005)

i agree, i'm going to wait a bit longer think it may find a lot of support around .29/.30 mark but who knows..... fair volume tues but i'm just going to watch(i think) for a few more days...def agree with no bottom picking its hard to say where the bottom is a lot of money made so profit could still be taken at .30 level...i think it will consolidate around .30 but..? the last trans figs taking into account bombs etc were not too bad maybe this drop is more to do with going to hard to quick ..
cu


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## Kauri (9 November 2005)

May be a good level to see if it forms some sort of reversal..


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## Richard Willoughby (9 November 2005)

i agree, bottom picking out who knows the bottom a lot of profits still could be taken, i feel probably consolidate around.29/.30 seems to be support there but am guessing. i'm going to wait(i think) for a few more days and see what happens, no reports due from co until next trans figs about 3/12/05 so perhaps sp will stabilise and not do anything extreme. last trans figure not that bad so perhaps this down is more to do with too much too quick..maybe  i sold all .39/.38 so am happy at the moment.
cu

edit : sorry didnt think my last post made it so did it again


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## Kauri (15 November 2005)

Got set at .355c today... looking for .505 in near future.    
   I hope :santa: is good to me this year.


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## Richard Willoughby (15 November 2005)

the reversal was well tipped kauri, i still have'nt got back in yet which means it will prob go like crazy.... anyway i am keeping a close eye on it.. i just think it may come back some more on the basis of no news for a while, but am prob wrong. i'm confident that sometime in the future web will do something real good. i've been more fundamentals but am rapidly starting to change my attitude to tech.


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## TjamesX (5 December 2005)

The travel agency business sure does change quickly,

I decided to get out a few weeks ago for an overall 5% loss after flight centre started advertising their web portal heavily and the trans volumes had stalled.....

Now today Qantas has revealed;



> Under the new structure, Australian domestic, trans-Tasman and New Zealand domestic base commissions, currently 1%, would be discontinued.




   

That does change the fundamental picture just a tad.

WEB down 10%
FLT down 12%

WEB may fall below 30c tomorrow, and considering these guys would live off flight ticket commissions I'm not really willing to jump back in any time soon....


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## el_ninj0 (6 December 2005)

T/A:

Its had its dip, and gettin ready to jump again i think. I was thinking this might come down a bit more, but looking at the chart again, its had its fall for now(speculation).

Wish i'd picked this one for the tipping comp.


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## serp (7 December 2005)

I reckon both web and flt still have a bit more fall in them.


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## Richard Willoughby (7 December 2005)

news from quantas cant be good, but not sure how bad. david clarke is welcoming news based on volume service fees still being paid and as web is top internet seller perhaps they will gain trans figs at the expense of others?
when fees reduced from 5% to1% it knocked web for awhile until trans figs built up.. maybe it will knock some others out.. last months trans figs were slight improvement on previous month. i went in at .35 took the loss out .31 i think i'll stay out for awhile and watch. web announced they will not be putting out their monthly trans figs, wish they would keep doing that..
 cu tricky


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## Richard Willoughby (15 December 2005)

went back in at .36. web do in fact charge a transaction fee to its customers so i guess on an $80 trans 1% is only .80 cents they will prob just increase trans fees slightly to make up the diff. well el_ninjo another victory for t/a what was the main indicator to you, the double test of bottom?. seems to be on a roll now. 
cu tricky


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## tech/a (15 December 2005)

If interested


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## GreatPig (15 December 2005)

Here's my interpretation of Web.

Not sure if that's a valid cup fit, but it seems reasonable to me. And I might be stretching my imagination a little here , but could that perhaps be interpreted as a diamond reversal pattern in the middle of the cup?

Anyway, I bought in today at 38.5 cents. My system gave a buy signal four days ago, meaning I should have bought on the last red candle day, but I wanted to see if it would break above the left-hand side of the cup (15/11) first, which it did today (actually it just did yesterday).

If that is a valid cup, I estimate the target should be about 43 or 44 cents. Looks like there could be some resistance at 40 cents though - perhaps to create a handle?

Cheers,
GP


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## Richard Willoughby (19 December 2005)

Great Pig & Tech/a i am very interested in your responses have slowly come to believe in ta. the form known/unknown is i believe in the price(same as the dogs) web on a roll now the 6 monthly figs should be very good trans values of $80 mil. tech/a i went off to look at eliot waves and got sidetracked with stoch slow stc 20%k 9 d pattern now is very similiar to 1/6/05 which was start of very good 4 months. not sure how good an indicator stc is but it does seem to add to the + side. will look at eliot soon until now i was'nt aware of them have just started(2 mths) to seriously look at t/a.
cu tricky


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## tech/a (19 December 2005)

Richard.
Its all smoke and mirrors!

After 11 yrs of technical analysis investigation my conclusion is that all forms of analysis both fundamental and technical give us a basic starting point.

Their ability to be predictive is a misnomer and their capacity to exit again no more than a basic finishing point.

All important none the less---

Correct use of analysis being an important key to its deployment and success.
Often analysis molded to suit an arguement will result in less than spectacular,and more dissappointing outcomes.

A simple hint is that if you have to look for an analytic confirmation and it doesnt stand out like a shark in a swimming pool--then its not there!

The final secret is to combine and implement any analysis into a profitable trading methodology which is *CONSISTANT*.
Analysis then becomes a tool in that methodologies construction.


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## GreatPig (19 December 2005)

Wow, it's already at my 43-44 cent cup target.

Have to keep a close eye on what happens now.

Cheers,
GP


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## tech/a (19 December 2005)

Wave 5's are around the same length as wave 3's
Making a target of around 71c.

This leg is likely to be made up of 5 waves within this final wave.


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## GreatPig (19 December 2005)

tech/a said:
			
		

> Wave 5's are around the same length as wave 3's
> Making a target of around 71c.



If it is a wave 5.

While that count does look a bit neater, I can also potentially see it one step further advanced by starting one wave back.

But hey... I'm all for it being a wave 5 as well 

Cheers,
GP


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## Kauri (19 December 2005)

Whilst I follow patterns I don't pay too much attention to targets derived from them, however she *may *pause here as pattern target traders get off.


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## tech/a (19 December 2005)

Dont you love the subjectivity of Technical Analysis.


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## Kauri (19 December 2005)

tech/a said:
			
		

> Dont you love the subjectivity of Technical Analysis.




     Yep, I have often found that knowing possibly where sell points are and giving your stops a bit of leeway in this area quite often leaves you exposed to a longer trend. I have found that a lot of patterns can be viewed as medium term trend reversal/continuation signals as well as the shorter term target trades.


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## Richard Willoughby (20 December 2005)

tech/a
thanks for your words of wisdom, i have taken them on board and think many others should do the same. i admit to doing some research on you actually t2win led to reef you surely seem to have done the work..
cu Richard


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## GreatPig (23 December 2005)

Up until Nick Radge mentioned Fibonacci a little in his book, I'd never played with any of the Fib tools in AmiBroker. Recently though I've been trying the Fib retracement tool, and it's quite interesting (I think) how may retracements in different stocks do come down very close to one of those central levels before turning back up.

Web is a good example (although of course I'm not sure yet whether in fact it has finished going down for now). Before bouncing back up a little today, it bottomed out almost exactly on the 38.2% Fib line.

Now I'll have to read up on how the Fib fan and other tools works.

Cheers,
GP


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## Richard Willoughby (24 February 2006)

great 6 monthly report, net profit up nearly 1400%. md reports a record month in jan 06, and a record week in feb 06. trans values continue to rise sp surely will rise? who knows unfortunately i have need of funds soon so will have to sell in the near future.. this co. has been great for me.


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## Richard Willoughby (25 March 2006)

webjet and the market amaze me at times. great 6 mthly report sp down?
maybe people think airlines commissions are going to have a major effect, web in fact charge their own commission, maybe david clarke selling some shares after report, his done this before?  not a great confidence booster.
any ideas anyone?  i still hold.
regards tricky


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## el_ninj0 (26 March 2006)

Richard Willoughby said:
			
		

> webjet and the market amaze me at times. great 6 mthly report sp down?
> maybe people think airlines commissions are going to have a major effect, web in fact charge their own commission, maybe david clarke selling some shares after report, his done this before?  not a great confidence booster.
> any ideas anyone?  i still hold.
> regards tricky




From t/a i would say this is going to go down slightly below the 30cps mark, but definetly not by much, mabey 1 or 2 cents at most. There is a downward trend with a leveling out at 30cps in the chart. I dont hold, but im considering getting in at 29cps.

Good company that still has alot of potential in my opinion.


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## Richard Willoughby (27 March 2006)

i agree they (webjet) have said they won't be releasing monthly trans values so probably no announcements until mid april(i think they are releasing 3 mthly investor guidance or something like that) so it will prob not move up and could come back a bit. sadly i am going to have to sell in next couple of weeks as i need money for a property i'm buying, on the positive side this has been a great co. for me. they have cash in bank, no debt and record sales and net profit. its going to hurt to sell them.
cu tricky


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## burmans (5 July 2006)

Richard Willoughby said:
			
		

> i agree they (webjet) have said they won't be releasing monthly trans values so probably no announcements until mid april(i think they are releasing 3 mthly investor guidance or something like that) so it will prob not move up and could come back a bit. sadly i am going to have to sell in next couple of weeks as i need money for a property i'm buying, on the positive side this has been a great co. for me. they have cash in bank, no debt and record sales and net profit. its going to hurt to sell them.
> cu tricky




Not sure you've missed anything, while there has been some great transaction/revenue figures don't seem to get reflected in the sp. Maybe once they start advertising they'll get some attention!


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## Richard Willoughby (8 July 2006)

burmans, web sp seems to move more on sentiment than great reports/figures, figs last year generally reflect what has been happening since this company became an internet seller. at the moment my opinion is that it will rise shortly, it cannot keep doubling its ttv without this being reflected in the sp. i don't hold and at the moment can't buy so they are sure to rise.  
cu tricky


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## burmans (26 July 2006)

Another great report and this time the technicals do seem to support the company a little bit, it seems that interest in this baby has started to turn.

Their cashflow looks very impressive.


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## burmans (1 August 2006)

Comment from the Auistralian



> High-flyer Webjet ready to buy
> Steve Creedy, Aviation writer
> July 25, 2006
> ONLINE travel service Webjet expects to build on a 330 per cent profit increase and a debt-free balance sheet to take advantage of "strategic opportunities" and increase its market presence over the next six to 12 months.
> ...


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## burmans (31 August 2006)

Lots of great announcements and no share price movement. How long can everyone ignore a great company!


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## bigdog (13 October 2006)

David Clark, when will the SP increase?

Webjet have been recommended buy with several advisers for sometime.  However the SP has not moved far.

Back in Sept 2005 WEB hit 49.5.  

Since then we have had great results with increased sales and profits and $25 million in the bank.  Still the SP hovers around 0.33.

Webjet ASX announcement Oct 2 2006 reported:
Webjet today announced a further record quarter to 30 September 2006 of total transaction value of $60.2m compared with $39.5m for the same quarter last year.  Commenting, Webjet Managing Director, David Clarke, said:
“In calendar year 2006 we have produced continuous strong growth.

Webjet ASX announcement Oct 10 2006 reported:

Webjet today announced a Net Profit Before Tax (unaudited) of approximately $1.1 million for the quarter ended 30 September 2006.
Commenting, Webjet Managing Director, David Clarke, said: “The net profit for the quarter is a quarterly record result and is after fully expensing the substantially increased marketing cost foreshadowed in our annual report. Compared with the same quarter last year, after an increase in marketing costs of approximately $800,000, (from $400,000 last year to $1.2 million this year) we have at the same time increased profit by approximately $150,000 or 15% (from $950,000 last year to $1.1 million this year).

The marketing costs for the quarter are tracking in an aggressive but tightly controlled percentage band of approximately 2% of TTV and have developed substantially greater TTV momentum with quarterly TTV reaching a record of $60.2 million compared with $39.5 million for the same quarter last year.
This substantial momentum and increased market footprint is currently extending into the October quarter with all indicators currently strong.
Cash flow remains very strong with $25.2 million on hand as at 30 September 2006 compared with $23.1 million as at 30 June 2006, an increase of $2.1 million for the quarter.

Whilst no forecasts are made at this time we are delighted with the result.
Market guidance in relation to capital management and dividend policy will be provided at the forthcoming AGM on 2 November 2006.”
David Clarke
Managing Director
Webjet Limited


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## bigdog (17 October 2006)

Webjet is recommended buy by Intersuisse Morning Notes October 17 2006
per below: 

Webjet (WEB) 
An excellent FY06 continues strongly into FY07 
Buy 
$0.34 

Event 
** FY06 Summary 

FY06 was an excellent year for WEB. It is now seeing the emergence of ongoing value in its business model. 

Key results were: 

* Total Transaction Value (’TTV’) $172.3m, up 125%. 

* Net profit before tax $3.5m, up from $745,000, NPAT slid to $2.38m from $2.74m with an income tax expense of $1.1m compared with a benefit of $2.0m in FY05. 

* Cash flow from operations $4.3m compared with $1.4m in FY05. 

* Cash on hand $23.1m, an increase of $19.5m over FY05’s $3.5m balance, due to operations and a $15.6m capital raising by option exercise. 

WEB sees the general travel market for FY07 as challenging and has given no formal guidance for FY07. But cost pressures on the consumer can also provoke a desire for travel. Currently lower fuel costs will assist. WEB now has its best-ever market footprint following its strong growth in Total Transaction Value (TTV), or bookings in FY06. WEB aims to be a leader in market transparency and continues to report major figures each quarter. 

** FY07 To Date 

On 10 October WEB reported for the September quarter an unaudited NPAT of approx. $1.1m. Compared with the pcp, marketing costs increased from $400,000 to $1.2m. However, NPAT rose by 15% from $950,000 in 1Q06 to $1.1m in 1Q07. 

Marketing costs are controlled at about 2% of TTV, which reached a record $60.2m in the quarter compared with $39.5m in 1Q06 – up 52.4%. TTV exceeded $1m in one day for the first time ever, on 29 August. Announcing this on 30 August, WEB added that it had been rated the No 1 internet travel agency, ahead of Flight Centre, for the previous three weeks, with the help of its marketing campaign with the National Seven Network. 

MD David Clarke says this substantial momentum and increased market footprint is extending into the October-December quarter with all indicators currently strong. 

Cash flow remains very strong with $25.2m cash on hand at 30 September, a $2.1m increase from the $23.1m at 30 June 2006. Further guidance will be provided at the AGM on 2 November. 

The TTV figures for the last seven quarters indicate the rate of growth, in $m successively: 23.5, 23.6, 39.5, 37.4, 45.4, 49.6 and 60.2.


Impact 
** Background 

David Clarke notes in the annual report that during the twelve-month period over 500,000 airline passengers have booked through Webjet. Total Transaction Value has grown from around $5m a quarter in FY04 and shows six half-years of consecutive growth. Annual TTV has shown exponential growth, recently: $20.5m in FY03, $20.8m in FY04, $76.5m in FY05 and $172.3m in FY06, the last up 125% year-on-year. This ‘gross revenue’ produced ‘income’ of $1.4m in FY03, $1.5m in FY04, $5.3m in FY05 and $10.8m in FY06, the last up 104% year-on-year. 

Turnover growth has thus not been at the expense of margin despite major reductions in airline commissions during the year, as was expected. WEB is enjoying increasing economy of scale of its cost base, allowing increased marketing spend (minimal in early years), which in turn appears to be enhancing TTV growth, at least at current levels. WEB is a strong generator of cash and operating cash flow is tracking profit growth, giving capacity for WEB to fund its ongoing development needs for capital expenditure and working capital. The Board is considering options for capital management, strategic opportunities and dividend policies. 

Rapid changes in the travel industry pose challenges to traditional travel agencies as airlines cut back commission payments. This has created extra opportunities for WEB, which has an ongoing programme of development of its website and systems to improve customer experience and keep it in the forefront of changes. An example of recent challenges is the myriad of changing fuel and other surcharges that make true airline fare comparisons difficult. 

** New Initiatives 

WEB has major initiatives to launch in FY07, starting with the introduction of effectively one click online packaging to simplify and extend the ways in which travel product can be simply and economically purchased. Around December 2006 WEB expects to release a ‘transformational component’ of its travel service aggregator,called Planit. Planit will allow users to construction, budget and build both leisure and business itineraries, in an environment that can be shared with friends or colleagues to assist in travel planning in a secure framework. WEB expects it will add a dimension and depth to customers unavailable from any other travel provider in Australia and be a key component in its positioning and strategy. 

WEB is also reviewing the extension of its market entry points in North America, New Zealand, the United Kingdom and Asia. It has launched Webjet.com as its North American site to provide a special focus on Australia, as a destination, to the North American market. Others will follow. These market entry points take advantage of the technology platform and leverage its cost base and product range. 

Additional initiatives already under way include a Trans-Tasman matrix display and Webmatch advertising of city pairs, both to assist users choose from selections of flights, the online booking of travel insurance, and Lotsof Hotels, embodying Travelport content. In April 2006 WEB entered a major supply and distribution alliance with Travelport, assisting it to materially accelerating the sale of hotel and accommodation products in the Australian market. Travelport is a global entity incorporating Cendant Travel Distribution Services, Galileo, Hotel Club, GTA, Orbitz, Ebookers and others. It supplies WEB with access to its global hotel database of some 60,000 properties. 

** History and Shareholdings 

WEB worked with global travel booking services group Galileo, Microsoft and others in developing its latest booking engine. It has had close relationships with Galileo and Harvey World Travel Group (HWT) in its development phases. During the last year, HWT was acquired by S8 (SEL). HWT had taken up various share issues in WEB and S8 sold the total 19% shareholding of 46.4m in February 2006. It continued to hold 56m options. In June 2006 these were exercised at 27.2 ¢ with a payment to WEB of $15.24m. The shares issued on exercise represented some 17% of capital and were subsequently placed, with the approval of WEB, with institutional and professional investors. 

S8 operates a substantial number of apartment and resort properties and has maintained the working relationship with WEB, despite having no remaining shareholding. S8 has acquired Gullivers Travel and Transonic Travel, a division of which, Bestflights.com.au, has just expanded its deal with ninemsn, with a new booking engine. 

David Clarke and substantially the same Board and management team have guided the growth of WEB from the outset. WEB has built depth into its management team as it has grown. Operations, Marketing, Technology, Service, Finance and Programming. Indicating its growing maturity, WEB recently appointed a new CFO after an initial contractual engagement early this year. 

Thorney Holding P/L holds 14.6% of the shares. Galileo, through GIW Holdings CV, holds 8.5%. Director Steven Scheuer holds 7.7% and the Board together hold 11.6% of the shares and 13.7% of total shares and options. Shares currently on issue total 322.1m and options 21.5m. 

** The Future and Recommendation 

There is a clear trend to online booking of airline flights, hotel rooms, car hire and other travel needs. This will continue and in due course the strongest will grow fastest. WEB has competitors, notably the airlines themselves, a handful of major global players such as Travelocity, locally Zuji, flight centre and others, apart from traditional travel agents. Despite the competition though, WEB has attained critical mass and appears well placed to become one of those which grow fastest, or perhaps get taken over. 

WEB first reached its current price in August 2005. We believe the uncertainties of ownership and share structure obscured the progress being made over the last year. Now that these are all cleared, the company has moved into a tax-paying mode, has substantial cash and has extended its excellent FY06 growth further in 1Q07, the shares are due for a re-rating. We have reviewed WEB as a Buy in Morning Notes last October, in April 2006 and on 7 August. Not only has the share formed a strong base but it now appears poised for take-off. 

Based on four times the last quarter, WEB should earn $4.4m NPAT and generate $8.4m of cash this year. We of course expect the next three quarters to be far better than this. The earnings estimates shown in the table are thus seen as very cautious. The cost of a 1.5 ¢ dividend would be just $4.8m and WEB might well distribute more or use other capital management for shareholders. 

The P/E of this internet growth stock could thus be well below 20x for FY07 and the distribution over 5%. Check it out at www.webjet.com.au and Buy - a ticket, a holding or both!



FYE Jun  2005A 2006A 2007E 2008E 
Reported NPAT $m 1.4 2.4 4.7 7.5 
EPS c 0.6 0.9 1.5 2.3 
P/E x 56.0 37.2 22.3 14.6 
EPS Growth % -- 50.0 66.7 53.3 
DPS c -- -- 1.5 2.5 
Yield % -- -- 4.5 7.5 
Franking % -- -- 100 100 

Prepared by Peter Russell. Intersuisse Estimates.
Note: EPS and Net Profit are pre-goodwill


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## bigdog (25 October 2006)

http://www.travelweekly.com.au/articles/22/0c045222.asp

Webjet ready for Planit launch 
Louise Longman

Webjet is gearing up to become the “MySpace of travel” by developing a user-generated site for members with links to packages, hotels, flights and features such as Google Earth.

It will launch its Web 2.0 user generated site Planit in December with the site being showcased on television commercials in early 2007.

“It changes us into the MySpace of travel with an environment to buy, plan, share and talk,” said managing director David Clarke. “It will give us a viral component.”

He said the aim will be to roll it out globally.

Acting as a community site for Webjet, Planit will aims to become a holiday planning centre with users able to share information, offer tips to fellow travellers and have instant chats through MSN Messenger.

Clarke said site will also have a “vault” where customers can store passport details, visa information and medical details.

Photos can also be downloaded onto the site. 

Online packages meanwhile are scheduled to launch at the end of the month. 


18 September 2006


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## bigdog (25 October 2006)

WEB SP has increased 0.045 to 0.39 for high for many many months

Also, ASX announcement today by Flight Centre FLT 

Flight Centre receives buy-out offer
October 25, 2006

AUSTRALIA'S biggest listed travel agent, Flight Centre Ltd, is seeking to privatise under a buy-out offer led by the company's founders and private equity firm Pacific Equity Partners.

Under the proposed deal, minority shareholders would be offered $17.20 a share by the consortium, made up of a cash payment of $17.00 a share and a fully franked special dividend of 20 cents.

The special dividend is conditional on the implementation of the scheme of arrangement following a shareholder vote.


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## bigdog (26 October 2006)

Trading halt - does anyone know

For reasons unknown, there is no trading on the ASX for WEB today

There are buyers at 0.44 and sellers at 0.375

Is there any reason why WEB shares are not being traded today?


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## bigdog (26 October 2006)

Announcement today TRAVELTECH

http://www.traveltechasiapacific.com/webjet-diversifies-as-sales--<br>profits-grow

Thursday, 26 October 2006 10:35:45 AM

Webjet Diversifies as Sales Grow 

Webjet MD David Clarke  
ONLINE retailer Webjet is starting to diversify income by placing its airline booking engine - which already generates most of the company's revenue - on three new websites within the next two months.

Managing Director David Clarke said the booking engine will soon feature on the Travelmate and Need It Now consumer sites, in addition to the Creative Holidays trade site.

The booking engine is part of the Travel Service Aggregator technology platform Webjet developed in conjunction with Galileo and Microsoft.

It can process up to 1000 transactions a minute and has been a key reason for the recent strong business performance of Webjet, which recently announced a net profit for the six months to December 31, 2004, of A$254,484.

Further profit announcements are expected with sales continuing to surge.

February, with just 28 days, was a record month with A$8.1 million in sales (11% up on January) driven by 22,000 bookings covering 30,000 passengers.

"Just wait until you see March," Clarke said.

He added that TSA, which is able to aggregate and display product from disparate suppliers, has allowed Webjet to increase sales while controlling staffing costs.

"Most of the incremental growth goes straight to the bottom line," he said.

"At Webjet we have 16 full-time staff," he said. "The throughput of the best run traditional travel agencies is around $1 million a year per staff member - we can do A$6 million per person."

Clarke said Webjet operates on a gross margin of 7% before costs - 6% is fixed while the remaining 1% goes to marketing, generally evenly split between online and offline.

"I believe you've got to be a visible presence in the real world - it's no good just being a cyber space identity."

While Clarke was reluctant to forecast because of ASX rules, he said "if the model holds true I believe our net margin can fall within the 1.5% to 2% range by the end of the year based on current trends."

Current rampant growth rates will be difficult to maintain, he said, although the company is aiming to double existing (low-commission) airline traffic, which currently dominates income at 60%.

Another 20% comes from car, hotels, and insurance, while the remaining 20% comprises services fees.

Webjet charges a A$6.95 service fee for every transaction, no matter what volume or amount.

"It's been in place for more than a year and we have had absolutely no resistance," he said.

Meanwhile, whatever resistance there was to investing in Webjet has evaporated.

Over the past seven months Webjet shares have increased from three cents to a high of 22 cents (check) and are currently trading at around 16 cents.

Daily trading volumes regularly exceed one million shares, resulting in major paper profits for some of the biggest names in Australian travel.

Significant investors who bought in or struck options deals when the stock was scraping the bottom of its range include Harvey World Travel (19%), Cendant (9%) and Australian Outback Travel (3.5%), which owns Need It Now and Travelmate.

Both Cendant (GDS, hotels and car - Avis, Budget) and Australian Outback Travel (Australia and NZ hotels) are also using Webjet to distribute its products, while the HWT alliance provides it with buying power.

The frenetic stock activity has inevitably led to speculation and rumour.

But Clarke said there has been little or no recent change in the Top 20 shareholders.

"We are not sitting here trying to organise a buyout or takeover," Mr Clarke said.

"If someone makes an offer, we'll consider it but it's not in the business plan or strategy."


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## bigdog (26 October 2006)

ASX ANN where WEB asked to explain SP increase yesterday.

WEB advised that no information not announced that would explain SP increase.

WEB is now trading with SP at 0.39 on good volume


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## bigdog (26 October 2006)

The ann today traveltech attached is a 2005 ANN

Website article date defaulted to todays date

My apologies


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## bigdog (28 October 2006)

WEB looking Ok at Friday finish at .385


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## bigdog (29 October 2006)

Travel agents face 
Melissa Maugeri
October 28, 2006 12:00am
http://www.news.com.au/sundaymail/story/0,,20655654-3122,00.html

EXTRACT from this article related to Webjet
According to Richard Noon, chief executive of online group Webjet, some in the industry haven't realised their role has changed.

Mr Noon foresees a huge shift for agents as consumers access more and more information about their travel destinations via the internet.

Despite many agents predicting customers will limit online direct bookings to domestic flights, Mr Noon says Webjet had seen a bigger growth in its international bookings.

"There's a generational change under way (with travellers), 25 per cent of transactions are done online in the travel sector, in the US it's 35 per cent," he says.

Mr Noon predicts it could growth to more than 50 per cent in the next five years.

"What the internet is not good at is lifting the veil on the international flight combinations available," Mr Noon concedes.

And it is the complexity involved in travel that could prove a limitation for the internet, even when its capabilities expand.

FULL ARTICLE:
AMID sustained travel industry rationalisations, takeovers and the growing impact of the internet, pundits are predicting dramatic changes in the way travel agents operate.

This week's $1.6 billion bid by the founders of travel agency group Flight Centre to privatise the company has put the spotlight on the challenges the industry is facing. 

But will slashed airline commissions and increasing online transactions mark the death of the traditional travel agent?

Industry insiders are divided about how dramatically the role of the travel agent will evolve into the next decade, but all agree agents have to change tactics.

Lucrative corporate markets and niche travel areas are being sought after as the margins in mass discount trade, especially in the once bread-and-butter airline ticketing, are squeezed.

According to Richard Noon, chief executive of online group Webjet, some in the industry haven't realised their role has changed.

Mr Noon foresees a huge shift for agents as consumers access more and more information about their travel destinations via the internet.

Despite many agents predicting customers will limit online direct bookings to domestic flights, Mr Noon says Webjet had seen a bigger growth in its international bookings.

"There's a generational change under way (with travellers), 25 per cent of transactions are done online in the travel sector, in the US it's 35 per cent," he says.

Mr Noon predicts it could growth to more than 50 per cent in the next five years.

"What the internet is not good at is lifting the veil on the international flight combinations available," Mr Noon concedes.

And it is the complexity involved in travel that could prove a limitation for the internet, even when its capabilities expand.

Australian Federation of Travel Agents spokesman Bob Steel, who has worked in the industry 25 years, expects fee-for-service to become more common as agencies look for different income streams.

"There's been a decline in upfront commissions from airlines but more people are paying agents for the time they spend advising clients," Mr Steel says.

And he thinks the impacts of the internet on travel agencies may have been overblown in some quarters.

"It is more of a tool for agents to use with their expertise to advise clients," Mr Steel says.

"A lot of customers now come into stores after they have browsed on the net and then want help in how to make it work."

Travel agent fees for services presently vary from a percentage of a total trip cost to $50-$100 per hour for service.

Independent travel agent Sandra Skelton has seen reductions in airline commissions of about 44 per cent during the past two years. There is no commission on domestic bookings.

But she says corporate travellers, who make up about 70 per cent of Skelton Travel's business, are happy to pay for good service.

"They don't have the time to work it out themselves," Ms Skelton says of her inner suburban customers.

She says her agency focuses on the high end leisure market where internet competition is not much of an issue.

"Our clients want what you can't Google," Ms Skelton says.

"Even the corporates want something different, a boutique hotel geared to business."

She also expects fee-for-service to continue to expand in the industry.

"We realise our expertise and knowledge are valuable and worth paying for," Ms Skelton says. "People don't mind paying for something if they are getting good value and peace of mind."

Flight Centre managing director Graham Turner says he has seen margins squeezed tightly at the discount end of the Australian travel market.

But even he sees the future for his company in providing a better experience for the customer.

At the Flight Centre annual general meeting this week, he spoke about shops of the future that would be interactive for customers and highlight the range of product on the market.

He says he plans to expand the company's internet presence but sees this as more as a service for customers who would come in-store for their more complicated travel plans.


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## bigdog (2 November 2006)

*WEB ANN today potentail great news*

ANN today potentail great news

http://www.asx.com.au/asxpdf/20061102/pdf/3zd26frw9gxjl.pdf

Intended to pay pay maident 0.5 cent dividend in Oct 2007 - gets rid of cash and improves ratios suggested in prior note

SMH today reported:
Webjet looking at potential acquisitions
November 2, 2006 - 11:29AM
http://www.smh.com.au/news/Business...al-acquisitions/2006/11/02/1162339960965.html

Online travel agency Webjet says it's looking at potential acquisitions and expects opportunities will arise before the end of this year.

Webjet said it was examining the possibility of strategic acquisitions which would allow it to expand its business.

"A number of possibilities are under close examination both internally and in conjunction with our external professional advisors," Webjet said in a statement ahead of its annual general meeting.

"At this juncture no definitive proposition has been determined but in view of the major industry consolidation which has taken place over the last 12 months, the board considers that there is a significant possibility that appropriate opportunities will arise before the end of the financial year 30 June 2007."

Webjet said if it doesn't make any acquisitions it intends to announced a buyback of five per cent, or $5 million to $7 million, of its issued capital.

The company also said it expects to pay its first annual dividend, of half a cent per share, in the 2006/07 year.


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## bigdog (16 November 2006)

Webjet's plans to profit from your travel information
Email Print Normal font Large font BEVERLEY HEAD
November 7, 2006
TheAge

In APRIL next year Webjet will launch PlanIt, an online service for travellers. Chief executive David Clarke says the company has invested about $1 million developing the service and the same again on marketing.

PlanIt will allow travellers to store their travel budget, share their travel plans with friends online, upload photographs, link to Google Earth and all of Webjet's travel and booking services. It will also provide TravelVault, a secure and encrypted environment where users can store personal information such as passport numbers and spectacle or medical prescriptions, which they could access when overseas and download on to a memory stick or portable storage.

For the week of October 7 it was the eighth most popular travel site in Australia and, according to the BRW Fast 100, its 131 per cent turnover growth makes it the country's 20th-fastest growing business.


Full article:

http://www.theage.com.au/news/bizte...vel-information/2006/11/06/1162661616348.html


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## bigdog (24 November 2006)

Nice profit and probably the reason for SP drop from 38 to 36.5 cents yesterday

Nov 21 AXS ANN - WEB issues 2,000,000 @ 0.17493 = $349,860 to Managing
Director (David Clark) pursuant to ‘Resolution 4’ approved at Annual General Meeting held 10th November 2004.

Nov 24 ASX ANN - David Clark sells 1,938,226 (ord. shares) for $731,486 

No. of securities held after change 161,774 shares and 4,000,000 options

I hold WEB


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## bigdog (2 January 2007)

WEB Webjet ASX ann today

WEB 10:52 AM  Growth Continues 

http://www.asx.com.au/asx/statistics/showAnnouncementPDF.do?idsID=00682602

WEBJET GROWTH CONTINUES
Webjet today announced Total Transaction Value (TTV) of $56.7m for the quarter ended 31 December 2006 compared with $37.7m for the same quarter last year, an increase of 50%.

TTV for the six months to 31 December totalled $116.9m compared with $76.9m for the same six months last year, an increase of 52%. Commenting Webjet Managing Director David Clarke said, “We are particularly pleased with the continued growth and clear increase in market footprint.”

I hold WEB


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