SDR - SiteMinder Limited

SiteMinder Limited (SDR) owns and operates the world's leading open hotel commerce platform empowering hotels and accommodation providers to sell, market, manage and grow their business from one place.

The Company's innovative online platform offers hotels and accommodation providers a comprehensive range of products and solutions to manage and streamline the distribution of their rooms across a wide selection of direct and indirect channels, take bookings from guests and communicate with guests.

The platform helps hotels get insights on their performance, connect to a wide range of tools to manage their business, and process payments. SiteMinder give its customers the tools to grow reservations through direct customer acquisition as well as established global and regional travel channels, increase revenue-generating opportunities and eliminate costly manual processes.

SiteMinder is a global business with the larger footprint than each of its direct competitors. The Company serves over 32,000 properties of all sizes in over 150 countries, employing staff in over 20 countries across six global sales hubs and seven offices and remote working locations, and offer a multilingual platform in eight languages.

It is anticipated that SDR will list on the ASX during November 2021.

another big IPO

Another big float, that will keep the punters happy. Company now has a market capitalisation of nearly $1.3 billion.

SDR opened at a premium on Day One, at $6.51, before quickly running as high as $6.90. The shares have now settled back and are trading around $6.77

not much on this since listing... 3 years on ASX .. Market cap close to $1.4B



Brokers love it ... 9 Strong Buys, 2 Buys, 2 Holds.
Mirrabooka added it to their portfolio in the last FY

Early investor BTI sold down a portion of holding 30 Oct

...completed a $20.0m cash realisation of a small portion of its investment in SiteMinder, while retaining 82% of its holding. The realisation was via a trade at an average price of $6.65 per share, 5.2% above Bailador’s previous carrying value of SiteMinder.

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at the AGM
The company has continued to perform well in the first quarter of the 2025 financial year:
● Net property additions are tracking ahead of last year with continued focus on larger properties which present attractive long-term revenue opportunities for the company.
● The adoption of transaction products continues to grow across incoming and existing customers.
● On the Smart Platform, we are progressing as planned with the commencement of the Smart Distribution Program. Channels Plus is on track for its full commercial launch in January 2025, and Dynamic Revenue Plus is progressing through its staged launch program with positive early industry feedback.

Our guidance is unchanged. We continue to target organic revenue growth of 30% in the medium-term, aided by contributions from the Smart Platform. SiteMinder also expects to be underlying EBITDA profitable and underlying free cash flow positive in FY25, and make continued progress on the Rule of 40.

Are investors missing the boat on this future ASX leader?​

The market is underestimating the clear path to profitability

Roy van Keulen
15 January 2025


Our perception of narrow-moat Siteminder (SDR) as a future category leader in hotel e-commerce software isn’t reflected in current share prices, with shares significantly undervalued compared with our $10 per share fair value estimate. The shares have fallen close to 14% in the last 3 months.
Market concerns seem to center around the company’s continuing lack of profitability despite an unusually supportive economic background in recent years. These concerns are understandable. Since 2022, markets have clearly expressed a desire for emerging tech companies to demonstrate that they have the potential to generate profits. SiteMinder’s string of losses can, therefore be read erroneously, as an inability to generate profits.

However, we see a clear path to profitability. We expect SiteMinder to achieve profitability in fiscal 2026 and to continuously expand earnings.
First, we see a limited impact from cyclicality. Although an increasing share of SiteMinder’s revenue is coming from its more cyclically exposed transaction revenue, this revenue has lower gross margins than the company’s subscription revenue, limiting the impact on the company’s bottom line. Given that we view the company as only being in the early stages of a long secular growth trend of digitization in the hotel sector, we believe the company’s results are primarily driven by secular trends, not cyclical ones.

Second, we believe that unusually high investment into research and development should ease. SiteMinder has launched more substantively new products than any company in our Australian technology coverage. These newly developed products are unique in market and therefore don’t require similar spending levels to stay competitive. Rather, these recent investments will allow the company to pull away from competitors. We expect research and development to stay relatively fixed in the future and to decline as a share of revenue.

On the road to profitability​

We expect SiteMinder’s strategy to be wide-ranging, including a focus on attracting new customers, increasing penetration of its current product suite, and developing and launching new products. We view SiteMinder’s strategy as appropriate, despite its wide-ranging nature, as all three focus areas provide large and highly winnable opportunities.
We expect SiteMinder to take significant market share within the hotels industry. SiteMinder’s market share among hotels currently sits in the midsingle digits, yet SiteMinder is the leader in its space, and has twice the market share of its closest competitor. We expect scale-based cost advantages to drive consolidation in the channel manager industry, as subscale players are pushed out of the market and scaled providers, like SiteMinder, take share. Specifically, we expect SiteMinder to take dominant market share in larger single-location hotels, and in hotel chains outside of the largest chains.

We also expect SiteMinder to increase its take rate through increased penetration of its existing product suite, especially through adoption of its transaction-based products. We estimate transaction-based revenue currently makes up around 10 basis points of the gross booking value, or GBV, of SiteMinder’s customers. For comparison, SiteMinder Pay has a take rate of around 2%-3% of payments that are processed through a hotel’s website or, from fiscal 2025, also on payments processed at a hotel’s premises. Similarly, SiteMinder Demand Plus has a take rate of 15% on incremental demand generated through search engine optimization.

Finally, we expect SiteMinder’s new products to be significant growth drivers, especially Channels Plus. We expect Channels Plus, which aggregates several smaller channels into a single channel, will see rapid adoption among SiteMinder’s existing customers, and help attract new customers. Although the take rate of this product is like that of payments, we expect its uptake to be much higher, due to its more differentiated nature, as well as the clear value it provides.

SDR bulls say​

• SiteMinder is the world’s largest e-commerce software provider for the global hotel industry, at twice the size of its nearest competitor.
• SiteMinder has a large and highly winnable market opportunity, consisting of increased market penetration, product penetration, and increased digitization of the hotel industry through new products.
• SiteMinder’s Channels Plus product is a unique and highly valuable product that will accelerate customer acquisition and take-rate expansion.

SDR bears say​

• SiteMinder’s end markets are highly cyclical.
• SiteMinder’s market share currently sits in the midsingle digits, which leaves significant room for new competitors to come in.
• SiteMinder has a history of losses and may struggle to achieve profitability

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market cap of $1.6B

No real news in Jan; CBA and MUFG playing silly buggers at the 5% holding mark.

$6.37

● Reported net loss improved from ($14.9)m in H1FY24 to ($13.9)m. Reported net loss included ($4.9)m of restructuring costs. Underlying net loss improved from ($13.8)m inH1FY24 to ($9.0)m.
● Underlying free cash flow improved from ($8.7)m in H1FY24 to ($0.6)m. There is seasonality in SiteMinder’s free cash flow with staff incentive payments made in the first half of the financial year.
● Available funds were $68.6m consisting of $36.5m of cash and funds on deposit, and$32.2m of undrawn debt facilities.

market Update on 26 Feb - not well received

@mullokintyre

A singularly unsuccessful tip for the CY2025 competition. There has been a poorly received 1H results announcement, and the SP is falling away ever since. What will the next update bring?

a steady retracement as per my cunning plan to stand out in the CY2025 tipping comp @mullokintyre

and has been as low as $3.40 during the year

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not much news in April; a few instos buying in.

Dona Ferentes said:

a steady retracement as per my cunning plan to stand out in the CY2025 tipping comp @mullokintyre

and has been as low as $3.40 during the year

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@mullokintyre

get knocked down, don't get back up again