Despegar.com Corp. (NYSE: DESP) reported Q1 EPS of ($0.22), $0.07 better than the analyst estimate of ($0.29). Revenue for the quarter came in at $76.1 million versus the consensus estimate of $78.25 million.

First Quarter 2020 Key Financial and Operating Highlights
(For definitions, see page 13)

• Gross bookings on an FX neutral basis declined 19% year-over-year (YoY) and as reported declined 32% YoY to $790 million
• Revenues declined 34% YoY on an FX neutral basis and 43% as reported to $76.1 million. Excluding extraordinary cancellations due to COVID-19, as reported revenues would have declined 33% to $88.6 million.
• Transactions and Room Nights down 23% and 30% YoY, respectively.
• Share of mobile transactions up 551 basis points (bps) YoY, accounting for 44% of total transactions
• Net Promoter Score (NPS) up 250 bps YoY considering January and February activity.
• Packages, Hotels and Other Travel Products accounted for 51% of total revenue, down 1120 bps when compared to 1Q19
• Excluding Extraordinary Charges, Adjusted EBITDA was negative $1.4 million. Reported Adjusted EBITDA was negative $15.6 million compared to positive $15.2 million in 1Q19
• Operating cash flow negative $68.2 million in 1Q20, compared to negative $6.0 million in 1Q19
• Structural Costs declined 17% quarter-over-quarter (QoQ) reflecting streamlining implemented in 4Q19 and first cost containment measures introduced in early January 2020.

Message from CEO

“Our results during the quarter were impacted by the COVID-19 pandemic, which has severely disrupted travel worldwide. We entered this global health crisis, with a strong balance sheet and healthy liquidity, closing 1Q20 with a cash position of $222 million, no long term financial liabilities and only a minimal amount of working capital short term debt. We continue to carefully monitor our liquidity position and believe we have sufficient resources to weather the current challenging environment, for the next twelve months.

We proactively addressed the impact of COVID-19, reducing our costs to better align with the decreasing demand. We substantially reduced marketing spend and we are pulling SG&A levers to cut costs. We are well on track to achieve the reductions in Structural Cost targets, which declined by 17% sequentially to $43 million this quarter, and expect to bring them down to $34 million in 2Q20 and $28 million by 3Q20.

Importantly, despite the measures announced, the Company remains ready to adjust to a quick ramp up of travel activity, when required.

The initiatives we have implemented in recent years have allowed us to set in place a low-cost delivery model and an agile and asset light company. And coupled with the cost savings program recently implemented, we are better positioned to meet the challenges ahead. While the depth and longevity of this health crisis is uncertain, we believe we will ultimately emerge as a stronger and leaner company. Furthermore, due to our competitive advantages, the strength of our brand, our digital capabilities, and our broad and compelling product offering, we are confident we can quickly start re-capturing market share in a more hospitable competitive environment.

In sum, we have also accomplished a great deal toward our overall strategic goals over the past 2 years. While we have had to adjust our near-term priorities, our long-term market opportunities and growth strategies remain intact and could even be more favorable given the accelerated shift to online travel we are already seeing across industries.”

For earnings history and earnings-related data on Despegar.com Corp. (DESP) click here.