Q2 2020 Despegar.com Corp Earnings Call
Good morning, welcome 'cause it does for our second quarter two girls, it's one of your earnings call.
Slide presentation accompanying today's webcast.
On the Investor section of the company's website Www dot investor the dust regard dot com.
There will be opportunity if you ask questions at the end of today's presentation.
This conference call is being recorded.
As a reminder, all participants will be in listen only mode.
I would like to turn the call overcome this Natalia Nierenberg Investor Relations. Please go ahead.
Morning, That'd be one okay for shiny yesterday for a discussion of our kick off work that keeps on getting besides.
He said he sometime before he probably nice every size or that you would.
Accepted I'll be brief people, we discuss certain non-GAAP financial measure kind of backing metrics, including foreign exchange means that calculation.
Im sorry should we did if you need shows up these measures on metrics included in our press release exactly to ensure that Dan that's something that.
Non-GAAP financial measures I know, but I didn't medscape shall not be goes. He then it yeah. So nation substitutes for happier to GAAP financial measure and that nobody that property men's I information on me.
Before we begin I, what form I realize I don't need to remind you that certain statements made during the course somebody's passion Michael seat you. Its forward looking statements, which are based on management's current expectations wouldn't be.
I haven't checked with number of free and uncertainty that group called Actuaries has not.
He brings shop doors that maybe beyond the company's controlling.
Thank you.
Our nation assumptions relating to the impact of that called me Nike by sent me.
For a description of each week.
First of all are fighting we'd just like you even exchange Commission I know what breast meat.
You know do they boy, it's always T O that me on smoking, who will provide an overview of the fickle warfare and update you on our strategic priority I backed up by half me our CFO will so once we got the well find out shows.
So that we opened that goes to your question.
I'm sorry go ahead.
Thank you got probably a good morning, everyone I'm, saying people would tell you I hope that you on your hobbies, a healthy young type.
This past quarter was really talent on many fronts knot shop for us as a business, but for all of us to global need.
No doubt that'd be called is 18 pandemic hops profoundly impacted our business over the last few months.
You can just I'm extraordinarily changes and challenging our team we sponsored deals with a deal.
Executed well it gets hot stuff, we did not work on coal.
Importantly, we remain hopeful on the whole <unk> area, we shared with you during the last earnings call, we Chuck cars.
As far as though reduce the cost structure and reinforce our gosh preservations strategy.
I will enhance our cash position through the backing off to Premier Global investors, sorry, we made significant progress on our M&A strategy.
Lastly, we are adjusting our value proposition do they knew market circumstances I like no just spend a couple of me it's got to each of these topics.
Starting with cost structure reduction.
The crisis, because we need you talked in past calls I mean, I push sobbing patch, we made the number of very difficult, but block, but just to our cost structure, which include some permanent changes.
I worked out and we have exceeded our previously discussed 34 million run rate for structural cost.
Now on target to me I worked 28 million goal.
That's helpful worked out of two helps on the plane.
Additionally.
We are probably going into corker implementing a range of boxes to kind of month pain I were strong liquidity and indeed, the pork, though with a cash position. She wheeler do that at the end of Q1.
We made significant progress collecting outstanding accounts receivables you know these young regulations in some geographies such as Colombia, but a few.
Who provide customers with benzene troubled with boutrous, we'd be magoo for future use.
These process.
Sure. So ill tell you that negotiation of our non joystick payables, which enable us generally cash this quarter. Despite the circumstances.
I am proud.
Quick and decisive actions, we've taken the company who need to get many of the college is whats right.
As we shared with but actually we have taken to better align our cost base, where weve I would anticipate New York Topsides before.
We navigate what may be it choppier recovery in the crops industry worldwide.
They can.
Not only do we want to push her gosh, we also want Dee Ann.
And how does our liquidity position I said precautionary measure.
During the quarter, we secured a 40 million committed revolving credit facility, we they was Yorktown.
So today, we have not gone on beeps Watson.
Subsequent to quarter, one we're rice 200 million.
Copied flip broad good placement with two or we like the probably like would you fun and haven't done and white hot topic I.
I wouldn't you Barbara share our vision of the future the of the all I can probably industry Latin America.
Support our wrong on the lid up them out.
This new financing also provides us additional flexibility to navigate.
And it.
Oh, we continue cupped would anybody opportunities without the effect, you know where liquidity.
Previously disclosed we successfully renegotiated the terms of the pending best they acquisition, we've got a reduction of 58% of the purchase price.
Importantly, we before any cash outlay for said in six months after closing.
The acquisition, we allow us to four of them strengthens our presence in Mexico develop new Bard, because I'm not cheap synergies that will be far the boosted by our low cost seven allowed you got lots so.
Additionally, subsequent to quarter and we acquire caused a leading brasilia on like point of sale payment platform.
These acquisition will further enhance our payment I suppose offer.
Yeah.
We're also working hard to strengthen our value proposition, we the more flexible product offering.
We have accelerate our air force to add further automation.
Well the customer food feeling process. These actions will not only in the hands customer satisfaction, but also reduce our cost through good reduction college to our calls.
I think we leave our organization through the crisis and they need some economic disruptions.
Our boss screening navigate difficult period.
Sorry, that's what.
In time.
Thank you to pools as opposed to in near future.
Ah why do we well season I was wondering whether the pandemic, we will certainly continue fighting the headwinds from the post crises.
Moving next what do they got some of the circuit court that sense touches on gross bookings.
I wish it out during the first quarter of two Hilton and put the argues called the stick on partner was expected to be the most college import guarding the company's he study.
In the quarter Consumptions on gross booking comedies, 90% to 96% respectively.
This was due not only.
With that I'm not dropping their money, but also from the restrictions imposed by the different governments in the region. That's most countries basically shut down there a column.
Back to other countries and regions Westrick shows in some left some countries have just Argentina, Colombia had been rather long answer to you.
Additionally, although Latin America walks the last major geographic region to be bought by Colby traveled bonds, but implement.
At the same guy asked to Europe.
Dr limitations to travel have been in place for a longer period of time under recovery has not yet begun.
I will now you have a little bit more detail Oh, how the quarter played out.
This is in Beijing for you seem that chart on the bulk of right of the page.
Hey, Brian well the slow with Muslims the court, though we turn structures on gross bookings drastically below the same real though probably are you.
We saw an improving trend as we moved through the quarter with gross bookings in June doubling the May 11, and continues to improve in July and August.
Well I don't wedding college by this improving monthly trend, we want to remind you that they're still high degree of uncertainty in the market.
Causes us to take a concern about the approach as we look into the near future.
Moving next to slide five for discussion of cost savings and target.
Probably your call, but like.
We are already working in our cost savings program.
You do the completion of somebody needs that we launch in 2018 2018.
Taking a series of actions over the past required us to reduce cost and become a knee but leave their comp.
That included achieving efficiency gains in support area in Argentina restructuring, our food Feeney men scent and reducing our corporate and supports headcount significantly.
Thanks to these exports, we could that cheap sequential reductions of 25% in payroll expenses lighting person in non payroll cost during the second part.
So we saw.
Our structural cost declined 23%.
When compare to the first quarter 2000 and but.
Why operational cost overall, excluding one time charges was down 62% year on year.
Additionally, we surpassed our her competitor of two cells on can probably get.
Readied for media.
No one truck to meet our third quarter golf.
Despite these cost reductions, we still have the ability to quickly ramp up the troubled markets start to recover.
Turning next to like see 40 discussion or not what cash preservation strategy.
Indeed unprecedented hi.
Gosh perturbation, along with strengthening financial up because he's keep <unk>.
Importantly, not only did we preserve our cash balances grew this quarter and being flat we quarter one.
We also generated 20 million in cash.
It totaled 66.3 million or Pete you see percent. The trade accounts receivable was net of provision for bad, but I related part to receivables as of March 31st 2021 collective during the quarter.
This performance because you are one of our ability to navigate crises and the strength of our receivables.
Moving next to a brief discussion about our financial obligations.
We closed the quarter without it doesn't mean young in short term debt I know long from that.
On the high nothing front during the quarter, we secure 40 million revolving credit facility, mainly to have the financial flexibility if needed.
Today, we have not drawn on the spotty.
Yes, so they will close at 200 million Topicals right.
With private placement, we two funds that's hardly to support our liquidity position.
This brings our thought out pro forma cash position as of June 30, 20 plenty to over 420 million.
And I will discuss these new financing in more detail truck.
Moving next to slide seven put discussion about what we said 200 million copies otherwise.
We engaged with who aren't really good fun.
First $150 million from L. concept on through the sale of preferred stock Blackwater.
Second right $50 million go walk up to.
Hey of newly issued series B preferred shares come back to move into ordinary shares.
Hey concert on one of the largest and most global consumer focused private equity funds that have successfully beating best in Latin America I enjoy probably said why why copied Gov has a strong track record investment companies that provide growth opportunity.
Crossing.
From this transaction will be out okay, maybe to Miss I mean, if we didn't know what equity account you know of our balance sheet.
For more details on this transaction referred to this slide and do they see K filing moving next to slide eight.
The recent topic or wise will enable us to continue growing our business by strengthening our competitive LIBOR.
Would you say key strategic initiative for us as discussed during our Investor day in December.
The timing of the copies otherwise. It's also important an opportunistic I see provides the financial flexibility to allow us to enhance our leading position I'm doing this unique period in time as many local competitors I was struck let me discuss it.
A few key strategic reasons.
First we want to advance our digital products and services through the integration of the multiple brands that that will be part of the display got ecosystem. Now. This powerful network also who's calling our recent acquisition, which we we will explain in detail truck at the same time, we will be.
Supporting further engagement throwing up which is already one of the most downloaded probably labs in the region cycle.
In our low cost than anybody mobile platform translates into better value proposition.
Promotes flexibility in our offering which is key for our customers, but equally particularly in these uncertain times.
Literally by enhancing automation to our processes and making the integration of acquired companies more Jay we come farther type cost.
Although we are already one of the largest opiates in the region they still Abu.
For us to grow further as we speak to strengthen our leadership in the industry.
In a global travel industry, but he bike called with my team role will be opportunistic and she shows you send attractive near term option for us.
I want to new partner also share that <unk>.
All these my team has provided us with a unique opportunity to acquire assets at valuations significantly lower than those we were seen over the past few years.
And on best they are good examples of these.
This new copy that arise provides us with additional liquidity to continue executing on out on our M&A.
So we may end up with how they barely focused M&A started geographically, Mexico, and Brazil, I will keep target markets even sizes. Unfortunately.
And our target companies must also exceeded its course said Oh competencies.
Such a strong brand awareness.
Focus on the leisure traveler as well as unique online on our products how Bobby.
Got it would be quick for us to adopt and leverage across our platform.
Now please turn to slide nine.
But if they use an important up we'll see some for us I see it increases our presence in Mexico, It keep travel destination marketing.
We covered Nitin rakesh.
Breaking hobbled on the global Tableau market, we went back to the sellers to Renagel should the times.
As shown in these page we have highlighted the keep comes from the reach an agreement as well after we buy one.
As we have already goes these health conference call to discuss the key items that I want to reiterate I.
That we were able to achieve a lower price and before any cash outlay until 36 months after close.
We expect to be closing this acquisition in the second half of 2020 ones were paying regulatory I'll tell you stations.
Now moving to slide 10 yesterday, we closed summed up what she's got caught the company. He said roughly your feet thick that operates at a point of sale consumer lender for travel related Cub.
In Sally to self fund they team we have been operating coins financing solutions on our website to our customers in Brasil.
Got it offers a body no pay like installment solution to pull it up a plateau.
For those of you who may not be probably yet political party lateral you kind of feature but he payment methods regulated by the central Banco Brasil.
You said Bush payment system that in 2018, getting very close to 4 billion transactions and accounted for approximately 19% of all online payments on such as.
Well it thought he said my for companies doing online business in Brazil.
On the Blue boxes on the left side of this slide you can see our POPSEQ corset of distinct competencies as we laid out during our Investor day in late 2018.
Let me discuss each one to give you an idea of white, calling makes so much sense for.
Okay.
Close to 5 billion gross booking flowed through our plus four last year.
Therefore, what demand comes back we can leverage the calling financing solution.
Our strong brand has also allowed that we'd recognize I should say platform to conduct purchases right now gone. So only offered to resi and custom I do have a deep understanding of let them customers trouble purchase preferences discussed translated into more than 24 billion, let them customer.
Over the past five years.
Like we have a best in class frog, a narrow spots from I know, what 20 years of you X experience as well as one of the base.
I did teams he left them.
Oh, it's not an unknown entity to us we have been providing these solutions dollar Brasil customers put over one year with over 50000 ton section generated in that time.
We don't see any race in the integration of both.
As of June 2020 coins loan book amounted to only 30 million realities, reflecting the disruption of Colby on the global problems.
Summing up we have a broad understanding of how to finance our customers because we have been providing that service to our consumers follow but 20, yes I think.
I think that solutions. He said, that's really complement to our product offering that allow us to up new capabilities and be continue offering innovative solutions to our customers in the attractive resi and Mark next gardening tools like <unk>.
I have seen us more I mean, nobody baby bucket.
Even in a time of uncertainty we know innovations remain critical driver business.
Adapting to that poor market conditions, we have introduced a flexible booking offering that allows our consumers to reschedule creeps as needed.
During the quarter. We also added value for our platform by building a more robust help experience that will allow our customers too fast money to bookings, while reducing their need to conduct our carlson.
We approach to these new Sotheby's by having the main questions. We have been receiving for consumers and the same time were able to anticipate when consumers will start redeeming about just I started restrictions get leap.
Additionally, and in the case of Refundable times.
Customers will be able to consider refunds online.
So these are like help experience, we will be able to four was curious unconcern.
Who there right.
Creating a more efficient and just fine process.
We'll now turn call over 12, better so who's got the financial performance in more detail.
Thank you Tim Young Oh, Thank you all for joining us today.
I want to bid on day minutes remarks.
Uncommon on our team's ability to adopt execute.
And make smart decisions quickly doing this unprecedented times.
As we expected on shared last quarter. The second quarter was extremely difficult with a topline challenged due to koby 19 related softness in travel demand.
Revenues were also negatively impacted by 13.9 million customer cancellations.
Both reflected refund issued in the quarter.
Well as provisions covering potential customer cancellations through the end of September you know a main markets.
Remember that in the first quarter, we have made provisions for cancellations in second quarter 2020, except for Argentina, where we took provisions for cancellations covering up to the end of August.
This increase in calculation is driven by the effect of more customer friendly refund initiative implemented during the second quarter.
By delivering on it we have resold approximately 64% or non air and 90% of air ticket cancellations.
Excluding these extraordinary cancellations completions.
Revenues would have decreased 96% to 4.2 million in line with the decline in transactions on gross bookings.
Moving on to cost on slide 12.
Let me share that we have dramatically taken cost out of the business in areas, where we cannot currently operate you took over 19.
Including making difficult decisions to reduce stuff on to simplify our organization.
That's a result.
We reduced structural cost to by 23% sequentially to 33.1 million in the second quarter.
Exceeded our run rate goal for the quarter by 3%.
This represented a 35% decline from fourth quarter 19 levels.
These.
Not only allowed us to navigate through this period of limited revenues, but also took repair the company for a slow on non linear ramp.
As governments adjust travel restrictions.
Now taking a deeper look at our cost structure and the steps we've taken throughout the company.
First quarter revenue recline, 66% year on year of we significantly reduced variable cost such as cost of installments.
Additionally, grey card purchase and piece decline mirroring the lower level of transactions.
There was also an important cat infotainment center cost.
Oil window sourcing of these services that we used to provide any house.
Second selling and marketing expenses, what treme to bite, 86% against the same quarter last year.
As we basically curtailed all direct marketing activities.
Excluding the impact two months from yeah, it's part of it.
And 2.9 million in severance charges in the quarter.
The decrease would have been even more relevant.
Nine down 97% year on year.
Technology and content plus DNA increased 9% year on year impacted by 15.7 billion an extraordinary charges.
Importantly on a comparable basis on excluding these one time charges along with two months of the efforts following that.
Deck content plus Jenny.
Would have declined 39% year on year.
Of these extraordinary charges, 89% represent non cash items, comprising 11.7 million in expected credit losses from for Airlines in Latin America, that's filed for bankruptcy on how familiar related to the accelerated amortization.
Oh proportion of jackets Falabella no uncalled for 40.
Importantly, we have provision these two button that charges to fulfill the prudence principle of accounting.
However, we remain confident we will be able to collect decent amount in the near future.
Turning to profitability on slide 13.
Comparable adjusted EBITDA for the quarter was a loss of 32 million.
Compared with a gain of nearly 3 million in the same quarter last year.
Comparable adjusted EBITDA excludes nearly 34 million extraordinary Chargers include in second quarter 2020 in connection with coconut team.
Customer troubled cancellations severance payments from recent cost saving measures on provisions for bad debt in connection with the Threed Latin American Airlines that filed for chapter 11 in the quarter.
We also incurred other extraordinary charges related to the suspension of operations of our younger Brazil.
Discussed earlier.
The one time M&A another professional services expenses.
Comparable figures also exclude 10 million extraordinary charges in second quarter 19.
Maybe rebranding costs and to a lesser extent the cessation of operations some of the on coverage.
With respect to the 7.3 million, we provision for the C Airlines bad debt.
And in ongoing discussions with them.
I remain confident that will recover a significant you've not all way so.
Subsequent to quarter and we have collected over 200000 doors.
Next liquidity on slide 14.
Let's face it isn't as strong financial position and we ended the quarter with just over 228 million in cash and cash equivalents flat with March.
Despite the challenging demand environment during the quarter we generated.
The cash from operations of 20 million, reflecting a decline in receivables and higher trade payables.
This was up from 900 million same period last year.
As we have mentioned we are encouraged by the slightly positive trends, we are beginning to see.
Yes bookings in June and July were better than the notion we so early in the here.
So far in August gross bookings have retain this positive trend.
In this context, we continue to operate in unprecedented times with many unknowns uncontrollable factors still impacting consumer behavior on the travel industry.
Despite this we remain focused on four goals as we continue to adjust to the current operating environment.
First focus on cash preservation and generation Y., leveraging the newly added flexibility told value proposition.
Brazil, and Mexico remains our key growth markets.
Taking advantage of unpaid marketing by cutting channels.
Second maintaining strict focus on cost controls.
Third continue to protect liquidity well at the same time, taking care of our customers as we continued to assessing the recent are still pending.
And finally, as we've done with that best day, and most recently we coin.
They're taking advantage of the current competitive environment to pursue selective M&A opportunities that complement our business I can benefit from on operating leverage.
In conclusion, we're extremely proud the way our team on industry partners have reached into the occasion.
I remain confident our business and our guns would emerge even stronger on the other side.
This short term disruption tolling business does nothing.
To dampen our long term prospects.
With this we conclude our prepared remarks.
Operator, you can open the line for questions.
Thank you we will now begin the question answer session.
Ask a question you remember Star then one on the Touchtone phone.
We're using your speaker phone, we ask you. Please [laughter] compression the key to.
Who are chartered a question. Please press star then to.
Today's first question comes from Edward Wehmer with Keybanc capital markets. Please go ahead.
Hey, good morning, Thanks for taking my question I guess first I noticed that sequentially. The payables to travel suppliers went up just kind of curious how that happened given the revenue trend.
To as as environment improves and you start to have consumers redeemed vouchers, how how will that get reflected on the cash flow statement or just maybe more simply kind of the does that then become trade payables as you start to pay your travel suppliers and then finally with the acquisition of coin.
Does it now start to exposure to more consumer credit risk. Thank you.
Hi, Ed Good morning, and I've got to here so.
And Matt. Thanks for your question with regard to two to two actually trade payables going up.
They have it can be.
Marginally up Okay. The company has got something okay. Yeah. So from that perspective that is pretty much they buy it.
With regards to you didn't ask a question about certain of the receivables from the could we showed good performance when it comes to our ability to collect receivables in quarter two actually questions around this topic and we were able to collect over 50%.
When needed.
Liquor volume or chart Bucks et cetera. So that's these nice devoted and the performance.
And with regard to your second question.
On on coin, Okay, I think it's important to highlight.
In the current was the current volumes that coin is processing, our diminimus be have read what is the.
Run rate of the company when the market comes back Okay. It was why we are actually betting on it who who do this platform is to continue increasing the they offer.
The different solutions a method of payment.
The focus is more on metal basis, rather than run it on their risk management on parts you know as you know okay. All these consumer loans can be securitized.
The plan of the company is less so and actually in getting on increasing exposure is to do our clients great risk by more importantly to continue increasing the number of that the metal payments available.
Target in a market that as you know is particularly particularly relevant.
And with that makes a difference with the big on bond population in Brazil. So.
So hope that addresses your question.
Thank you.
[noise]. My next question today comes from Earth churn would you be US. Please go ahead.
Thanks, So much for taking my question everyone's well.
Just as our team and staying safe.
Two longer duration questions. You know you appears your global peers have talked about it taking multiple years to get back to the levels of travel we saw in 2019.
But in your region of the older. Obviously, there are dynamics around offline to online penetration ships.
Mike speed up a return to those types of volumes are levels. So first question I wanted to know what your general World view is on how investors should be thinking about a multiyear recovery and travel volumes in your business and second on the cost saving side, obviously, you've done a very troubled repositioning.
<unk> business on the cost side for the current environment, how should investors think medium to long term about the permanent so some of those cost cuts.
At the end the goal maybe being larger margin trajectory in the business over the medium to long term versus some of those costs I wouldn't come back into the model as end demand improves. Thanks, so much.
Hi, how are this is the one thing to look for your question in terms of market.
Return are coming back a you're right into that in Latin America, you, probably know historically and these 2018 was so opportunity only 40% of total bookings.
Being transacted online so there's more room for growth and.
Certainly the consumer patterns of the Bundy may have more who have sheet or accelerated achieving two online for many but because we expect that to accelerate the growth of the portion of online when the time industry. How you said that I would view a window certainty.
Of these companies that easy will also pay.
A couple of years at least to recover to previous two pre coveted levels again, maybe accelerate the likely by in foster shift to online.
But that will not a represent a significant.
Difference from the middle market that our currently.
Obviously these will we will evolve unwilling monetary very closely.
But we don't see a significant change based on that partner.
[laughter] as per your second question does have a martinez and the cost reduction and the but Martins.
Yes. It is I believe that you have been has done is a bird job.
Using cost and we believe that the when volumes return our cost base. We remain the same into parts factors, but obviously in the technology Dean they use experienced team and more importantly, the operational team we need to grow.
A fraction of the growth of the board.
We expect therefore that my teams.
We return to higher level and previously basin. This new construct and these new cost base. So the new normal we speak to be at higher margins than in the bye.
Thank you so much.
Our next question today comes from Brian No walk with Morgan Stanley. Please go ahead.
[noise] morning. This is a Alex Wong on for Brian Thanks for taking the questions.
First one just on the gross bookings trend you referred to.
Fingers on slide four were helpful. Maybe you can help us understand I'm, a little bit what that translates to from a pre cancellation.
Year over year growth rate perspective in June and July so he can get a sense for some underlying growth. That's me sort of evaluate the the recovery and within that can you speak to any regions that are driving their coverage in any new types of consumer behavior or whether it's more domestic.
Travel a more adoption of alternative accommodation that you're seeing that's question. One second question. If you can just also talk about an update on the best day transaction. Thank you mentioned in the slide a second half 20 closing is that slightly pushed out from the third quarter that you read an expected and if there's any update on.
Sort of the financial profile year to date for best Dan and potential synergies as well.
[noise] [noise] sure and with regard to two gross bookings okay.
Well, we have seen in the quarter. That's out there that finished clearly when you actually do got reductions in gross bookings for the quarter. They are let's say two to minus 95% for argument sake and did it relative to last year. It clearly it over there you do have an impact of currency.
On certainly level of activity. It when you look odd number of transactions. Okay. The reduction has been smaller than that okay. And then they can indeed, the minus nine TV heavy in my mind is 95, okay. So there you can actually C.D., but I'm not only FX, okay, but at the same.
On time on on on the changing mix on the trial and given that it today. When you see the medium is traveling Q2, you actually got many people return it goes back to their two into the country of origin et cetera. So do whatever we don't like reorganization of the industry and with legal.
He actually going on so I think those are the two in don't do for the two factors two to two point.
With regard to a new trends consumer behavior et cetera. The way we are looking at disease.
Got it certainly looking out and that the recovery will first dog and Im looking at domestic try okay. The recovery will actually start with domestic truck.
And from that perspective that coupled with your question Larry Okay. We countries our pooling the current level of activity. The countries are actually helping the recovery that no. One was pointing before that actually from volumes very very low in April may then the plateauing at that point on actually now.
With a steady increase okay. When you see that Mexico, and Brazil. Both countries certainly are setting apart the level of activity be savvy other regions in like other countries in Latin America, where I can say countries, such as Argentina, Colombia, you see almost no flights whatsoever, given the kind of 11 of them.
He does everything is very much look down.
No.
On your mistake question, Okay, and we continue we're just waiting for the result of then.
Confessing ruling on that they trust capacity Dandruff Authority, Mexico, We also got filings in other geographies, particularly why.
As you might imagine the process.
And with the governmental agencies actually given the whole loans down in that environment, no doubt, you'll actually see on a lower speed that it's understandable under the current circumstances. They are a very.
Strong perspective.
And our level of participation the market given how optimize the market. He's okay doesn't represent in any issues and we actually look at a favorable outcome and when when when the authorities and actually [laughter] finalized or not.
Thanks, so much.
And ladies and gentlemen, as a reminder, if you like to ask your question. Please press Star then one.
Next question comes from Kevin Kopelman with Cowen and company. Please go ahead.
Hi, Good morning, and this is Emily Lavin on for Kevin. Thanks, a question.
I just wanted to follow up on your comment you answer the last question about the recovery starting with domestic travel.
How would you plan to positioning yourself to capture that demand and do you expect to domestic travel to increase I'm in the summer season in the southern Hemisphere.
And as a follow up what percentage of travel in Latin America is domestic versus international and normalized environment.
Thanks.
Hi, everybody. These dummy getting due to your question remember that study telling 30% of our revenues.
Our eyes and bookings are coming out of domestic travel.
We expect that to grow significantly and we are uniquely position in terms of ER inventory and relationship with the airlines hotels and other accommodations in our home region. If you want you see even that today. When you look at the market has are performing better like.
That makes it go on the Brasil we.
We are seeing it strong concentration of domestic bookings vis-a-vis he started trying to.
Remember also that even last year, we launch cities are like D D.
That were aiming capturing the opportunity so short term occasion, who called gateway and activities.
That are we at Bruce significantly irrelevant BW called the Mark is going to evolve.
Thank you.
Ladies and gentlemen, I was a final reminder, if you're going to ask a question. Please press Star then one at this time.
Pause momentarily the sort of anyone drugs.
And ladies and gentlemen, I'm showing no questions at this time, so let's turn the conference back over to them in school King for any final remarks.
Well. Thank you. Thank you all for joining US today, we look forward to see you and our next call if they stay safe.
Are you on your hobbies take care.
Right.
Thank you Sir This concludes todays conference call. We thank you all for attending today's presentation. You may now disconnect your lines have a wonderful day.