The New York-listed company expects revenues of US$760 million and adjusted EBITDA of US$170 million for this year.
Travel company Despegar has projected growth of more than 20% in bookings and revenue in Latin America in 2025 due to an improvement in Argentina, a stabilization of currencies in the region and expansion into Europe and the United States, CEO Damian Scokin told Reuters .
The company, which is considered the largest online tourism platform in Latin America - where it operates in 19 countries - has a growth target of 20% annually over the next five years, which it would exceed in 2025.
"In 2025 we have set a higher target of 20%, which includes the effect we expect from some things normalizing in Argentina and exchange rates stabilizing in the region. It also includes the effect of growing outside the region," Scokin said on Tuesday in a virtual interview with Reuters .
Despegar, which is listed on the New York Stock Exchange, expects revenues of US$760 million this year, with earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) of US$170 million.
"We are having a very, very good year in terms of results, which is reflected in the value of the stock and that opens up opportunities for us to finance and invest more," said Scokin.
The Argentina-based company reported third-quarter revenue of US$194 million, a year-on-year growth of 53%, while adjusted EBITDA reached a record US$48 million, 94% higher than in the same period in 2023.
"This year 2024 is challenging because the exchange rates in the region went against growth," Scokin explained before detailing the devaluations suffered by the currencies of Brazil and Mexico, of 16.7% and 18.5% respectively. Brazil represents 44% of its business, while Mexico is equivalent to 22%.
"These are huge devaluations for large economies, and that makes travel abroad more expensive in those countries, and that affects demand. Our goal for 2025 is for them to remain stable at those levels, and not get worse," the executive added.
Despegar will seek to expand into new markets in Europe and the United States through what it calls a B2B business, which is a partnership with other companies or banks "to offer travel through their loyalty programs."
Scokin explained that around 50% of tourism operations in Latin America are still carried out in person, so the company has opened physical stores in countries in the region, mostly in Brazil and Argentina, to meet that demand and plans to gradually open more.
In Mexico, Scokin said he is betting that the situation will improve after a second half of 2024 that was "quite bad due to the exchange rate."
On the other hand, in Argentina, where the economy has just suffered a deep recession with high inflation, demand is recovering but is still far from the country's normal levels, he explained.
The government of ultra-liberal President Javier Milei is seeking to deregulate the economy and eliminate currency restrictions in force in the country. On Monday, he announced that new airlines from Chile, Peru and the Dominican Republic will be able to operate international routes, expanding the air market in the southern nation.
Scokin said the measure would benefit consumers at a time when, according to the International Monetary Fund (IMF), "incipient signs" of recovery in the region's third-largest economy are beginning to be seen.
