Jesus Portillo: Yes. So Brett, let me clarify, when we are revising our guidance, we are retroactively assuming that we are excluding LBF from the beginning of the year. So basically, the new guidance we have given is not on a reported number, but on a pro forma number. So despite the divestiture during Q3, we are basically in the guidance, we are removing the net revenues of LBF during the first half of the year as well. So if you look at it from that perspective, LBF effectively last year had almost 40 million of net revenues. So if you make this adjustment, 210 million plus that is basically very much in line with the guidance that we provided in the previous quarter. And of course, we couldn’t have made that adjustment prior to completing that acquisition.
Therefore, this is just a mathematical calculation end point is not a change to our guidance. And then again, along similar lines, we are guiding on a performance of 25 million. So that’s basically the mathematical explanation to your question.
Q – Brett Knoblauch: I guess, through the first half of this year, the net revenue actually okay, that makes sense. And then maybe on the gross bookings to gross revenue, it looks like we’ve kind of change that methodology. I guess what has gone in that change?
Jesus Portillo: It’s just a definitional thing. I mean it’s basically a comment we received from our account, — our new accounts and your teams so the industry and the relevant term in PCAOB terms is gross bookings as opposed to gross revenue. So it’s not a change in the methodology, it’s just to change the label, which is in line with the PCAOB accounting rules.
Q – Brett Knoblauch: But that did result in some kind of corresponding changes to your historical numbers, if I’m comparing your
Orestes Fintiklis: No, no, no. On the methodology, no change.
Jesus Portillo: Methodology is exactly the same number would be exactly the same. We just changed the label. And as Orestes, is to be a little bit more consistent with methodology used in terms of terminology, no calculation by the industry.
Q – Brett Knoblauch: Okay. Got it. And then maybe just on the take rate and maybe transaction. I guess how should we think about transaction growth and kind of ARPT growth going into the fourth quarter and into next year, maybe on a pro forma basis?
Prasad Gundumogula: So I mean when you look at our transaction growth, it’s been quite strong, right when you pro forma for LBA, we’re talking about 47% — and we expect this growth to continue happening in terms of the take rate of that because some of these transactions are starting to be more linked to hotels and other type of non-air products — the take rate we expect, as I said before, to get into the double digits. But
Orestes Fintiklis: And Brett this is just on the ARPT question. I mean obviously, we’re seeing airfares come down, but we’re seeing hotel ADRs and that stayed up much better and that’s also an industry trend. So as Prasad mentioned, our mix continues to improve in those areas. And again, some of the recent additions to our portfolio of businesses is — are helping to provide more support on the transition — the move to the ancillaries and the hotel and other cruises, et cetera. So as that happens, then we’re seeing ARPT — it’s — there’s a decline because of the impact on the air side, but a lot of that’s made up. So that number is — it’s down a little bit, but not nearly as much as just is happening on the air side.
Jesus Portillo: Yes. And to add to that, I mean, we have seen the dynamic in the entire industry is a bit of a normalization after the post-pandemic boom. And on top of that, you have to factor the decline in air fares, right? So despite those two trends on a pro forma basis, we grew 66% of net revenue. This is basically extraordinary and is a result of increased market penetration and also this overperformance on the take rate which more than offset these two opposite dynamics in the industry, which underlines basically why our business model and our growth is sustainable going forward into the future.
Q – Brett Knoblauch: Got it. Appreciate it. Thank you guys.
Operator: Thank you. The next question today comes from the line of Mike Grondahl from Northland Securities. Please go ahead. Your line is now open.
Mike Grondahl : Hey, guys. Purplegrids that acquisition for 1.9 million shares, does it — what kind of revenue or adjusted EBITDA is it generating?
Orestes Fintiklis : Yes. So I’ll take that. Thank you, Mike, for your question. So the logic behind that acquisition is not in the short-term to either acquire EBITDA or revenue, but is to integrate a full AI platform into a travel solution, which is another pioneering step by Mondee. I mean effectively, Mondee travel company buying a generic full complete AI platform. Now the impact on the revenues and the cost in the short-term is going to be non-material because on the revenue side, it will take some time to basically implement clear monetization tools into AI. And like we mentioned, the objective of this acquisition is not only to enhance our front office integration of AI, but to effectively use this very powerful and leading platform to implement AI in all parts of our business, including the middle and the back office, including sales and marketing, and we’ll elaborate more on that in Q4.
Now on the cost side, even though we are taking a substantial number of highly skilled employees by acquiring this company, we have been working with them very closely for a long period of time. So effectively, on the cash flow side, we are substituting consulting fees with payroll fees. So overall, we believe it was not only a very cost-efficient solution, but it underscores our commitment to this AI-driven growth and our basically road map to implement AI in all parts of our business.
Mike Grondahl : Got it. And then with LBF the divestiture. I think I heard that you gave the original owner of 200,000 shares. But what was Hazus’ [ph] comment about $7.4 million of cash outflows. Could you just explain that?
Jesus Portillo : Yes. So I mean, the shares were the payment done from the acquiring in this case to Mondee, right? He happened to own Mondee’s stock. This was an acquisition that we did back in 2019. So that might be the confusion, right? So it’s not that Mondee, a stock of Mondee would received stock of Mondee one as part of the payment. So that’s number one. Also, as part of the agreement, we helped during the transition in primarily this Q3. As you know, we transitioned out the business. And that’s what we mentioned when we talk about around $7 million of cash related to that divestiture
Orestes Fintiklis : So Mike, just to clarify the sentence, we didn’t pay 200,000 shares. We received 200,000 shares. And we also agreed during the quarterly period to bear certain transition costs, which was a very big number, which basically validates our decision to dispose this business at this point in time. We mentioned that in the past, we try to restructure it. We try to resize it and it kept increasing actually the losses. And actually, the fact that the transition costs, which are basically coming to an end were so high validates again why it was so important to the profitability and also the new transformation of the business model, the transform the business model to dispose of this business unit.
