The UKs leading online retailer of beach holidaysH118 Results Presentation – May 2018

Agenda

2

Evolution of Key Drivers Summary and Outlook

Simon CooperCEO

Financial Performance H118Paul MeehanCFO

H118 Highlights and Market DynamicsPaul MeehanCFO

Q and A

Cautionary statement

This presentation may contain certain forward-looking statements with respect to the financial condition, results, operations and businesses of the Company. Forward looking statements are sometimes, but not always, identified by their use of a date in the future or such words as ‘anticipates’, ‘aims’, ‘due’, ‘will’, ‘could’, ‘may’, ‘should’, ‘expects’, ‘believes’, ‘intends’, ‘plans’, ‘targets’, ‘goal’ or ‘estimates’. These forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements, including factors outside the Company's control. The forward-looking statements reflect the knowledge and information available at the date of preparation of this presentation and will not be updated during the year. Nothing in this presentation should be construed as a profit forecast

H118 Highlights

24% YOY increase in daily unique visitors to site with incremental investment to grow Sunshine share Flight supply constriction post Monarch collapse drove YOY increase in winter seat pricing Incremental capacity now available is alleviating seat constriction

3

19% increase in UK Revenue after marketing to £23.0m (H117: £19.4m) with increased offline spendYOY at end of period

Direct contracting averaged 68% of all hotel buying (H117: 66%) with 30% of hotels exclusive

Leverage £ Revenue

Continued investment into IT function is increasing the pace of innovation

16% increase YOY in logged in sessions to 5.8m sessions (H117: 5.0m)

61% of all visits to site on smartphone (H117: 53%)

PersonaliseCustomer

Proposition

Structural Market Growth & Market

Share Growth

15% growth in Adjusted Profit before tax to £14.0m (H117: £12.2m)

50% growth in H1 International Revenue with Denmark launching May 2018

Board continuing to review options for value enhancing acquisition opportunities

Drive Operational Leverage & Expand

Internationally

Online marketing spend of 40.5% of revenue despite incremental investment in Sunshine.co.uk

Offline investment supporting strengthening brand awareness

62% of traffic to site from brand and direct sources (H117: 57%)

Drive Efficient Share Growth &

Strengthen Brand

OTB continues to disrupt the retailing of beach holidays through innovative technology and value proposition

H118 Market DynamicsThe failure of Monarch airlines led to a supply / demand imbalance that has improved throughout H1

4

YOY booking growth and seat prices for Oct – March travel Monarch failed on the 2/10/17

As shown in the chart opposite, the lack of seats in the market for winter departures led to a significant increase in the price for these seats

‒ Where incremental capacity was scheduled to replace the Monarch programme this was for departures post April 1st

‒ This effect was more profound where Monarch had a high share of seats on a route

The impact of this in H1 18 is estimated as £1.1m

Across the period that followed Monarch’s collapse incremental capacity was scheduled covering most of the seats that were lost

Seat price inflation for summer departures has been less noticeable‒ Seat prices for summer departures are approx. +10% YOY

Hotel prices fairly flat YOY (modest inflationary increase)

YOY seat prices for April – October travel

(20.0%)

(10.0%)

-

10.0%

20.0%

30.0%

40.0%

Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

(30.0%)

(20.0%)

(10.0%)

-

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Bookings YOY Seat price YOY %

Monarch collapse

Profit and Loss Account – UK SegmentH118 EBITDA growth +17%

UK growth year on year

Revenue +18%

Revenue after marketing +19%

EBITDA +17%

Efficient increase in share of traffic with marketing spend excluding off-line maintained at 40.5%

17.2% increase in Offline Marketing spend to further drive brand awareness. Incremental spend at end of H1 £0.5m expected to pay-back in H2

Overhead % increase includes Sunshine

EBITDA % revenue at 38.3% despite the acquisition of Sunshine.co.uk which was dilutive at 33% EBITDA % pre-acquisition

P&L UK SegmentSix months ended 31 March (£m) H1 FY18 H1 FY17 Change %

Revenue 44.4 37.5 18%

Marketing costs excluding offl ine (18.0) (15.2)Offl ine (3.4) (2.9)Total Marketing (21.4) (18.1)- % of Revenue 48.2% 48.3%- % of Revenue (excluding offl ine) 40.5% 40.5%

Revenue after marketing costs 23.0 19.4 19%Variable costs (2.4) (2.0)Overhead costs (3.6) (2.9)EBITDA 17.0 14.5 17%- % of Revenue 38.3% 38.7%

Daily unique visitors '000 34,100 27,500 24%Variable cost % Revenue 5.3% 5.3%Overhead cost % Revenue 8.1% 7.7%Total costs % of Revenue 13.4% 13.0%

Revenue increased by 50% to £0.9m driven by growth in both Sweden and Norway

OTB continues to invest both online and off-line to grow market share

Denmark launching May 2018

Profit and Loss Account – InternationalH118 Revenue growth +50% - Investment continues in Sweden to build scale and brand

P&L International SegmentSix months ended 31 March (£m) H1 FY18 H1 FY17 Change %

Revenue 0.9 0.6 50%

Marketing costs excluding offl ine (1.5) (1.1)Offl ine (0.6) (0.4)Total Marketing (2.1) (1.5)

Revenue after marketing costs (1.2) (0.9)Overhead costs (0.4) (0.1)EBITDA (1.6) (1.0)

Profit and Loss Account – GroupAdjusted profit before tax +15% increase YOY

Adjusted profit before tax increased by 15% to £14.0m

Adjusted profit after tax increased by 15% to £11.1m

Adjusted EPS increased by 15% to 8.5p

P&L TotalSix months ended 31 March (£m) H1 FY18 H1 FY17 Change %

EBITDA UK segment excluding share based payments 17.0 14.5 17%EBITDA International segment (1.6) (1.0)Group EBITDA excluding share based payments 15.4 13.5 14%Depreciation and amortisation (1.5) (1.2)EBIT excluding share based payments 13.9 12.3 13%Finance costs / Other Income 0.1 (0.1)Adjusted Profit Before Tax 14.0 12.2 15%Corporation Tax (2.8) (2.5)Adjusted Profit after Tax 11.2 9.7 15%Non-underlying costs (0.2) -Share Based payments (0.6) (0.2)Amortisation of acquired intangibles (2.2) (2.1)Deferred tax on amortisation of acquired intangibles 0.3 0.4Retained Earnings 8.5 7.8 9%

Earnings per ShareBasic 6.5 6.0 8%Adjusted 8.6 7.5 15%

Dividend per Share (pence) 1.1 0.9 22%Effective tax rate 20.0% 20.5%

Working capital movement relates to the seasonality of the business with c.50% of bookings travelling between June and August when Trust cash unwinds

YOY operating cash flow £(12.7)m due to an increase in working capital requirements:

Increase in bookings & low deposit funding

Trust timing differences due to Easter weekend

£3m deferred consideration re acquisition of Sunshine.co.uk paid in the period (£12m total)

Cash Flow

Cash flowH1 FY18 H1 FY17

Opening Cash Balance Total 71.6 51.7Opening Cash Balance Trust 38.5 25.6Opening Cash Balance excluding Trust balance 33.0 26.1

EBITDA excluding share based payments 15.4 13.5Increase in working capital (28.7) (11.8)Movement in Trust balance (19.9) (23.0)Purchase of plant and equipment (0.8) (0.4)Capitalised Development Expenditure (1.7) (1.3)Operating Cash Flow (35.7) (23.0)Operating cash/EBITDA (232%) (170%)Corporation tax (3.3) (2.5)Non-underlying costs (0.3) -Acquisition of subsidiary (3.0) -Interest 0.1 -Dividends paid (2.5) (2.9)Net decrease in cash excluding trust account (44.7) (28.4)

Closing Cash excluding Trust account (11.7) (2.3)Closing Trust account balance 58.4 48.6Closing Cash balance Total 46.7 46.3

All customer monies are paid into a trust account which is effectively a debtor to the business

Seasonal cash flow requirements are covered by a revolving credit facility which is drawn down as required

Net debt has increased from £2.3m to £11.7m

Balance sheet

Balance SheetH1 FY18 H1 FY17

Tangible Assets 2.0 0.9Intangible Assets - IT development 4.4 3.6Intangible Assets - Acquired Intangibles 34.8 37.7Intangible Assets - Goodwill 31.6 21.5Total Fixed Assets 72.8 63.7Trade and other receivables 156.9 111.8Trust Account 58.4 48.6Cash - -Total Current Assets 215.3 160.4Trade and other payables (164.4) (123.2)Corporation tax payable (1.7) (3.7)Derivative Financial Instruments (0.9) (1.0)Total current liabilities (167.0) (127.9)NET CURRENT ASSETS 48.3 32.5Bank facil ity (11.7) (2.3)Deferred Taxation (6.1) (6.6)Net assets 103.3 87.3

Net Debt (11.7) (2.3)Net Trade Drs/Crs (7.5) (11.4)

£0.0

£5.0

£10.0

£15.0

£20.0

H113 H114 H115 H116 H117 H1180.0%

5.0%

10.0%

15.0%

20.0%

25.0%

H113 H114 H115 H116 H117 H118

£0.0

£5.0

£10.0

£15.0

£20.0

H113 H114 H115 H116 H117 H118£0.0

£10.0

£20.0

£30.0

£40.0

£50.0

H113 H114 H115 H116 H117 H118

£0.00

£0.50

£1.00

£1.50

H113 H114 H115 H116 H117 H1180

50001000015000200002500030000

H113 H114 H115 H116 H117 H118

UK KPIs: H113 to H118Revenue per Daily Unique Visitor (£)

Revenue (£m)

Traffic Growth ( ‘000 Daily Unique Visitors)

10

Revenue after Marketing Spend (£m)

Fixed and Variable costs as a % of Revenue EBITDA (£m)

Key Drivers of Growth

Innovate through investment in talent & technologyContinued investment into in-house technology extends our ability to out innovate the competition

12

Technology platform Retention – we have implemented reward schemes to our teams are incentivised for the long term

Recruitment – The business will be moving to a new digital HQ to support a

drive to double the size of the digital function in the next 3-5 years

‒ Our contact centre specialists will remain in our current office in Cheadle

‒ We continue to grow our technology team via a twice annual Ruby Academy

Reorganisation – of our modular platform architecture and our reporting lines to allow for greater team scalability

Our working methodologies are becoming increasingly agile

We continue to build innovative new features to benefit our customers

Personalise Customer PropositionOur ambition is to drive a fully personalised cross-device experience for all users on all devices

13

Revenue per booking

Conversion Revenue per unique visitor

Continued innovation‒ Rebuilt deals engine powers new destination agnostic search

functionality‒ Full site rollout in H2 18‒ Supports opaque pricing and long haul proposition

Enhanced split test capability drives improvements to revenue per UV‒ Large volumes of traffic required to reach statistical

significance‒ Supported by continued improvements to agile working

methodologies

Continued improvements to personalisation technology and login‒ 16% growth in logged in users with increased levels of

engagement and conversion‒ Probabilistic matching drives virtual login‒ Data management platform integration ensures better first

time personalisation

Split testing

Deals functionality

0.0%10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%90.0%

Jan-

14Ap

r-14

Jul-1

4O

ct-1

4Ja

n-15

Apr-

15Ju

l-15

Oct

-15

Jan-

16Ap

r-16

Jul-1

6O

ct-1

6Ja

n-17

Apr-

17Ju

l-17

Oct

-17

Jan-

18Ap

r-18

Jul-1

8O

ct-1

8Ja

n-19

Leverage Direct & Differentiated Supply Driving an increasing % of exclusivity continues to present a huge margin / volume opportunity

Investment made to scale our supply function‒ Scale and disintermediation drives margin growth

Direct contracting function performed in line with expectations‒ 68% of hotels directly contracted, driving >50% of Group

revenues

‒ 140% increase in sales to Turkey with slightly lower % directly contracted

‒ 500%+ increase in long haul sales

FY17–FY18 use differentiated supply to drive volume and market share gains

FY19-FY20 convert differentiated supply position into incremental margin

14

Hotel contracting: Incremental margin / volume opportunity

HIG

H

Volu

me

/ M

argi

n O

ppor

tuni

ty

UK rate exclusivity

Standard direct contract

3rd party provided long tail

UK OTAexclusivity

30%

38%

32%

% H118 sales

Direct contracting - share of monthly arrivals

70%

0

20000

40000

60000

80000

100000

H113 H114 H115 H116 H117 H118

Drive an Efficient Increase in ShareWe continue to invest in proprietary tools to allow us to grow traffic share efficiently

Multi-channel strategy supported by attributed in house bid modelling allows efficient share growth

Efficiencies in online spend allow for increased investment offline

‒ Offline spend phasing in H118 different to H117 with a higher proportion of spend later in period

‒ Supported by in house econometric modelling tool

Brand share of traffic continues to increase

Repeat purchase volume and rates continue to increase and complaint ratios continue to fall

Econometric Modelling

15

Repeat booking volumes and %Repeat as % of

all bookings 26.9% 31.6%30.0% 35.8% 40.3% 42.9%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

H113 H114 H115 H116 H117 H118

16

OTB vs Tour Operators £ Fixed / Variable CPB

We are ready for legislative changes in July 2018 whilst maintaining our lightweight cost base

Drive Operational Leverage

OTB Fixed / Variable costs as % Revenue

OTB fixed and variable cost per booking is well below tour operator competitors

OTB fixed and variable costs as a % of revenue have consistently reduced through operational leverage

‒ Scalable model supports further leverage of a low fixed cost base

Incremental investment made in H118 following integration of sunshine.co.uk and in readiness for PTD implementation in July 2018

‒ With majority of own product directly contracted, strong customer service and feedback functions and 24/7 in resort support OTB is well placed to support sale of package product cost effectively post implementation of Package Travel Directive in July 2018

0

50

100

150

200

250

OTB TUI TC

7X OTB

8X OTB

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

Apr-

15

Jun-

15

Aug-

15

Oct

-15

Dec-

15

Feb-

16

Apr-

16

Jun-

16

Aug-

16

Oct

-16

Dec-

16

Feb-

17

Apr-

17

Jun-

17

Aug-

17

Oct

-17

Dec-

17

Feb-

18

Apr-

18

Expand Model into New Source Markets

17

We remain encouraged with the improvement to KPIs being achieved in Sweden

Scandinavia has a number of characteristics which made it attractive for international expansion

Driving improvement in 3 KPIs will determine success in new source markets− Cost per click, conversion and branded share− Branded share is key as it reduces cost per click and improves

conversion

Our objective in new source markets remains to reach a positive return within 3 full years of launch

50% revenue growth in international markets in H118− Repeat purchase rate continues to strengthen− Investment in H1 increased to support growth

Performance in Sweden gives us confidence to launch our 3rd

market, Denmark in 2018 having launched Norway in FY17

Repeat purchase rate monthly Sweden FY15 – H118

18

Opportunities exist to add significant value through acquisition

Evaluate acquisition opportunities

Complementary OTA

Like for like OTA

As core UK plus:

‒ Remove execution risk

‒ Acquire trusted brand

‒ Accelerate international expansion

As Like for Like OTA plus:

‒ Remove execution risk

‒ Expand product offering / expertise

‒ Broaden addressable market

Core - UK International - Expansion

Leverage OTB technology to personalise customer proposition

‒ Drive conversion

Leverage OTB direct supply position‒ Drive revenue growth

Consolidate market

Rapidly increase traffic and passenger numbers‒ Volumes support differentiated supply

Leverage OTB bidding capability‒ Increase share of voice

Leverage OTB cost base

Summary

19

We have delivered a strong performance in H118 and invested for growth in H2

Driving increased % of direct and exclusive supplyLeverage £ Revenue

Out innovating through agility and investment in talent and technologyPersonaliseCustomer

Proposition

Building share of a growing addressable market with increasing efficiencyStructural Market Growth & Market

Share Growth

Driving PBT growth in the UK and expanding model into new source markets and productsDrive Operational

Leverage & Expand Internationally

Strengthening OTB brand and repeat purchase Exploring further value-enhancing acquisition opportunities

Drive Efficient Share Growth &

Strengthen Brand

Appendix

0

200000

400000

600000

800000

1000000

1200000

1400000

1600000

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Passenger numbers

2007250,000 passengersFirst round private equity

2009-11Technology team recruited, complete platform rebuild

2005-6First version website, paid search

2004Excess charter supplyGrowing online penetration

2008-10Executive and senior management team recruited

End 2011Tech and MI platforms relaunched

2013-14Investment into offline advertising and direct contracting

20132nd round private equity

2015Ebeach.se launchedIPO

2016Launched drive to contract exclusive product

Online share of short haul beach

9%

16%

17%

14%

13%

OTB history

21

18%

21%

Business Model

£ Revenue per booking

Conversion

Unique visitors

Revenue per unique visitor

OTB share of market traffic

Online penetration

Revenue

Marketing investment

PBT

Fixed and Variable Costs

Unique visitorsMarketing spend per

unique visitor

Short haul beach holidays dynamically

packaged

PERSONALISE CUSTOMER PROPOSITION & LEVERAGE £ REVENUE

DRIVE EFFICIENT SHARE GROWTH & STRENGTHEN BRAND

STRUCTURAL MARKET GROWTH & MARKET SHARE GROWTH

SCALE DRIVES OPERATIONAL LEVERAGE

ADDRESSABLE MARKET

22

OTB’s business model is centred on driving efficient growth in market share while maintaining and improving both conversion and £ revenue per booking

Our strategic initiatives are focused on driving the performance of all of these levers

EBITDA growth is the cumulative effect of improvements in performance of all of the levers individually

On the Beach has the product advantages of a tour operator with the model advantages of an OTA

23

Disruptive retailer of beach package holidays

Cost Base

Risk

Margin

Product Range

HIGH

HIGH

HIGH

NARROW

LOW

LOW

LOW

BROAD

Tour Operator OTA

Specialist Generalist

On the Beach sells high margin tour operator style product with a lightweight OTA style fixed cost base

Barriers to Success

Tour operator short haul volumes (m pax)UK Short Haul Beach Package Online1

FOCUS SCALEAGILITYEXPERTISE BRAND

24

JET20

1

2

3

4

5

6

7

8

9

10

2008 2009 2010 2011 2012 2013 2014 2015 2016

Note 1: Of all of the holidaymakers travelling to beach holiday destinations from the UK each year approximately 60% book a package / dynamic package. Of those booking package / dynamic package approximately 75% are travelling to short haul destinations (within 6 hours flight time) and approximately 50% of these holidaymakers are booking their holidays online

TUI

Thomas Cook

Jet2holidays

Monarch Holidays

Olympic Holidays

On the Beach / Sunshine

Travel Republic

Low Cost Holidays

Love Holidays

Easyjet Holidays

Other OTA

Other tour operator

Market - Europe

25

Similar trends in Europe to the core UK market represent an attractive expansion opportunity for OTB

Western European package holiday market (€bn)

Share of European Leisure Package Holiday market

TUI

ThomasCook

Kuoni

Other

Online penetration in Europe is low but growing at a faster rate than the UK

Low cost carriers continue to expand their fleets

The market is dominated by tour operators who held a stranglehold over seat supply

The key drivers of success in new source markets will be:− Driving non-branded traffic cost effectively− Optimising local market proposition to drive conversion− Strengthening branded share of traffic

Our objective is to reach scale and deliver a positive return in each new market in a finite time period

2.0 1.4

7.7

16.5

11.4

4.2

1.0

8.0

2.3

0%10%20%30%40%50%60%70%80%90%

0.00

5.00

10.00

15.00

20.00€bn TTV Online Penetration Rate

Cash Flow – Flow of funds On The Beach provides clear and comprehensive consumer protection

Trust account – funds flow for a £1,300 holiday The trust account is designed to ensure all

customer payments are protected until after the provision of holiday services

The trust account is governed by a deed which determines the inflows and outflows from the account

All customer receipts are paid into the trust account in full before the holiday departure

These payments are held in the trust account until the service is provided

On The Beach does not use customer pre-payments to fund its business operations

Customer Pays low Deposit

£222

£550 Flights

Customer returns

from holiday

£700 Hotel

Receive full

balance 14 days before

departure£750

Hotel and ancillary supplier

paid£560 + £26

ATOL Trust Fund (Protected)

Checkoutstage

Immediately after booking

Holiday build up

Return date

CUSTOMER£1,300

SUPPLIER

Transfer to OTB of flight

on receipt into trust

from customer

£222

Transfer to On the Beach of

balance of sales £750

Airline paid in full by OTB on booking

£539

Booking stage

£50 Coach

Transfer

Receive flight

balance 28 days

post booking

£328

Transfer to OTB of flight

on receipt into trust

from customer

£328

OTB £MPB£175

26

Cash Flow - SeasonalityPeak booking trading period between January and June and travelled June and August

Booked by month Revenue recognised on a booked basis

Calendar Q4 is quiet

Traffic volumes increase following Christmas as customers start to research for the following summer

Travelled by month Peak departure months are July and August

Funds Flow Invest in marketing and low deposits to drive bookings but

margin and cash are earned on a travelled basis

27

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

% FY17 Booked by Month

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

% FY17 Travelled by Month

Cash Flow: Cash ProfileFacility used to fund low deposits during peak trading periods between January and June

Annual cash cycle sees investment into working capital as bookings are achieved in Jan - June, with cash unwinding from the trust as customers travel

RCF facility renegotiated in May 17. The maximum facility available was £35m, maximum drawdown was £22m (2016: £13.5m)

28

(20)

(15)

(10)

(5)

-09/16 10/16 11/16 12/16 01/17 02/17 03/17 04/17 05/17 06/17 07/17 08/17 09/17

Mill

ions

Funding of Low Deposits FY17

-30

-20

-10

-

10

20

30

10/2016 11/2016 12/2016 01/2017 02/2017 03/2017 04/2017 05/2017 06/2017 07/2017 08/2017 09/2017

Mill

ions

Bank Balance Profile FY17