Travelport Announces First Quarter 2009 Results
NEW YORK, May 8 /PRNewswire/ -- Travelport Limited, the parent company of the Travelport group of companies, today announced its financial results for the first quarter ended March 31, 2009.
First Quarter Summary:
- Net Revenue of $553 million and EBITDA of $119 million.
- Adjusted Net Revenue of $554 million and Adjusted EBITDA of $136 million, representing a (17)% and (21)% decrease as compared to the first quarter of 2008, respectively.
Travelport CEO and President, Jeff Clarke, stated: "The weak travel environment continues to be difficult for the entire travel industry. Travelport´s results reflect the impact of the continued global recessionary environment. GDS segments declined (16)% and GTA TTV declined (30)% year over year for the first quarter. While Travelport´s cost reduction initiatives have positioned the company to better withstand this downturn, we continue to expect 2009 to be a challenging year as our incremental year-over-year cost savings will not be sufficient to offset the weak demand for travel services. We continue to leverage our low cost base to fund investments and position the company to take advantage of the rebound in travel when it occurs. I am particularly pleased that the GDS business held margins throughout this difficult period."
Mike Rescoe, Travelport CFO, stated: "During the quarter, we realized $36 million of Worldspan synergies, an incremental $26 million as compared to the first quarter of 2008. We have now taken actions to achieve savings at or better than our target of $150 million in annual run rate cost savings and will exceed this target through additional actions in the coming quarters. In addition, in response to the current economic climate, the company has taken, and will continue to take, actions to further reduce and keep its cost base low while continuing to invest for the future. For the first quarter 2009, Travelport used $(9) million in cash from operations, an overall improvement of $42 million from the same period in 2008. The first quarter has traditionally been the seasonally weakest quarter for cash generation and Travelport ended the period with $268 million in cash and cash equivalents."
Financial Highlights First Quarter 2009
Net Revenue and EBITDA for our GDS business were $511 million and $152 million, respectively, for the first quarter of 2009. Adjusted Net Revenue and Adjusted EBITDA for our GDS business were $512 million and $161 million, respectively, for the first quarter of 2009. This resulted in a (14)% reduction in Adjusted Net Revenue and a (13)% reduction in Adjusted EBITDA compared to the first quarter of 2008. Lower revenue resulted from a (16)% decline in segments, offset by higher yield per segment compared to the first quarter of 2008. Agency inducements and commissions were $39 million lower, or 17%, compared to the first quarter of 2008. In addition, our GDS business reduced its operating expenses, excluding agency inducements and commissions, by $17 million, or 10%, compared to the first quarter of 2008.
Net Revenue and EBITDA for GTA were $42 million and $(11) million, respectively, for the first quarter of 2009. Adjusted Net Revenue and Adjusted EBITDA for GTA in the first quarter of 2009 were $42 million and $(10) million, respectively, representing a $(32) million decline in Adjusted Revenue and a $(19) million decrease in Adjusted EBITDA compared to the first quarter of 2008. Global Total Transaction Value ("TTV") declined (30)% in the quarter, driven by (19)% lower roomnights and a (13)% reduction in average daily rates. Operating expenses for GTA decreased $9 million, or (16)%, during the first quarter of 2009 driven by currency changes and other cost saving initiatives.