Amadeus first quarter results show strong organic growth reinforced by contribution of recent acquisitions
Amadeus reports year-on-year financial and operating results for the first quarter of 2014. Adjusted profit for the period grew 8.6% to €191.3 million. Comparable growth, excluding the impact fromrecent acquisitions, was 7.7%.
Q1 highlights (three months ended March 31, 2014)
■ Revenue increased 9.1%, to €867.6 million. Excluding the acquisitions of Newmarket International and UFIS, comparable growth stood at 7.4%.
■ EBITDA grew 8.7%, to €351.4 million. Excluding acquisitions, comparable growth reached 7.4%.
■ In the Distribution business, total air travel agency bookings increased 5.3%, outperforming the industry and registering strong growth in North America (+17.6%).
■ In the IT Solutions business, Passengers Boarded increased 15.8%, to 152.5 million, fueled by strong growth in Asia Pacific (+85.2%).
May, 8: Amadeus IT Holding, S.A., a leading technology partner for the global travel industry, reports year-on-year financial and operating results for the first quarter of 2014 (three months ended March 31, 2014).Adjusted profit for the period grew 8.6% to €191.3 million. Comparable growth, excluding the impact fromrecent acquisitions, was 7.7%. This was backed by an increase in revenue of 9.1%, to €867.6 million, and8.7% growth in EBITDA, to €351.4 million.
Luis Maroto, President & CEO of Amadeus, commented:
“Amadeus has maintained its record of delivering strong organic growth in its core businesses, Distribution andAirline IT Solutions. The joint contract with Southwest Airlines to implement the Amadeus’ Altea reservationssolution as the carrier’s only reservation system is a truly landmark IT partnership for Amadeus. Southwest willbecome our largest airline IT partner worldwide by passengers boarded. “This organic growth is now also reinforced by the positive contribution of our recent acquisitions. Ourcommitment to our stated ambition in Hotel IT, to build a community model for the hotel industry, has beenevidenced by the Newmarket International acquisition and the recently signed partnership with InterContinentalHotels Group (IHG) to develop technology solutions to enhance the guest experience.
“We have also made significant progress in the Airport IT segment. The addition of UFIS’ airport solutionsportfolio enables Amadeus to accelerate its product development plan and to become a leader in this sector.
“These results clearly prove that Amadeus is fully equipped to continue to deliver on its strategy, backed by itsfinancial strengths and technology expertise.”
Consolidated net financial debt stood at €1,534.3 million, as of March 31, 2014 (based on covenants’ definitionin senior credit agreement), representing 1.22x the ratio of covenant net debt to the last twelve months’covenant EBITDA. During the period Amadeus paid an interim dividend of €133.4 million in respect of the 2013profit.
■ Revenue increased 6.5%, to €651.7 million
■ Air travel agency bookings rose 5.3%, to 125.5 million
■ Market share expanded by 0.1 percentage points, reaching 39.9%
Even as industry growth picked up pace when compared to the first quarter of 20131, Amadeus continued tooutperform its peers. The increase in air travel agency bookings was fueled by a 17.6% rise in North America,the positive impact of industry recovery in Western Europe, and the strong growth in the Middle East andAfrica (+11.4%), which were negatively impacted by political instability in 2013.
During the first quarter, content agreements were signed and extended with 16 airlines including UnitedAirlines, while distribution agreements were signed with four new low-cost airlines and hybrid carriers whichcontinue to be an area of growth for Amadeus. Low-cost carriers’ travel agency bookings increased 11%compared to the same period of 2013.
On the travel agency side, Amadeus signed a new multi-year agreement with the leading global online travelcompany OrbitzWorlwide. Under this agreement, Amadeus will deliver its technology and global distributionsystem services to support the Orbitz brands in North America from January 2015.
■ Revenue grew by 18%, to €215.9 million. Excluding Newmarket International and UFIS, revenue was of 202.3 million, a 10.6% increase.
■ Passengers Boarded strengthened 15.8% to total 152.5 million
■ The shift towards Asia Pacific in the Airline IT business will continue as further migrations are scheduled
Airline IT: Asia & Pacific remained the strongest growth region, with an 85.2% increase in passengersboarded, driven by the contribution of Asian airlines added to our Altéa platform over the past 12 months,including Thai Airways. This shift towards Asia will continue as further migrations are scheduled, includingKorean Air in 2014 and All Nippon Airways –international passengers business – in 2015.
Hotel IT: During the first quarter, Amadeus completed the acquisition of US-based Newmarket
International for USD 500 million. Newmarket International, which serves around 22,000 unique properties in154 countries, operates in the group and event management segment of the hotel industry, which is estimatedto account for 30-40% of a full-service hotel’s revenues. The newly acquired company will be operated as astand-alone business within Amadeus’ Global Hotel Group and will integrate several Amadeus products andservices over time.
By the end of the quarter we have also announced the strategic technology relationship signed withInterContinental Hotels Group. The combination of IHG’s industry insight and expertise with Amadeus’technology capabilities and broad travel experience will ensure that IHG continues to offer the most innovativeand efficient technology solutions at all stages of the Guest Journey.
Airport IT: Amadeus continued its expansion into the Airport IT space with the acquisition of UFIS, a leadinginformation technology player which brings a complementary suite of airport technology solutions as well as aset of important customer relationships worldwide. Amadeus also launched Amadeus Airport Common UseService (ACUS), a next-generation platform capable of carrying out all passenger processing functions.During the quarter, Amadeus has signed 7 new ground handlers increasing the total figure to 62. Amadeus hastoday the leading portfolio of ground handlers signed to its Departure Control System across all continents.