Travelport reports second quater 2015 results
LANGLEY, U.K., Aug. 4, 2015 /PRNewswire/ -- Travelport Worldwide Limited (NYSE: TVPT) announced today its financial results for the second quarter ended June 30, 2015.
· Strong Q2 financial performance with Adjusted Income per Share (diluted) of $0.29, up $0.43 year over year
· Net revenue up 1% to $554 million; 15% growth in Asia Pacific and RevPas up 4% to $6.00
Adjusted Free Cash Flow generation of $54 million, up $68 million
· Over 110 airlines participating in the world's leading merchandising solution within the indirect channel, Travelport Rich Content and Branding, enabling airlines to retail their entire product offering
· Beyond Air revenue up 12% to $122 million, being 23% of Travel Commerce Platform revenue (Q2 2014: 21%)
· eNett revenue growth of 27%; on target to achieve 50% reported revenue growth for the full year
· Hospitality segment attachment up 12% to 48 per 100 airline tickets issued
· Acquisition of MTT to accelerate Travelport's mobile growth strategy
Positive outlook for full year 2015
Gordon Wilson, President and CEO of Travelport, commented:
"Our strong second quarter performance means that we now expect full year earnings to be closer to the top end of our guidance ranges for 2015. Looking at the business, I am delighted that more and more airlines are turning to us for our industry-leading merchandising capabilities, including Rich Content and Branding which enables airlines to market their entire product suite and brand propositions through Travelport in the same way they do on their own websites and direct channels. We now have over 110 carriers signed to this solution, including, most recently, all of the Lufthansa Group airlines. To add further strength to our Platform, we completed the acquisition of MTT in July. Mobile travel commerce, in which MTT specializes, is at the forefront of the evolution of how travel is being consumed and, combined with the power, content and reach of our Travel Commerce Platform, will spearhead our growth strategy with an increased digital offering to the travel industry."
Discussion of Results for the Second Quarter of 2015
Unless otherwise stated, all comparisons are for the second quarter of 2015 compared to the second quarter of 2014.
Net Revenue and Adjusted EBITDA
Net revenue increased by $3 million, or 1%, to $554 million primarily due to growth in Travel Commerce Platform revenue of $4 million, or 1%. RevPas increased 4% to $6.00 driving a $15 million increase which was offset by lower volumes. International Reported Segments increased 1% driving $3 million of the increase, offset by an 8% decrease in U.S. Reported Segments, due to the impact of our 2014 renegotiated contract with Orbitz Worldwide, Inc. ("Orbitz Worldwide"), driving $14 million of the decrease. Overall, Total Reported Segments decreased 3% to 87 million.
Within Travel Commerce Platform revenue, a $14 million increase in Beyond Air revenue was partially offset by a $10 million decrease in Air revenue. The Air revenue decrease was mainly attributable to lower volumes from our 2014 renegotiated contract with Orbitz Worldwide and the European region, offset by growth in the Asia Pacific region. Beyond Air revenue increased 12% to $122 million primarily driven by continued growth in hospitality and payments. Technology Services revenue decreased marginally by $1 million due to the negative impact of our renegotiated Delta Air Lines hosting contract (effective July 1, 2014) being largely offset by growth elsewhere in IT solutions and application development services.
Adjusted EBITDA decreased by $9 million, or 6%, to $137 million. The decrease is primarily the result of lower volumes and increased expenses as we continue to grow our platform through acquisition, expansion of our go-to-market commercial capabilities and incremental public company administrative expenses.
Operating income increased by $3 million, or 4%, to $63 million primarily due to lower non-core corporate costs of $12 million (mainly unrealized gain on foreign currency derivative contracts) offset by decrease in Adjusted EBITDA of $9 million.
Net income increased by $11 million to $16 million primarily as a result of a $57 million decrease in interest expense and loss on early extinguishment of debt. This was due to the deleveraging, debt refinancing and IPO transactions completed in 2014, a $4 million improvement related to provision for income taxes and $3 million increase in operating income, offset by a $52 million decrease in gain in sale of shares of Orbitz Worldwide related to the transaction completed in 2014.
Adjusted Net Income (Loss)
Adjusted Net Income (Loss) increased by $44 million to $35 million.
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased by $62 million to $81 million primarily as a result of a $58 million decrease in interest payments.
Adjusted Free Cash Flow
Adjusted Free Cash Flow increased by $68 million, primarily as a result of changes in our net cash provided by operating activities.
Net Debt increased from $2,275 million at December 31, 2014 to $2,310 million at June 30, 2015, and is comprised of $2,459 million in total debt less $149 million in cash, cash equivalents and cash held as collateral.