Amadeus IT Group, a Spanish IT provider for travel and tourism industry, reported Tuesday that its first-quarter profit fell 60.5 percent to 117.8 million euros from last year's 298.5 million euros.
“During the first quarter of 2020 and as the COVID-19 pandemic progressively advanced into more regions, we saw its impact on global air traffic and on our volumes increase. At the beginning of the quarter, over the month of January, we had strong operating and financial performance across our businesses. However, from mid-February, our travel agency air bookings, which reflect forward air traffic, were being most impacted and started to point to effects beyond Asia. These effects grew in March to reach a worldwide scale. ”
Highlights for the first three months ended March 31, 2020
* In Distribution, our travel agency air bookings decreased by 47.7%, to 85.0 million.
* In IT Solutions, our passengers boarded declined 12.0%, to 383.9 million.
* Revenue contracted by 27.3%, to €1,021.7 million.
* EBITDA decreased by 41.3%, to €349.4 million.
* Adjusted profit1 contracted by 57.5%, to €141.8 million.
* Free Cash Flow2 was €289.8 million, increasing 3.0%.
Adjusted profit was 141.8 million euros, compared to 333.8 million euros a year ago. Adjusted earnings per share were 0.33 euros, compared to last year's 0.77 euros.
EBITDA decreased 41.3 percent to 349.4 million euros from last year's 595.6 million euros.
Revenue fell 27.3 percent to 1.02 billion euros from prior year's 1.41 billion euros. Distribution revenue plunged 45.5 percent, while IT Solutions revenue edged down 0.3 percent.
In the first quarter of 2020, the travel agency air booking industry contracted 46.4 percent as the COVID-19 pandemic caused booking volumes to decline at a strong double-digit rate in all regions.
The company announced a €300 million cost-cutting program in March, alongside securing a €1 billion financial package on top of its existing €1 billion “revolving credit facility”. It has €660 million in cash reserves.
Luis Maroto, President & CEO of Amadeus, said, "We are closely monitoring the situation with the COVID-19 pandemic and will adapt our response to it as needed. We are confident in the resilience of the travel sector and in the underlying strength of our company, but the coming months will remain challenging for the whole sector."