NEW YORK, May 6, 2010 -- Travelport Limited, the parent company of the Travelport group of companies, today announced its financial results for the first quarter ended March 31, 2010.
First Quarter 2010 Summary:
Net Revenue of $581 million, a 5% increase over first quarter 2009
Operating Income of $60 million, a 5% increase over first quarter 2009
Adjusted EBITDA of $139 million, a 2% increase over first quarter 2009.
Commenting on the performance for the period, Travelport CEO and president, Jeff Clarke, stated: "I am pleased with Travelport´s performance in the quarter. We made key strategic investments while delivering a 5% increase in Net Revenue and 9% growth in Adjusted EBITDA, on a constant currency basis, compared to the first quarter of 2009. Our transaction volumes continued the recovery that began in the final quarter of 2009, and despite recent travel disruptions caused by the volcanic ash cloud, we are confident that we are on track to achieve our previous expectations for revenue and profits for the full year 2010."
Financial Highlights First Quarter 2010
GDS($ in millions)
Net Revenue and Segment EBITDA for the GDS business were $536 million and $151 million, respectively, for the first quarter of 2010, representing a 5% increase in Net Revenue and a decrease of 1% in Segment EBITDA compared to the first quarter of 2009. Segment Adjusted EBITDA for our GDS business was $153 million for the first quarter of 2010, a 5% reduction as compared to the first quarter of 2009. Increased Net Revenue resulted from a 6% increase in segments as compared to the first quarter of 2009, a 1% increase in average revenue per segment and a $5 million reduction in Airline IT Solutions revenue. GDS direct costs, comprising agency commissions, increased $33 million, or 17%, as a result of the increase in segments, an increase in the average rate of agency commissions and unfavorable movements in foreign exchange rates. Operating expenses for GDS, excluding agency commissions, remained flat compared to the first quarter of 2009.
GTA($ in millions)
Net Revenue and Segment EBITDA for the GTA business were $45 million and $(2) million, respectively, for the first quarter of 2010. Segment Adjusted EBITDA for GTA for the first quarter of 2010 was $(3) million, representing a $7 million improvement compared to the first quarter of 2009. Total Transaction Value ("TTV") increased 19% in the quarter primarily due to 10% growth in the number of room nights and favorable exchange rate movements. Net Revenue increased 7% in the quarter due to the increase in TTV, partially offset by lower margin on sales. GTA direct costs, comprising transactions where GTA takes inventory risk, remained flat at $3 million. Operating expenses for GTA decreased $4 million, or 9%, compared to the first quarter of 2009 primarily due to a reduction in bad debt expense.
Corporate
Travelport incurred adjusted corporate costs, which exclude the impact of certain non-recurring items, of $11 million for the first quarter of 2010, $4 million less than the first quarter of 2009.
During the quarter, Travelport used $27 million in cash for operations, an $18 million increase over the same period in 2009. This increase is attributable to fluctuations in our collection cycle and trading volumes. During the quarter, Travelport used $169 million for investment, including $50 million for newly-issued common shares of Orbitz Worldwide and $114 million in cash to fund fixed assets additions, including software and equipment acquired under a material modification to our agreement with IBM. The investments were funded in part through $100 million borrowed under our revolving credit facility.
Travelport´s net debt at March 31, 2010 was $3,596 million, which comprised debt of $3,703 million less $107 million in cash and cash equivalents.
Orbitz Worldwide
Travelport Limited currently owns approximately 48% of the outstanding equity of Orbitz Worldwide. Travelport accounts for its investment in Orbitz Worldwide under the equity method of accounting. During the first quarter of 2010, Travelport recorded $3 million in losses from its investment in Orbitz Worldwide.
About Travelport
Travelport is a broad-based business services company and a leading provider of critical transaction processing solutions to companies operating in the global travel industry. Travelport is comprised of the global distribution system (GDS) business that includes the Worldspan and Galileo brands; GTA, a leading global, multi-channel provider of hotel and ground services and Airline IT Solutions, which hosts mission critical applications and provides business and data analysis solutions for major airlines. With 2009 revenues of $2.2 billion, Travelport operates in 160 countries and has approximately 5,400 employees.
Travelport also owns approximately 48% of Orbitz Worldwide (NYSE: OWW), a leading global online travel company. Travelport is a private company owned by The Blackstone Group, One Equity Partners, Technology Crossover Ventures and Travelport management.
