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Travelport Worldwide Limited Reports Third Quarter 2016 Results

November 7, 2016 Financial No Comments Print Print Email Email

Travelport Worldwide Limited (NYSE: TVPT) announces its financial results for the third quarter ended September 30, 2016.http://www.dreamhotels.com/default-en.html

Key Points

  • Net revenue increased 6% to $591 million
  • Operating income of $62 million, net income of $21 million and net cash provided by operating activities of $111 million
  • Air revenue increased 2% to $408 million; Beyond Air revenue growth of 18% to $152 million, contributing 27% of Travel Commerce Platform revenue (Q3 2015: 24%)
  • International revenue increased 9% driven by growth in both Reported Segments and RevPas, with double-digit revenue growth in Europe (14%) and Asia Pacific (10%)
  • eNett net revenue increased 60% to $42 million
  • Adjusted EBITDA increased 15% to $150 million driven by business performance and favorable foreign exchange movements
  • Adjusted Free Cash Flow generation of $83 million, an increase of $52 million
  • Voluntary prepayment made for $50 million of term loans’ principal

Gordon Wilson, President and CEO of Travelport, commented:

“Travelport delivered a robust set of financial results during the third quarter against the backdrop of slower growth of the global GDS air market.  International revenue increased 9% as we continued to benefit from our unrivalled airline merchandising innovations, our diverse Beyond Air portfolio and our balanced geographic presence.  Moreover, during the quarter we continued to deliver against our key strategic objectives, announcing several new commercial deals across our platform.  These included a GDS industry-first partnership with the largest airline in India, IndiGo, a long-term agreement with easyJet to continue provision of our multi award-winning mobile services, and a new data and analytics partnership with Mastercard.  We are also pleased with several new agency wins in key regions, which will support future growth, as well as continued momentum in our BtoB payments business, eNett, having delivered net revenue growth of 72% for the nine months of this year.”

Summary

Three months ended

September 30,

Nine months ended

September 30,

(in $ thousands, except per share amounts) 2016 2015  Better / (Worse) 2016 2015 Better / (Worse)
Net revenue 590,756 559,837 6% 1,805,924 1,686,167 7%
Operating income 62,235 54,091 15% 179,863 150,986 19%
Net income 21,404 4,950 * 24,156 14,251 70%
Income per share – diluted 0.17 0.03 * 0.18 0.09 100%
Adjusted EBITDA 150,432 130,977 15% 443,585 405,421 9%
Adjusted Operating Income 87,757 78,224 12% 267,017 235,291 13%
Adjusted Net Income 40,995 30,087 36% 126,237 95,151 33%
Adjusted Income per Share – diluted 0.33 0.25 32% 1.02 0.78 31%
Net cash provided by operating activities 110,926 61,569 80% 213,858 153,735 39%
Adjusted Free Cash Flow 83,170 31,113 167% 130,443 63,796 104%
Cash dividend per share $0.075 $0.075 $0.225 $0.225
* Percentage calculated not meaningful
The Company refers to certain non-GAAP financial measures in this press release, including Adjusted EBITDA, Adjusted Operating Income (Loss), Adjusted Net Income (Loss), Adjusted Income (Loss) per Share, Capital Expenditures, Net Debt and Adjusted Free Cash Flow.  Please refer to pages 10 to 13 of this press release for additional information, including reconciliations of such non-GAAP financial measures.

Discussion of Results for the Third Quarter of 2016

Unless otherwise stated, all comparisons are for the third quarter of 2016 compared to the third quarter of 2015.

Net Revenue
Net revenue is comprised of:

Three Months Ended September 30, Nine Months Ended September 30,
(in $ thousands) 2016 2015 % Change 2016 2015 % Change
Air $407,926 $398,781 2 $1,277,671 $1,231,276 4
Beyond Air 151,857 129,183 18 435,056 361,003 21
Travel Commerce Platform 559,783 527,964 6 1,712,727 1,592,279 8
Technology Services 30,973 31,873 (3) 93,197 93,888 (1)
Net Revenue $590,756 $559,837 6 $1,805,924 $1,686,167 7

Net revenue increased by $31 million, or 6%, to $591 million primarily due to growth in Travel Commerce Platform revenue of $32 million, or 6%.  Within Travel Commerce Platform revenue, Air revenue increased by $9 million, or 2%, mainly due to improved pricing and merchandising.  Beyond Air revenue increased by $23 million, or 18%.  Within Beyond Air, net revenue for eNett increased 60% to $42 million driven by the volume of payments settled with existing customers and several new customer implementations.  Technology Services revenue decreased marginally by $1 million, or 3%.

The table below sets forth Travel Commerce Platform revenue by region:

Three Months Ended September 30, Nine Months Ended September 30,
(in $ thousands) 2016 2015 % Change 2016 2015 % Change
Asia Pacific $129,309 $   117,145 10 $388,330 $    350,315 11
Europe 180,746 159,193 14 558,303 474,833 18
Latin America and Canada 26,336 27,022 (3) 82,617 75,082 10
Middle East and Africa 72,833 71,581 2 223,629 219,529 2
International 409,224 374,941 9 1,252,879 1,119,759 12
United States 150,559 153,023 (2) 459,848 472,520 (3)
Travel Commerce Platform $559,783 $   527,964 6 $1,712,727 $  1,592,279 8

The table below sets forth Travel Commerce Platform Reported Segments and global RevPas by region:

Segments (in thousands)
Three Months Ended September 30, Nine Months Ended September 30,
2016 2015 % Change 2016 2015 % Change
Asia Pacific 16,735 16,002 5 50,733 48,763 4
Europe 19,588 19,407 1 63,282 62,476 1
Latin America and Canada 4,279 4,269 13,353 12,750 5
Middle East and Africa

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