GDS Operators Report Growing Transaction Volumes
Amadeus and Worldspan today each reported higher overall transaction volumes during the second quarter, powered by particularly strong online business and increased booking levels overseas. Sabre Holdings and Cendant recently reported similar trends for their travel distribution operations.
Worldspan was the only one of the four to report lower overall revenues. Operating profits, however, were higher by 14 percent, resulting from lower overall costs, despite a 5 percent increase in travel agency inducements.
The company said global transactions grew 1 percent, with 6 percent growth outside the United States and flat volume inside the domestic market. Online agency transactions grew 8 percent, while traditional volumes declined 5 percent.
"On the traditional side, Worldspan historically has seen a decline," said chairman and CEO Rakesh Gangwal during an analysts' conference call this morning. "We do not have as dominant a presence with corporate customers as Sabre has. With the economy improving, corporate travel is rebounding rapidly, to Sabre's benefit. One of our numero uno priorities is to try to grow the traditional business."
Amadeus' online transaction growth was more pronounced, up 42 percent in the second quarter. Overall, booking levels jumped more than 9 percent and the company claimed to have increased its leading global share of travel agency airline bookings to just over 29 percent.
Amadeus also said aggregate bookings by more than 300 companies using the E-Travel Aergo platform grew 16 percent in the quarter. Bookings through the E-Travel-backed SAP Travel Management solution were up 31 percent.
On the hotel front, Amadeus said it added 1,600 hotel properties to its distribution system in the second quarter, including roughly 400 independent properties.
Including strong growth in its e-commerce and airline IT services divisions, Amadeus said its overall second-quarter net income rose 42 percent to €79.5 million (US$98.3 million).
Meanwhile, Sabre Holdings late last month announced revenue growth of 5.3 percent for Sabre Travel Network. The company said total global travel transactions grew 6 percent, with international transaction growth of 11 percent outpacing domestic U.S. growth of 3 percent. Online transaction growth of 14 percent was well ahead of traditional agency transaction growth of 5 percent.
At Travelocity, revenues grew 37 percent to $172 million and now represent nearly 30 percent of total Sabre Holdings revenue. Air transaction revenue grew 9 percent while hotel room nights across the Travelocity network jumped 41 percent.
Cendant late last month similarly reported growth in its Travel Distribution Services division. Galileo GDS and supplier services revenue during the second quarter increased 3 percent on 6 percent greater GDS segment volume. The company detailed stronger international transaction growth and much stronger online transaction growth--30 percent compared with traditional agency growth of 3 percent.