TRX has "cleared the strategic decks" to focus on corporate travel online booking, travel reservation processing and corporate travel data reporting, said president and CEO Trip Davis in the company's third-quarter earnings call today. Davis called 2007 a "transformation year," as TRX exited from most of its call center business and integrated the acquisitions of Travel Analytics and Hi-Mark Software.
TRX reported a decline in third-quarter revenues and a significant drop in net income from 2006, but the company increased its technology development expenditure by 25 percent compared with last year.
"A lot of the revenue takeout was by design to focus the company on those three areas," Davis told
BTN. He said the call center business, which TRX now only operates in Berlin, accounted for much of the revenue decline, but TRX also cut headcount by half to 800.
Third-quarter revenues from transaction processing services fell 10 percent from the same period last year to $15.8 million from $17.6 million. Revenues from data reporting services declined to $4.1 million from $4.5 million for the quarter. The company also posted a net loss of $3.9 million in the quarter compared with a net income of $1.3 million in the third quarter of last year.
Despite the revenue declines, TRX increased its revenue expectations for full-year 2007 of $85 million to $90 million, to $93 million to $97 million, and Davis told
BTN he expects the business travel market to remain robust. "We have seen a very strong economic environment and a very strong business travel environment in 2007," he said. "Overall, we see that companies are being very careful about their travel spending. They are doing a better job of managing their spend with supplier contracts and data reporting."
Meanwhile, the company is developing its new Correx Gen6 mid-office platform
(BTN, July 23), which it expects to roll out next year, according to Davis.