Travelport: Decline In Segments Reflects Market Softness

Travelport during its first-quarter earnings call today said segments for its global distribution system businesses have decreased from the same period last year as the company continues to see softness in both the consumer and corporate travel markets.

Segments booked through its Galileo GDS were down 3 percent globally, with the Americas region creating the greatest drag in the business, registering a 7 percent slip from the same period in 2007. Segments through the Worldspan GDS, which the company acquired last year, recorded a 19 percent decline from the first quarter in 2007, but Jeff Clarke attributed 80 percent of that to Worldspan's loss of Expedia's segments.

"The number I would use to test the tone of the business would be the Galileo Americas segment, which is down 7 percent in the most recent quarter, and it's trending in a similar fashion in the first half of Q2," Clarke said. "April was a little stronger than May: We got a nice little early April shift but that dissipated in the first week or week and a half in May. It's very difficult to project these things. We're not seeing a market weakness in consumer versus corporate, we're seeing weakness in the Americas in both. We see this as a softness."

Adding color to the GDS segment decline, Clarke noted the barrage of bad news encountered by airlines, saying "a lot has been thrown at the market: We've had bankruptcies, unusual groundings, we've had consumer confidence at record lows, business logically pulling back and tightening their belt, particularly in the financial sectors."