Expedia Reports Softening Egencia Bookings

Internet travel management company Egencia today reported an 18 percent year-over-year decrease in gross booking volumes to $321 million in the first quarter, the first in which parent company Expedia Inc. broke out managed corporate travel business from other segments.

Egencia's business had grown steadily since its initial launch as Expedia Corporate Travel in late 2002, but as the economy and corporate travel demand has shifted downward, so has its volumes. The first-quarter gross bookings decline contributed to Egencia's 10 percent decrease in revenues to $25 million. For the full year 2008, Egencia had $1.5 billion in gross bookings, a 15 percent increase over 2007. Total Egencia 2008 revenue increased 21 percent, year-over-year.

During the first quarter, Egencia lost $1 million in operating income before amortization. In the same period last year it earned $2 million in OIBA.

The company now separates its Egencia business, which previously combined with Expedia's Asia/Pacific operations, as part of the first quarter's implementation of a global reorganization.

Meanwhile, Expedia's worldwide hotel revenue decreased 10 percent in the first quarter as revenue per room night decreased 20 percent, primarily due to an 18 percent decrease in worldwide average daily rates. According to CEO and president Dara Khosrowshahi, average daily rate declines look to be leveling out based on advanced booking data.

Despite steep declines in some of its business segments, Expedia earned a $492.2 million gross profit, an 8 percent decrease compared with the first quarter of 2008. Total quarterly revenues also declined 8 percent to $635.7 million.