Sabre Reports Quarterly Financial Results

Sabre Corporation (NASDAQ: SABR), one of the global leaders in travel technology solutions, reported its second quarter 2016 financial results this week.

“Sabre second quarter results build on our growing and consistent track record of solid execution,” said Tom Klein, Sabre president and chief executive officer. “While the macro environment has offered little upside, our results demonstrate our ability to grow as we capitalize on strong demand for our Airline and Hospitality Solutions SaaS portfolio and as Travel Network continues to expand globally.”

The company reports results in two business segments: Travel Network, a global travel marketplace that connects more than 425,000 travel agencies and travel management companies in more than 160 countries with airlines, hotels, car hire, cruise lines, tour operators and other travel suppliers across the world, and the Airline and Hospitality Solutions business, which provides technology software solutions and consulting to the global airline and hospitality industries.  For the second quarter 2016, highlights included:

·         Travel Network revenue rose 21 percent with bookings growth of 24 percent, driven by the now wholly-owned Asia-Pacific region and incremental growth in all other regions

·         In the Airline and Hospitality Solutions business, revenue increased 16 percent

·         Strong growth in the SabreSonic reservations system that it provides to airlines around the world, with 200 million passengers boarded – a growth of 43 percent year-over-year.  Passengers boarded growth was driven by a mix of new implementations and 6 percent organic growth in the existing customer base

·         Growth in Airline Solutions was also driven by increased revenue from the AirVision and AirCentre solutions suites which provide airlines with tools to improve efficiency, control costs and manage change. Strong Sabre Hospitality Solutions growth, both organic and acquisition-related, also contributed to the revenue increase. Sabre Hospitality Solutions acquired German-based Trust Group, which has expanded its hospitality footprint in both EMEA and Asia-Pacific, and it continues to migrate the properties of the Wyndham Hotel Group – the world’s largest hospitality company with more than 7,500 properties – onto its reservations platform

Outside of North America, the company reported the following:

·         In EMEA, the long-term trajectory of Travel Network share gains continues with another quarter of year-over-year growth and market share gains; the company continues to look for opportunities to build its presence in new markets like South Africa, Spain and Turkey 

·         Travel Network bookings in Latin America turned mildly positive in the quarter, increasing 1.5 percent, including a return to modest growth in Venezuela and Brazil

·         In Asia-Pacific, the end of the second quarter marks the anniversary of Sabre’s full ownership of that business in the region.  Operations are largely integrated and sales progress has been strong with like-for-like Travel Network bookings growth of 9 percent

·         Globally, Sabre’s share of GDS bookings remained relatively constant at 37 percent.  The company also told investors on its quarterly conference call that it had signed renewals and expansions with several key customers.  

“Our team is laser focused on the things we control – launching new and innovative products, staying far ahead of our competitors in areas like mobile and cloud, taking care of our customers and finding new ones, and ensuring we have an advantageous cost structure,” said Klein during a conference call to investors on August 2.  “While never satisfied, we are pleased with our first half results and expect a good remainder to 2016.

“One of our key drivers is our strategy to continue to broaden our offerings with innovative – and in many cases, highly unique solutions in a category.  I have previously discussed how Intelligence Exchange and our retailing and merchandising solutions are helping to bolster growth. And we continue to introduce new innovations that will further enhance airlines’ ability to get deeper insights into their data and create actionable events tailored to specific customers,” said Klein.

“Ancillary revenue growth has been an important part of the story for airlines over the last several years. Most of this growth was driven through their direct channel. We expect the next leg of growth in ancillary revenue will be driven through the GDS, and Sabre is positioned to lead the way. Our technology is ready and we believe the commercial willingness is there to drive meaningful growth for our airline customers.  In fact, four of the five largest North American-based airlines are committed to distributing their paid seats and other ancillaries through the Sabre Marketplace.  These airlines recognize the meaningful ancillary sales revenue that can be generated through our network of travel agencies,” said Klein.

U.S.-based Sabre is headquartered in the greater Dallas-Fort Worth region of Texas, and processes more than US$120 billion of travel spend annually, serving customers in more than 160 countries around the world.  It has nearly 10,000 employees globally.