On the back of a major cost-cutting exercise, Sabre Corporation has released its 3Q2017 financial results showing a revenue of US$900.6 million, up 7.3 per cent year-on-year, and a staggering 96.1 per cent growth in operating income to US$176.8 million.
Looking at Sabre’s Airline and Hospitality Solutions unit, revenue increased 4.8 per cent to US$274.9 million, with mid-single digit revenue growth in AirVision and AirCentre solutions, and Hospitality Solutions revenue increasing in the mid-teens, offset somewhat by a modest decline in SabreSonic revenue due to the ending of legacy reservations system services to Southwest Airlines.
Airline passengers boarded declined 9.4 per cent due to the impact from Southwest Airlines. Excluding the carrier, total passengers boarded increased 11.5 per cent, driven by the implementation of Alitalia in October 2016 and passengers boarded growth of 7.7 per cent on a consistent carrier basis.
Operating income increased 28.3 per cent to US$68.4 million, with a margin of 24.9 per cent compared to 20.3 per cent for the prior-year quarter.
Adjusted EBITDA increased 17.4 per cent to US$111.7 million, and its margin was 40.6 per cent, widened from the 36.2 per cent in 3Q2016.
According to Sabre, Airline and Hospitality Solutions operating income and Adjusted EBITDA growth were supported by the benefits from the cost reduction and business alignment programme initiated in August 2017 and higher service-level agreement expenses in the 2016 quarter.
Key customer wins including Travelgenio, the second largest OTA in Spain, Shenzhen Airlines and China Airlines, and Rydges Hotel Group and Sokos Hotels. Its Airline Solutions delivery team completed over 40 customer implementations, including its SabreSonic reservation system and a broad suite of solutions at Air Niugini, it said.
Meanwhile, revenue from Sabre’s Travel Network rose 8.6 per cent with global bookings growing 3.2 per cent. Bookings grew 16 per cent in EMEA and 10.8 per cent in Asia-Pacific, but declined 1.9 per cent in North America and 1.9 per cent in Latin America – dampened by the impact of recent hurricanes in the US and Caribbean
Travel Network operating income increased 8.7 per cent to US$198.4 million. Operating income margin was 31.4 per cent, compared to 31.3 per cent for the prior-year quarter. Adjusted EBITDA increased 7.9 per cent to US$237.3 million, with a margin of 37.5 per cent compared to 37.8 per cent in the prior-year quarter.