Sabre GDS: Positioned for Growth

by Michele McDonald

Sabre reported net income of $71.9 million for 2014, a year that president and CEO Tom Klein described as “a year of transition with focus.” It was a nice turnaround from 2013, when it reported a net loss of $97.6 million.

During Sabre’s fourth quarter and full year 2014 earnings call, Klein called the company’s fourth quarter was “solid but muted."

Although Sabre’s airline and hospitality solutions business was buoyed by “strong execution and customer growth,” with a revenue increase of 13.5%, the Travel Network side of the house experienced “headwinds” that led to a slight drop in revenue of 1.4%.

Adverse impact
Among the factors that affected Sabre Travel Network’s performance were the pricing impact of the merger of American Airlines and US Airways and the decline in travel in Venezuela.

Many airlines have stopped serving the country, whose aviation market is nothing short of a mess, and the decline has affected Sabre more than other GDS companies due to its 60% market share in Venezuela.

“I don’t see a recovery in sight there, given what’s going on with the government,” Klein said.

The EMEA region -- Europe, the Middle East and Africa -- on the other hand, were a bright spot for Sabre’s GDS business. “As we enter 2015, we’ve opened more than a dozen new markets,” Klein said.

The Sabre Travel Network is well positioned for growth in 2015, he added.

“The corporate market will be improved and you’ve got to like the fact that people expect [airline] capacity to increase,” said Klein.

Overall bookings are up
Overall, air bookings were up 2.4% for the year, to 321.9 million, and up 1.2% for the quarter, to 70.8 million.

Non-air bookings were up 1.2% for the year, to 54.1million, and up 0.6% for the quarter, to 12.8 million.

Asked about Sabre’s Securities and Exchange Commission (SEC) filing in which it reported that it was exploring a new acquisition, Klein said the company was in an “awkward spot.”

“We disclosed what we had to disclose because we were doing an equity offering,” Klein said. Declining to elaborate, he said, “I would just say it’s a unique opportunity, and we’re excited about it.”

The acquisition target is widely believed to be Abacus International, the Singapore-based GDS company that is a joint venture of Sabre and a consortium of Asian airlines.

  0
  0
TMR Recommendations
Top Stories
Paying for Referrals: Travel Agents Differ on Approaches to Customer Rewards

To reward or not to reward? Some travel advisors send gift cards — but some say there is something much more valuable.

Trip Protection and Travel Insurance: Are They the Same Thing?

Used interchangeably, the two phrases are technically dissimilar. So, the industry is still educating travel agents about the differences.

14 Ways to Build Stronger Supplier Partnerships

A former director of travel industry sales for Four Seasons Hotels shares her commonsense tips for maximizing relationships with suppliers to ensure you receive top value for your clients and your business.

What Impact is Galaxy’s Edge Having on Future Disney Bookings?

Speculation about low Disney parks attendance swirled around the dismissal this week of a senior executive who oversaw the Star Wars attraction opening. Agents aren’t sure about future impact.

With the Media Growing, Travel Agents Seek to Become Video Influencers

Three travel advisors are collaborating with a professional video storyteller to build their brands and attract luxury clients.

‘A Sad Day in the Travel Community’: Fallout from Thomas Cook’s Collapse Continues

The travel industry has been reacting to the news of the collapse of the 178-year-old British travel company.

News Briefs
Tip of the Day

"I didn’t understand that they could access these amenities through the buying power of these networks they join. I didn’t realize that an agent could open doors that I couldn’t."

Julia Glum

Money Magazine

Daily Top List

Best Hotels in Detroit

  1. Detroit Foundation Hotel
  2. The Townsend Hotel
  3. MGM Grand Detroit
  4. The Royal Park Hotel
  5. The Henry, Autograph Collection

Source: US News

TMR Outlooks