Sabre passes Travelport in transactions

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The Sabre GDS last year managed to overtake Travelport's Galileo and Worldspan systems in terms of the number of segments processed worldwide.

The Sabre Travel Network handled 383 million transactions in 2008, but while that marked a 3% decline, it still topped the 372.1 million segments reported by Worldspan and Galileo (including Apollo in the U.S. and Japan). As a group, the Travelport units saw an 11% decline.

Such comparisons have been difficult to come by in recent years because all of the major GDSs, including Amadeus, are privately owned.

But Sabre decided to publicly release its full-year 2008 and Q4 earnings March 5, for the first time since the company went private on March 30, 2007, to set the record straight because of unspecified "misinformation" circulating, and the challenging economic climate, an official said.

Amadeus hasn't publicly released the number of GDS segments it processed in 2008, so at this juncture market share can't be determined from publicly available data.

One factor behind Sabre's moving up the ladder and overtaking Travelport in global transactions may have to do with Sabre's partnership with Expedia Inc.

Until 2007, Worldspan was Expedia's primary GDS, but in its latest annual disclosure to the Securities and Exchange Commission last month, Expedia Inc. stated that Sabre and Amadeus are now its primary GDS providers. Sabre also processes transactions for Priceline, which previously had an exclusive relationship with Worldspan.

Overall, Sabre recorded a net loss of $320 million in 2008, widening an $84 million loss for 2007, on essentially flat revenue of $2.9 billion.

Most of the damage seems to have come in the fourth quarter, which was marked by a net loss of $319 million as revenue fell 10%, to $603 million.

The 2008 result includes a $382 million, noncash impairment charge, which Sabre said had no bearing on its operations or cash-flow position.

The company, which operates GDS, Travelocity and Airline Solutions businesses, said it was poised to weather what it expects to be a rocky 2009 because of a cost-savings program ­-- including a workforce reduction and technology efficiencies -- that translates into more than $300 million in annual savings, based on experience to date.

As for the other units, Travelocity's gross bookings fell 1%, to $10.6 billion, but Airline Solutions, which provides software solutions, including merchandising tools, to airlines, had a "fabulous" year in sales, earnings and margin, CFO Jeffery Jackson told analysts.

Passengers boarded grew 6% in 2008, to 278 million, and the unit set a new record last year in new-contract sales, which came in at more than $400 million, he said.

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