With TRX's stock price in the tank, trading in the half-a-buck range throughout December, the travel technology company made a leadership change.
Trip Davis, president and CEO for the past nine years, transitioned to the chairman's role. Shane Hammond, a TRX vice president, was promoted to replace Davis.
Hammond, a former Carlson Wagonlit executive, faces choppy waters in his attempt to right the ship.
TRX has been struggling to broaden its client base and improve its cost structure, while the recession and airline capacity reductions stand to take a bite out of transaction volume.
TRX gets some 40% of its revenue from Expedia. It performs transaction processing, reservation fulfillment and reporting services for an array of Expedia corporate and leisure travel units both domestically and internationally.
In November, Expedia informed TRX that it would begin reducing transaction volume through TRX in the first quarter of 2009. This, coupled with cuts in airline volume, could materially impact TRX's operating results if discussions with Expedia prove unsuccessful in resolving the issue.
In addition, TRX indicated that it expected reduced revenue in 2008 from Citibank, after the companies amended their agreement earlier in the year.
In the third quarter of 2008, TRX's revenue from its core business, transaction processing, dropped 5.8%, to $16.1 million. Overall, the company's net loss for the quarter was $2.1 million, compared with a net loss of $3.9 million in the third quarter of 2007.
In announcing the leadership changes in December, Davis characterized himself and Hammond as "a formidable tandem." Davis added that Hammond is focused on changes that would transform TRX "from a labor-intensive outsourcing company for a few, large clients to a more nimble and scalable travel technology and data services leader for many clients."
TRX, a company majority-owned by BCD Holdings, executed an IPO in 2005 at $9 per share. In three successive years prior to the IPO, TRX recorded net losses.