The first quarter results of Amadeus Global Travel Distribution, have shown a healthy growth for the company. Amadeus, as per the results not only maintained its margins but also recorded an increase in net income.

In travel distribution, total bookings, including the leisure bookings of Start Amadeus, which Amadeus fully consolidated in March, grew by 1.6 per cent while bookings excluding Start leisure declined by 2.1 per cent over the period.

In adverse market conditions, Amadeus was able to increase its global share of air travel reservations made by travel agencies by 2.6 percentage points to 29.1 per cent, making it the largest travel agency GDS for the second consecutive quarter.

Amadeus grew its market share in every continent, most strongly in Central, Eastern and Southeastern Europe by 6.2 per cent to 53.8 per cent in Western Europe by 3.5 per cent to 54.5 per cent in Africa and the Middle East by 4.5 per cent to 18.6 per cent.

In North America, Amadeus bookings declined by 11.9 per cent albeit less than the total market, thus raising Amadeus’s share by 0.2 per cent to 8.6 per cent.

Globally, strong reservation growth rates were achieved in significant individual markets, making inroads against competitors’ market positions:

In markets where Amadeus traditionally has a high market share, it has been able to hold or grow that share during the quarter, as, for example in Spain which has seen reservations growth of 18.4 per cent, taking the market share up 1 per cent to 94.6 per cent.

Total revenues were up by 4.5 per cent to 502.7m. Non-reservation related revenues increased 35.3 per cent to 116.1 m. Of this revenue from Airline IT Services grew by 52 per cent as more systems for British Airways and Qantas become operational.
The EBITDA margin at 28.1 per cent, hedged against currency fluctuations, remained almost flat against the same period in 2002, as did net income and EBIT margins, showing the positive effect of cost containment even as Amadeus consolidated the Start and ICSA-T acquisitions.

Operating expenses for the quarter were 407.2m, 5.2 per cent ahead of the same quarter in 2002. Cost of sales was negatively affected by 15.2 m derived from acquisitions.

Operating income for the quarter was 95.5m, a 1.5 per cent increase compared to 2002. This line is negatively impacted by 7.2m due to doubtful debt provision.

Net income excluding special items is up 4.3 per cent to 50.7m while net income including special items is down 9.6 per cent over the same quarter in 2002. This is due exclusively to unrealised gains from equity swap agreements and issue of warrants for Amadeus share to third parties which in the same quarter of 2002 had shown a significant gain.

Outlook
Amadeus continues to focus on the extension of its business lines into IT services and e-commerce to meet the developing requirements of the travel and tourism industry, while maintaining the largest geographical footprint in the sector. Complementing this successful strategy with agile cost control has enabled the company to weather adverse market conditions. However, it cannot meaningfully forecast performance while visibility remains so low for the industry as a whole in relation, for example, to the SARS effect. The company will provide forecast data as soon as feasible.

Operating Highlights
During the first quarter, a total of ten new airlines have contracted to use the Amadeus Sales System in their airport and city ticket offices as their exclusive ticket sales and distribution system.

During the quarter, Advantage, Alamo, Enterprise, Europcar, Hertz, National and Thrifty selected Complete Access Plus, Amadeus’s enhanced car booking solution. These companies, together with Avis and Sixt, who are already using Complete Access Plus for distribution of their offer, represent 93.5 per cent of all car reservations made through the Amadeus System.

Amadeus confirmed in February that it had completed the acquisition of its German distribution partner, Start Amadeus, from Lufthansa Commercial Holding. Also Europe’s leading leisure package distribution company, Start Amadeus will be consolidated within Amadeus with effect from1 March 2003.

e-Commerce (including e-Travel)
In January, TQ3 Travel Solutions, one of the world’s largest providers of travel management services, and e-Travel, the e-commerce unit of Amadeus, announced a strategic partnership whereby TQ3 will provide e-Travel’s online self-booking tools to its corporate customers around the world. TQ3 Travel Solutions becomes a global reseller of e-Travel’s broad range of powerful online booking solutions.

During the quarter, e-Travel partnered with France’s rail company, SNCF, to enable French corporations and travel agencies to both manage and book rail travel online via e-Travel Aergo. Amadeus was the first to integrate rail distribution in e-commerce and corporate booking tools, and currently distributes the services of 18 of the world’s leading railway companies.

In March, Amadeus announced that it will provide lastminute.com and its well known brands, Travelselect.com and Travelprice.com, with access to the Amadeus System, through which lastminute.com’s customers can make bookings. Connectivity to Amadeus is provided by the Amadeus Application Programming Interface (API) which offers highly scalable architecture, faster performance, increased reliability and important savings in development and operational costs.