Travelport Sees Continued Strengthening Despite Third-Quarter Decline

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Travelport Sees Continued Strengthening Despite Third-Quarter Decline

By Jay Boehmer

NOVEMBER 05, 2009 -- Travel technology and global distribution firm Travelport today reported that global segments were down nearly 5 percent for the third quarter, but said it reached positive territory in the past month.

"We've seen a bit of a continued strengthening," said Travelport CEO Jeff Clarke, noting that for October and the first four days of November, global segments were up by 3 percent, though trends varied greatly by region and business sector.

Regionally, Clarke said segments in the past month in the Americas were up about 6 percent, with European segments up 3 percent and Asia/Pacific up 11 percent. "Where we're continuing to see a decline, not because of the market but because of the strategy that we have, is in the Middle East, where we're down about 20 percent," Clarke said. Travelport last year shifted its Middle East strategy to favor more direct relationships with travel agencies (BTNonline, Sept. 22).

Clarke said online travel agency segments continue to drive its overall growth and registered a 24 percent increase in October, while the corporate segment continues to lag, as it was down by low single-digit percentages.

While still in negative year-over-year territory, Clarke said the corporate figures represented a marked improvement from the first half of this year. "Corporates have made a pretty strong turnaround. This is somewhat due to easy compares. If you remember October, it was post-Lehman crash, when there were a lot of cancellations of travel as people immediately looked to cut expenses."

Though trends are improving, Clarke said corporate travel momentum is the most tenuous of all of its business segments. "Corporate travel is the one where we're going to be very cautious calling a recovery on that. We're seeing some good trends as I mentioned earlier, but if a downturn happens again, people will shut it down as fast as they did last time."

In response to rumored merger discussions with Amadeus or the potential of an initial public offering, Clarke said, "We don't speculate on any rumors. Both of those are rumors."

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