Travelport Stung by Lower Revenue From Orbitz and Europe

Travelport felt the sting of lower revenue from a renegotiated contract with Orbitz Worldwide and softness in Europe as the distribution company reported a 3% decrease year-over-year in air travel revenue in the first quarter.

Travelport controlled Orbitz Worldwide for years but sold its stake last year and renegotiated its global distribution system contract.

On the positive side, Travelport saw an 11% upswing in hotel bookings in the first quarter but hotels, cars, rail and tours, which Travelport calls Beyond Air, is only about 20% of Travelport’s overall business.

Its Beyond Air segment saw a 14% year-over-year increase in revenue to $114 million but that was offset by the drop in flight volumes.

Travelport gave up its overriding influence over Orbitz last year, leading up to a Travelport IPO.

Travelport reported today that its 3% decrease in air revenue to $432 million in the first quarter was “mainly attributable to lower volumes from our 2014 renegotiated contract with Orbitz Worldwide, Inc. and reduction in the European region, partially offset by growth in the Asia Pacific region.”

Travelport also announced a long-term distribution agreement with Accor Hotels and and an agreement with Germany-based Hotel Reservation Service to gain access to its 250,000 independent hotels across 190 countries.

Travelport’s car-rental-days-sold were up 11% year-on-year for the first quarter and March saw its highest number of rentals in its history for a single month.