The SABRE Group Reports First Quarter Results
FORT WORTH, Texas -- The SABRE Group (NYSE: TSG) today announced financial results for the first quarter ended March 31, 1998. The company generated record revenues of $554 million in the quarter, an increase of 25.8 percent over first quarter 1997 revenue. Net earnings grew 7.7 percent to $72 million, or $0.55 per share on a diluted basis, compared to net earnings of $67 million, or $0.51 per share on a diluted basis, in the same period last year. Operating income grew 5.5 percent to $114 million for the quarter, compared to $108 million during the same period in 1997.
"We are pleased with our results for the first quarter, which were consistent with our expectations. Revenue growth was very strong due to the start of our work on the US Airways outsourcing contract, growth in international and non-airline bookings, and a booking fee price increase," said Michael J. Durham, president and chief executive officer of The SABRE Group. "Expenses rose in response to the overall growth of the company and increased spending on Year 2000 compliance projects."
The company reported revenue growth of 59 percent in its information technology solutions business and 11.7 percent in its electronic travel distribution division. International and non-airline reservations grew 9.5 percent and 8.5 percent, respectively, while domestic reservations declined 1.5 percent. Direct reservations booked through the SABRE system were 96 million - 1.5 percent higher than the same period last year.
"International air bookings growth was very strong, particularly in Latin America. Domestic bookings were down primarily due to the introduction in February of the new non-billable booking code, and lower than expected growth in domestic airline enplanements. These factors were partially offset by continued growth in The SABRE Group's CRS market share," Durham added. "The commencement of work on the US Airways outsourcing contract and Year 2000 related activities for AMR Corp. were the primary causes of growth in the ITS division. Demand for ITS products and services remains strong."
The SABRE Group is a world leader in the electronic distribution of travel and travel-related services around the globe, and is a leading provider of information technology solutions for the travel and transportation industry, including customized software development and software products, transaction processing, consulting and total IT outsourcing.
Statements in this news release about anticipated or expected future revenue and earnings growth are forward looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All forward looking statements in this release are based upon information available to The SABRE Group on the date of this release. Any forward looking statements involve risks and uncertainties that could cause actual events or results to differ materially from the events or results described in the forward looking statements, including risks of changes in relationships with American and its affiliates; competition and technological innovation by competitors; risks related to the Company's technology, such as a failure to timely achieve Year 2000 compliance; seasonality of the travel industry and booking revenues; sensitivity to general economic conditions and events that affect airline travel; risks associated with the Company's international operations; and legal and regulatory issues . The SABRE Group undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward looking statements.
SABRE is a registered service mark, and the SABRE Group logo is a service mark of an affiliate of The SABRE Group Inc. 1998 The SABRE Group Inc. All rights reserved.