28 Jul 2017

Amadeus starts to see the Southwest impact

Amadeus’ second quarter and first half results show a positive operational and financial performance, boosted by the Navitaire numbers and by the migration of Southwest onto Altea.

The Southwest migration is a significant milestone for Amadeus, as it gives the European business a strong foothold in North America. Southwest’s move took place at the start of May, and the immediate impact is clear. The number of North American “passengers boarded” in the April-June quarter was up by more than 140% compared with the same period in 2016, with North America now accounting for 10% of the total.

This is a higher proportion than the Middle East and Africa (7.7%), central, eastern and southern Europe (5.4%) and Latin America (8.5%), although these regions are growing compared with Q2 2016.

Looking at the first six months of the year, the total number of passengers boarded using Altea or Navitaire’s New Skies was 753.8 million, an increase of nearly 20% on the first half of 2016.

While the volumes have been boosted by new airline customers – as well as Southwest it mentions Malaysia Airlines, Swiss, Brussels Airlines and China Airlines among others – it recorded an organic growth from existing customers of 8.1%.

Revenues from airline IT for the half were up 13.3% at €855.2 million, helped by positive forex.

Its distribution business has also grown, with Amadeus claiming a strengthening of its competitive position. It says it now has 43.6% share of the market for air bookings made through travel agencies. These figures do not include bookings made in China, Japan or Russia which Amadeus admits “together combined represent an important part of the industry.”

In the half, Amadeus connected agents took 295.2 million air bookings and 33.2 million non-air bookings, increases on H1 16 of 5.7% and 5.8% respectively.

Revenues from distribution were up 7.6% to more than €1.6 billion, helped by positive forex.

Click here to access Amadeus’ Investor Relations page where the financials can be accessed.