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Worldspan drops into red
Worldspan has blamed a $55.6 million refinancing charge for dropping the company into the red in 2005.
The GDS incurred a net loss of $0.7 million for the year but claimed that without the charge a profit of $54.9 million would have been achieved – a $13 million improvement over 2004.
A range of cost reductions including lower employee costs, communication and technology expenses, maintenance expenses and other expenses led to a 31% improvement in the 2005 operating income to $116.1 million.
Global transaction volumes remained unchanged at 2004 levels, while transaction volumes by online agencies grew by 5% but traditional agency volumes dropped by 5%.
The company reported a fourth quarter net loss of $3.2 million against a loss of $5.6 million in the same three months in 2004. Operating income was up to $10.5 million, a rise of $5.4 million. Global transaction volumes in the quarter were down by 4% year-on-year. Transactions by online agencies dropped by 4% and by traditional agencies by 5%.
Chairman, president and CEO Rakesh Gangwal said: “We are pleased with the continued growth of our operating income in the quarter, given a challenging revenue environment.
“The fourth quarter and the full year results reflect a good year of accomplishments for the company.”
Report by Phil Davies
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