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Bermuda
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98-0505105
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(State or other jurisdiction of
incorporation or organization) |
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(I.R.S. Employer
Identification Number) |
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Large accelerated filer ☒
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Accelerated filer ☐
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Non-accelerated filer ☐
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Smaller reporting company ☐
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(Do not check if a smaller reporting company)
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Page
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PART I. FINANCIAL INFORMATION
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| | | | 1 | | | |
| | | | 3 | | | |
| | | | 3 | | | |
| | | | 4 | | | |
| | | | 5 | | | |
| | | | 6 | | | |
| | | | 8 | | | |
| | | | 9 | | | |
| | | | 21 | | | |
| | | | 41 | | | |
| | | | 42 | | | |
PART II. OTHER INFORMATION
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| | | | 43 | | | |
| | | | 43 | | | |
| | | | 43 | | | |
| | | | 43 | | | |
| | | | 44 | | | |
| | | | 44 | | | |
| | | | 44 | | | |
| | | | 45 | | |
(in $ thousands, except share data)
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Three Months
Ended June 30, 2016 |
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Three Months
Ended June 30, 2015 |
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Six Months
Ended June 30, 2016 |
| |
Six Months
Ended June 30, 2015 |
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Net revenue
|
| | | $ | 605,905 | | | | | $ | 554,202 | | | | | $ | 1,215,168 | | | | | $ | 1,126,330 | | |
Costs and expenses | | | | | | ||||||||||||||||||||
Cost of revenue
|
| | | | 376,605 | | | | | | 335,050 | | | | | | 739,282 | | | | | | 684,281 | | |
Selling, general and administrative
|
| | | | 139,294 | | | | | | 98,159 | | | | | | 253,771 | | | | | | 226,279 | | |
Depreciation and amortization
|
| | | | 52,246 | | | | | | 57,847 | | | | | | 104,487 | | | | | | 118,875 | | |
Total costs and expenses
|
| | | | 568,145 | | | | | | 491,056 | | | | | | 1,097,540 | | | | | | 1,029,435 | | |
Operating income
|
| | | | 37,760 | | | | | | 63,146 | | | | | | 117,628 | | | | | | 96,895 | | |
Interest expense, net
|
| | | | (45,113) | | | | | | (38,751) | | | | | | (100,008) | | | | | | (78,140) | | |
Loss on early extinguishment of debt
|
| | | | (2,671) | | | | | | — | | | | | | (2,671) | | | | | | — | | |
Gain on sale of shares of Orbitz
Worldwide |
| | | | — | | | | | | — | | | | | | — | | | | | | 6,271 | | |
(Loss) income before income taxes and share
of losses in equity method investment |
| | | | (10,024) | | | | | | 24,395 | | | | | | 14,949 | | | | | | 25,026 | | |
Provision for income taxes
|
| | | | (4,405) | | | | | | (7,792) | | | | | | (12,197) | | | | | | (15,550) | | |
Share of losses in equity method
investment |
| | | | — | | | | | | (194) | | | | | | — | | | | | | (175) | | |
Net (loss) income
|
| | | | (14,429) | | | | | | 16,409 | | | | | | 2,752 | | | | | | 9,301 | | |
Net income attributable to non-controlling
interest in subsidiaries |
| | | | (402) | | | | | | (1,081) | | | | | | (998) | | | | | | (2,114) | | |
Net (loss) income attributable to the Company
|
| | | $ | (14,831) | | | | | $ | 15,328 | | | | | $ | 1,754 | | | | | $ | 7,187 | | |
(Loss) income per share – Basic: | | | | | | ||||||||||||||||||||
(Loss) income per share
|
| | | $ | (0.12) | | | | | $ | 0.13 | | | | | $ | 0.01 | | | | | $ | 0.06 | | |
Weighted average common shares outstanding – Basic
|
| | | | 123,825,030 | | | | | | 122,269,482 | | | | | | 123,771,642 | | | | | | 121,842,792 | | |
(Loss) income per share – Diluted: | | | | | | ||||||||||||||||||||
(Loss) income per share
|
| | | $ | (0.12) | | | | | $ | 0.12 | | | | | $ | 0.01 | | | | | $ | 0.06 | | |
Weighted average common shares outstanding – Diluted
|
| | | | 123,990,177 | | | | | | 122,717,897 | | | | | | 123,912,681 | | | | | | 122,672,763 | | |
Cash dividends declared per common
share |
| | | $ | 0.075 | | | | | $ | 0.075 | | | | | $ | 0.15 | | | | | $ | 0.15 | | |
(in $ thousands)
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Three Months
Ended June 30, 2016 |
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Three Months
Ended June 30, 2015 |
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Six Months
Ended June 30, 2016 |
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Six Months
Ended June 30, 2015 |
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Net (loss) income
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| | | $ | (14,429) | | | | | $ | 16,409 | | | | | $ | 2,752 | | | | | $ | 9,301 | | |
Other comprehensive (loss) income, net of tax: | | | | | | | | | | | | | | | | | | | | | | | | | |
Currency translation adjustment, net of tax
|
| | | | (4,799) | | | | | | (83) | | | | | | 2,660 | | | | | | (5,919) | | |
Changes in gain on available-for-sale securities, net
of tax |
| | | | — | | | | | | — | | | | | | — | | | | | | (6,376) | | |
Unrealized actuarial gain (loss) on defined benefit
plans, net of tax |
| | | | 2,251 | | | | | | (47) | | | | | | 4,502 | | | | | | (79) | | |
Other comprehensive (loss) income, net of tax
|
| | | | (2,548) | | | | | | (130) | | | | | | 7,162 | | | | | | (12,374) | | |
Comprehensive (loss) income
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| | | | (16,977) | | | | | | 16,279 | | | | | | 9,914 | | | | | | (3,073) | | |
Comprehensive income attributable to non-controlling interest in subsidiaries
|
| | | | (402) | | | | | | (1,081) | | | | | | (998) | | | | | | (2,114) | | |
Comprehensive (loss) income attributable to the Company
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| | | $ | (17,379) | | | | | $ | 15,198 | | | | | $ | 8,916 | | | | | $ | (5,187) | | |
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(in $ thousands, except share data)
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June 30,
2016 |
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December 31,
2015 |
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Assets | | | | ||||||||||
Current assets: | | | | ||||||||||
Cash and cash equivalents
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| | | $ | 126,937 | | | | | $ | 154,841 | | |
Accounts receivable (net of allowances for doubtful accounts of $13,185 and $14,575)
|
| | | | 241,526 | | | | | | 205,686 | | |
Deferred income taxes
|
| | | | 5,118 | | | | | | 5,133 | | |
Other current assets
|
| | | | 116,893 | | | | | | 99,481 | | |
Total current assets
|
| | | | 490,474 | | | | | | 465,141 | | |
Property and equipment, net
|
| | | | 429,842 | | | | | | 459,848 | | |
Goodwill
|
| | | | 1,083,841 | | | | | | 1,067,415 | | |
Trademarks and tradenames
|
| | | | 314,015 | | | | | | 313,961 | | |
Other intangible assets, net
|
| | | | 524,680 | | | | | | 534,540 | | |
Deferred income taxes
|
| | | | 10,288 | | | | | | 10,348 | | |
Other non-current assets
|
| | | | 48,106 | | | | | | 54,176 | | |
Total assets
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| | | $ | 2,901,246 | | | | | $ | 2,905,429 | | |
Liabilities and equity | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
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| | | $ | 68,033 | | | | | $ | 74,277 | | |
Accrued expenses and other current liabilities
|
| | | | 451,282 | | | | | | 430,650 | | |
Current portion of long-term debt
|
| | | | 64,086 | | | | | | 74,163 | | |
Total current liabilities
|
| | | | 583,401 | | | | | | 579,090 | | |
Long-term debt
|
| | | | 2,346,696 | | | | | | 2,363,035 | | |
Deferred income taxes
|
| | | | 60,556 | | | | | | 59,663 | | |
Other non-current liabilities
|
| | | | 234,664 | | | | | | 226,499 | | |
Total liabilities
|
| | | | 3,225,317 | | | | | | 3,228,287 | | |
Commitments and contingencies (Note 10) | | | | ||||||||||
Shareholders’ equity (deficit): | | | | ||||||||||
Preference shares ($0.0025 par value; 225,000,000 shares authorized; no shares issued and outstanding as of June 30, 2016 and December 31, 2015, respectively)
|
| | | | — | | | | | | — | | |
Common shares ($0.0025 par value; 560,000,000 shares authorized; 124,736,389 shares and 124,476,382 shares issued and 123,872,088 shares and 123,631,474 shares outstanding as of June 30, 2016 and December 31, 2015, respectively)
|
| | | | 312 | | | | | | 311 | | |
Additional paid in capital
|
| | | | 2,714,321 | | | | | | 2,715,538 | | |
Treasury shares, at cost (864,301 shares and 844,908 shares as of June 30,
2016 and December 31, 2015, respectively) |
| | | | (13,533) | | | | | | (13,331) | | |
Accumulated deficit
|
| | | | (2,879,904) | | | | | | (2,881,658) | | |
Accumulated other comprehensive loss
|
| | | | (170,345) | | | | | | (177,507) | | |
Total shareholders’ equity (deficit)
|
| | | | (349,149) | | | | | | (356,647) | | |
Equity attributable to non-controlling interest in subsidiaries
|
| | | | 25,078 | | | | | | 33,789 | | |
Total equity (deficit)
|
| | | | (324,071) | | | | | | (322,858) | | |
Total liabilities and equity
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| | | $ | 2,901,246 | | | | | $ | 2,905,429 | | |
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(in $ thousands)
|
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Six Months
Ended June 30, 2016 |
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Six Months
Ended June 30, 2015 |
||||||
Operating activities | | | | |||||||||
Net income
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| | | $ | 2,752 | | | | | $ | 9,301 | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | | | |
Depreciation and amortization
|
| | | | 104,487 | | | | | | 118,875 | |
Amortization of customer loyalty payments
|
| | | | 34,261 | | | | | | 36,267 | |
Allowance for prepaid incentives
|
| | | | 10,684 | | | | | | — | |
Gain on sale of shares of Orbitz Worldwide
|
| | | | — | | | | | | (6,271) | |
Amortization of debt finance costs and debt discount
|
| | | | 5,126 | | | | | | 5,144 | |
Loss on early extinguishment of debt
|
| | | | 2,671 | | | | | | — | |
Loss (gain) on foreign exchange derivative instruments
|
| | | | 2,451 | | | | | | (8,186) | |
Loss on interest rate derivative instruments
|
| | | | 21,862 | | | | | | — | |
Share of losses in equity method investment
|
| | | | — | | | | | | 175 | |
Equity-based compensation
|
| | | | 16,222 | | | | | | 18,980 | |
Deferred income taxes
|
| | | | 827 | | | | | | 3,934 | |
Customer loyalty payments
|
| | | | (43,922) | | | | | | (42,211) | |
Pension liability contribution
|
| | | | (1,837) | | | | | | (1,550) | |
Changes in assets and liabilities: | | | | |||||||||
Accounts receivable
|
| | | | (37,454) | | | | | | (47,661) | |
Other current assets
|
| | | | (19,072) | | | | | | (5,331) | |
Accounts payable, accrued expenses and other current liabilities
|
| | | | 3,896 | | | | | | (908) | |
Other
|
| | | | (22) | | | | | | 11,608 | |
Net cash provided by operating activities
|
| | | $ | 102,932 | | | | | $ | 92,166 | |
Investing activities | | | | | | | | | | | | |
Property and equipment additions
|
| | | $ | (44,985) | | | | | $ | (52,494) | |
Business acquired, net of cash
|
| | | | (15,009) | | | | | | — | |
Proceeds from sale of shares of Orbitz Worldwide
|
| | | | — | | | | | | 6,271 | |
Net cash used in investing activities
|
| | | $ | (59,994) | | | | | $ | (46,223) | |
|
(in $ thousands)
|
| |
Six Months
Ended June 30, 2016 |
| |
Six Months
Ended June 30, 2015 |
|||||
Financing activities | | | | | | | | | | | |
Proceeds from term loans
|
| | | $ | 143,291 | | | | | $ | — |
Repayment of term loans
|
| | | | (155,166) | | | | | | (11,875) |
Proceeds from revolver borrowings
|
| | | | 10,000 | | | | | | — |
Repayment of revolver borrowings
|
| | | | (10,000) | | | | | | — |
Repayment of capital lease obligations and other indebtedness
|
| | | | (23,542) | | | | | | (16,067) |
Debt finance costs and lender fees
|
| | | | (7,791) | | | | | | — |
Release of cash provided as collateral
|
| | | | — | | | | | | 4,336 |
Dividend to shareholders
|
| | | | (18,565) | | | | | | (18,555) |
Purchase of non-controlling interest in a subsidiary
|
| | | | (7,820) | | | | | | — |
Treasury share purchase related to vesting of equity awards
|
| | | | (1,004) | | | | | | (14,480) |
Net cash used in financing activities
|
| | | $ | (70,597) | | | | | $ | (56,641) |
Effect of changes in exchange rate on cash and cash equivalents
|
| | | | (245) | | | | | | (1,252) |
Net decrease in cash and cash equivalents
|
| | | | (27,904) | | | | | | (11,950) |
Cash and cash equivalents at beginning of period
|
| | | | 154,841 | | | | | | 138,986 |
Cash and cash equivalents at end of period
|
| | | $ | 126,937 | | | | | $ | 127,036 |
Supplemental disclosure of cash flow information | | | | | | | | | | | |
Interest payments, net of capitalized interest
|
| | | | 86,854 | | | | | | 72,732 |
Income tax payments, net of refunds
|
| | | | 8,573 | | | | | | 13,272 |
Non-cash capital leases additions
|
| | | | 7,969 | | | | | | 25,151 |
Non-cash purchase of property and equipment.
|
| | | | — | | | | | | 27,000 |
| | |
Common Shares
|
| |
Additional
Paid in Capital |
| |
Treasury Shares
|
| |
Accumulated
Deficit |
| |
Accumulated
Other Comprehensive Loss |
| |
Non-
Controlling Interest in Subsidiaries |
| |
Total
Equity (Deficit) |
| |||||||||||||||||||||||||||||||||
(in $ thousands, except share data)
|
| |
Number
|
| |
Amount
|
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Number
|
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Amount
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Balance as of December 31, 2015
|
| | | | 124,476,382 | | | | | $ | 311 | | | | | $ | 2,715,538 | | | | | | 844,908 | | | | | $ | (13,331) | | | | | $ | (2,881,658) | | | | | $ | (177,507) | | | | | $ | 33,789 | | | | | $ | (322,858) | | |
Dividend to shareholders ($0.15 per share)
|
| | | | — | | | | | | — | | | | | | (18,996) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (18,996) | | |
Purchase of non-controlling interest in
a subsidiary |
| | | | — | | | | | | — | | | | | | 1,189 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (9,709) | | | | | | (8,520) | | |
Equity-based compensation
|
| | | | 260,007 | | | | | | 1 | | | | | | 17,392 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 17,393 | | |
Treasury shares purchased in relation to vesting of equity awards
|
| | | | — | | | | | | — | | | | | | — | | | | | | 70,362 | | | | | | (1,004) | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,004) | | |
Treasury shares issued in relation to vesting of equity awards
|
| | | | — | | | | | | — | | | | | | (802) | | | | | | (50,969) | | | | | | 802 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Comprehensive income, net of tax
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,754 | | | | | | 7,162 | | | | | | 998 | | | | | | 9,914 | | |
Balance as of June 30, 2016
|
| | | | 124,736,389 | | | | | $ | 312 | | | | | $ | 2,714,321 | | | | | | 864,301 | | | | | $ | (13,533) | | | | | $ | (2,879,904) | | | | | $ | (170,345) | | | | | $ | 25,078 | | | | | $ | (324,071) | | |
|
(in $ thousands)
|
| |
June 30,
2016 |
| |
December 31,
2015 |
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Prepaid expenses
|
| | | $ | 33,739 | | | | | $ | 26,395 | | |
Sales and use tax receivables
|
| | | | 32,722 | | | | | | 27,233 | | |
Prepaid incentives
|
| | | | 21,636 | | | | | | 26,496 | | |
Restricted cash
|
| | | | 17,457 | | | | | | 11,701 | | |
Derivative assets
|
| | | | 2,096 | | | | | | 657 | | |
Other
|
| | | | 9,243 | | | | | | 6,999 | | |
| | | | $ | 116,893 | | | | | $ | 99,481 | | |
|
| | |
June 30, 2016
|
| |
December 31, 2015
|
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(in $ thousands)
|
| |
Cost
|
| |
Accumulated
depreciation |
| |
Net
|
| |
Cost
|
| |
Accumulated
depreciation |
| |
Net
|
| ||||||||||||||||||
Capitalized software
|
| | | $ | 890,817 | | | | | $ | (681,365) | | | | | $ | 209,452 | | | | | $ | 870,868 | | | | | $ | (635,135) | | | | | $ | 235,733 | | |
Computer equipment
|
| | | | 308,878 | | | | | | (187,501) | | | | | | 121,377 | | | | | | 303,902 | | | | | | (168,380) | | | | | | 135,522 | | |
Building and leasehold improvements
|
| | | | 25,597 | | | | | | (9,992) | | | | | | 15,605 | | | | | | 24,102 | | | | | | (8,735) | | | | | | 15,367 | | |
Construction in progress
|
| | | | 83,408 | | | | | | — | | | | | | 83,408 | | | | | | 73,226 | | | | | | — | | | | | | 73,226 | | |
| | | | $ | 1,308,700 | | | | | $ | (878,858) | | | | | $ | 429,842 | | | | | $ | 1,272,098 | | | | | $ | (812,250) | | | | | $ | 459,848 | | |
|
(in $ thousands)
|
| |
January 1,
2016 |
| |
Additions
|
| |
Retirements
|
| |
Foreign
Exchange |
| |
June 30,
2016 |
| |||||||||||||||
Non-Amortizable Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Goodwill
|
| | | $ | 1,067,415 | | | | | $ | 14,105 | | | | | $ | — | | | | | $ | 2,321 | | | | | $ | 1,083,841 | | |
Trademarks and tradenames
|
| | | | 313,961 | | | | | | — | | | | | | — | | | | | | 54 | | | | | | 314,015 | | |
Other Intangible Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Acquired intangible assets
|
| | | | 1,127,360 | | | | | | — | | | | | | — | | | | | | (110) | | | | | | 1,127,250 | | |
Accumulated amortization
|
| | | | (756,489) | | | | | | (24,855) | | | | | | — | | | | | | (348) | | | | | | (781,692) | | |
Acquired intangible assets, net
|
| | | | 370,871 | | | | | | (24,855) | | | | | | — | | | | | | (458) | | | | | | 345,558 | | |
Customer loyalty payments
|
| | | | 300,142 | | | | | | 50,346 | | | | | | (29,359) | | | | | | 1,844 | | | | | | 322,973 | | |
Accumulated amortization
|
| | | | (136,473) | | | | | | (34,261) | | | | | | 27,479 | | | | | | (596) | | | | | | (143,851) | | |
Customer loyalty payments, net
|
| | | | 163,669 | | | | | | 16,085 | | | | | | (1,880) | | | | | | 1,248 | | | | | | 179,122 | | |
Other intangible assets, net
|
| | | $ | 534,540 | | | | | $ | (8,770) | | | | | $ | (1,880) | | | | | $ | 790 | | | | | $ | 524,680 | | |
|
(in $ thousands)
|
| |
January 1,
2015 |
| |
Additions
|
| |
Retirements
|
| |
Foreign
Exchange |
| |
June 30,
2015 |
| |||||||||||||||
Non-Amortizable Assets: | | | | | | | |||||||||||||||||||||||||
Goodwill
|
| | | $ | 997,419 | | | | | $ | — | | | | | $ | — | | | | | $ | (1,092) | | | | | $ | 996,327 | | |
Trademarks and tradenames
|
| | | | 313,961 | | | | | | — | | | | | | — | | | | | | — | | | | | | 313,961 | | |
Other Intangible Assets: | | | | | | | |||||||||||||||||||||||||
Acquired intangible assets
|
| | | | 1,129,320 | | | | | | — | | | | | | (2,535) | | | | | | 507 | | | | | | 1,127,292 | | |
Accumulated amortization
|
| | | | (687,495) | | | | | | (37,765) | | | | | | 2,535 | | | | | | (513) | | | | | | (723,238) | | |
Acquired intangible assets, net
|
| | | | 441,825 | | | | | | (37,765) | | | | | | — | | | | | | (6) | | | | | | 404,054 | | |
Customer loyalty payments
|
| | | | 334,309 | | | | | | 42,840 | | | | | | (43,215) | | | | | | (2,677) | | | | | | 331,257 | | |
Accumulated amortization
|
| | | | (157,319) | | | | | | (36,267) | | | | | | 43,215 | | | | | | — | | | | | | (150,371) | | |
Customer loyalty payments, net
|
| | | | 176,990 | | | | | | 6,573 | | | | | | — | | | | | | (2,677) | | | | | | 180,886 | | |
Other intangible assets, net
|
| | | $ | 618,815 | | | | | $ | (31,192) | | | | | $ | — | | | | | $ | (2,683) | | | | | $ | 584,940 | | |
|
(in $ thousands)
|
| |
June 30,
2016 |
| |
December 31,
2015 |
| ||||||
Supplier prepayments
|
| | | $ | 16,278 | | | | | $ | 14,616 | | |
Prepaid incentives
|
| | | | 9,666 | | | | | | 9,282 | | |
Pension assets
|
| | | | 5,752 | | | | | | 5,186 | | |
Deferred financing costs
|
| | | | 5,652 | | | | | | 6,543 | | |
Derivative assets
|
| | | | — | | | | | | 8,655 | | |
Other
|
| | | | 10,758 | | | | | | 9,894 | | |
| | | | $ | 48,106 | | | | | $ | 54,176 | | |
|
(in $ thousands)
|
| |
June 30,
2016 |
| |
December 31,
2015 |
| ||||||
Accrued commissions and incentives
|
| | | $ | 273,927 | | | | | $ | 241,358 | | |
Accrued payroll and related
|
| | | | 62,352 | | | | | | 77,544 | | |
Deferred revenue
|
| | | | 42,116 | | | | | | 35,836 | | |
Income tax payable
|
| | | | 18,227 | | | | | | 15,516 | | |
Customer prepayments
|
| | | | 17,457 | | | | | | 11,701 | | |
Derivative liabilities
|
| | | | 13,618 | | | | | | 10,341 | | |
Accrued interest expense
|
| | | | 2,997 | | | | | | 18,800 | | |
Pension and post-retirement benefit liabilities
|
| | | | 1,448 | | | | | | 1,528 | | |
Other
|
| | | | 19,140 | | | | | | 18,026 | | |
| | | | $ | 451,282 | | | | | $ | 430,650 | | |
|
(in $ thousands)
|
| |
Interest
rate |
| |
Maturity
|
| |
June 30,
2016 |
| |
December 31,
2015 |
| |||||||||
Senior Secured Credit Agreement | | | | | | | | | | | | | | | | | | | | | | |
Term loans
|
| | | | | |||||||||||||||||
Dollar denominated(1)(2)(3)
|
| | | | L+4.00% | | | |
September 2021
|
| | | $ | 2,292,472 | | | | | $ | 2,303,315 | | |
Revolver borrowings
|
| | | | | |||||||||||||||||
Dollar denominated
|
| | | | L+5.00% | | | |
September 2019
|
| | | | — | | | | | | — | | |
Capital leases and other indebtedness
|
| | | | | | | | | | | | | 118,310 | | | | | | 133,883 | | |
Total debt
|
| | | | | | | | | | | | | 2,410,782 | | | | | | 2,437,198 | | |
Less: current portion
|
| | | | | | | | | | | | | 64,086 | | | | | | 74,163 | | |
Long-term debt
|
| | | | | | | | | | | | $ | 2,346,696 | | | | | $ | 2,363,035 | | |
|
(in $ thousands)
|
| |
Balance Sheet
Location |
| |
Fair Value Asset
|
| |
Balance Sheet
Location |
| |
Fair Value (Liability)
|
| ||||||||||||||||||
|
June 30,
2016 |
| |
December 31,
2015 |
| |
June 30,
2016 |
| |
December 31,
2015 |
| ||||||||||||||||||||
Interest
rate swap contracts |
| | Other current assets |
| | | $ | — | | | | | $ | — | | | | Accrued Expenses and other current liabilities |
| | | $ | (2,401) | | | | | $ | — | | |
Interest
rate swap contracts |
| | Other non-current assets |
| | | | — | | | | | | 8,655 | | | | Other non-current liabilities |
| | | | (10,806) | | | | | | — | | |
Foreign
currency contracts |
| | Other current assets |
| | | | 2,096 | | | | | | 657 | | | | Accrued Expenses and other current liabilities |
| | | | (11,217) | | | | | | (10,341) | | |
Foreign
currency contracts |
| | Other non-current assets |
| | | | — | | | | | | — | | | | Other non-current liabilities |
| | | | (4,066) | | | | | | (1,082) | | |
Total fair value of derivative assets (liabilities)
|
| | | | | | $ | 2,096 | | | | | $ | 9,312 | | | | | | | | $ | (28,490) | | | | | $ | (11,423) | | |
|
(in $ thousands)
|
| |
Six Months Ended
June 30, 2016 |
| |
Six Months Ended
June 30, 2015 |
|||||
Net derivative liability opening balance
|
| | | $ | (2,111) | | | | | $ | (15,548) |
Total loss for the period included in net income
|
| | | | (34,560) | | | | | | (5,426) |
Payment on settlement of foreign currency derivative contracts
|
| | | | 10,277 | | | | | | 13,501 |
Net derivative liability closing balance
|
| | | $ | (26,394) | | | | | $ | (7,473) |
|
| | | | | |
Amount of Income (Loss)
Recorded in Net (Loss) Income |
| |||||||||||||||||||||
(in $ thousands)
|
| |
Statement of Operations Location
|
| |
Three Months Ended
June 30, |
| |
Six Months Ended
June 30, |
| ||||||||||||||||||
| | | | | |
2016
|
| |
2015
|
| |
2016
|
| |
2015
|
| ||||||||||||
Interest rate swap contracts
|
| | Interest expense, net | | | | $ | (5,406) | | | | | $ | — | | | | | $ | (21,862) | | | | | $ | — | | |
Foreign currency
contracts |
| |
Selling, general and administrative
|
| | | | (14,549) | | | | | | 11,031 | | | | | | (12,698) | | | | | | (5,426) | | |
| | | | | | | $ | (19,955) | | | | | $ | 11,031 | | | | | $ | (34,560) | | | | | $ | (5,426) | | |
|
| | | | | |
June 30, 2016
|
| |
December 31, 2015
|
| ||||||||||||||||||
(in $ thousands)
|
| |
Fair Value
Hierarchy |
| |
Carrying
Amount |
| |
Fair
Value |
| |
Carrying
Amount |
| |
Fair
Value |
| ||||||||||||
Asset (liability) | | | | | | | ||||||||||||||||||||||
Derivative assets(1)
|
| |
Level 3
|
| | | | 2,096 | | | | | | 2,096 | | | | | | 9,312 | | | | | | 9,312 | | |
Derivative liabilities(1)
|
| |
Level 3
|
| | | | (28,490) | | | | | | (28,490) | | | | | | (11,423) | | | | | | (11,423) | | |
Total debt
|
| |
Level 2
|
| | | | (2,410,782) | | | | | | (2,451,346) | | | | | | (2,437,198) | | | | | | (2,431,242) | | |
Declaration Date
|
| |
Dividend
Per Share |
| |
Record
Date |
| |
Payment
Date |
| |
Amount
(in $ thousands) |
| ||||||
February 17, 2016
|
| | | $ | 0.075 | | | |
March 3, 2016
|
| |
March 17, 2016
|
| | | $ | 9,279 | | |
May 3, 2016
|
| | | $ | 0.075 | | | |
June 2, 2016
|
| |
June 16, 2016
|
| | | $ | 9,286 | | |
| | |
Restricted Units
|
| |||||||||
(in dollars, except number of Restricted Units)
|
| |
Number
|
| |
Weighted
Average Grant Date Fair Value |
| ||||||
Balance as of January 1, 2016
|
| | | | 2,172,529 | | | | | $ | 15.73 | | |
Granted at fair market value
|
| | | | 1,746,421 | | | | | $ | 13.23 | | |
Vested(1) | | | | | (206,216) | | | | | $ | 15.62 | | |
Forfeited
|
| | | | (218,025) | | | | | $ | 16.33 | | |
Balance as of June 30, 2016
|
| | | | 3,494,709 | | | | | $ | 14.45 | | |
|
| | |
Stock Options
|
| |||||||||
(in dollars, except number of stock options)
|
| |
Number
|
| |
Weighted
Average Grant Date Fair Value |
| ||||||
Balance as of January 1, 2016
|
| | | | 1,454,638 | | | | | $ | 6.49 | | |
Granted at fair market value
|
| | | | 1,347,066 | | | | | $ | 4.04 | | |
Forfeited
|
| | | | (127,611) | | | | | $ | 6.35 | | |
Expired
|
| | | | (73,010) | | | | | $ | 6.43 | | |
Balance as of June 30, 2016
|
| | | | 2,601,083 | | | | | $ | 5.23 | | |
|
| | |
Three Months Ended
June 30, |
| |
Six Months Ended
June 30, |
| ||||||||||||||||||
(in $ thousand, except share data)
|
| |
2016
|
| |
2015
|
| |
2016
|
| |
2015
|
| ||||||||||||
Numerator – Basic and Diluted (Loss) Income per Share:
|
| | | | | ||||||||||||||||||||
Net (loss) income attributable to the Company
|
| | | $ | (14,831) | | | | | $ | 15,328 | | | | | $ | 1,754 | | | | | $ | 7,187 | | |
Denominator – Basic (Loss) Income per Share:
|
| | | | | ||||||||||||||||||||
Weighted average common shares outstanding
|
| | | | 123,825,030 | | | | | | 122,269,482 | | | | | | 123,771,642 | | | | | | 121,842,792 | | |
(Loss) income per share – Basic
|
| | | $ | (0.12) | | | | | $ | 0.13 | | | | | $ | 0.01 | | | | | $ | 0.06 | | |
Denominator – Diluted (Loss) Income per Share:
|
| | | | | ||||||||||||||||||||
Number of common shares used for basic (loss) income per share
|
| | | | 123,825,030 | | | | | | 122,269,482 | | | | | | 123,771,642 | | | | | | 121,842,792 | | |
Weighted average effect of dilutive securities
|
| | | | | ||||||||||||||||||||
RSUs
|
| | | | 70,030 | | | | | | 365,951 | | | | | | 64,467 | | | | | | 770,326 | | |
Stock Options
|
| | | | 95,117 | | | | | | 82,464 | | | | | | 76,572 | | | | | | 59,645 | | |
Weighted average common shares outstanding
|
| | | | 123,990,177 | | | | | | 122,717,897 | | | | | | 123,912,681 | | | | | | 122,672,763 | | |
(Loss) income per share – Diluted
|
| | | $ | (0.12) | | | | | $ | 0.12 | | | | | $ | 0.01 | | | | | $ | 0.06 | | |
|
(in $ thousands, except per share data,
Reported Segments and RevPas) |
| |
Three Months
Ended June 30, |
| |
Change
|
| |
Six Months
Ended June 30, |
| |
Change
|
| ||||||||||||||||||||||||||||||||||||
|
2016
|
| |
2015
|
| | | | | | | |
%
|
| |
2016
|
| |
2015
|
| | | | | | | |
%
|
| ||||||||||||||||||||
Net revenue
|
| | | $ | 605,905 | | | | | $ | 554,202 | | | | | $ | 51,703 | | | | | | 9 | | | | | $ | 1,215,168 | | | | | $ | 1,126,330 | | | | | $ | 88,838 | | | | | | 8 | | |
Operating income
|
| | | | 37,760 | | | | | | 63,146 | | | | | | (25,386) | | | | | | (40) | | | | | | 117,628 | | | | | | 96,895 | | | | | | 20,733 | | | | | | 21 | | |
Net (loss) income
|
| | | | (14,429) | | | | | | 16,409 | | | | | | (30,838) | | | | | | (188) | | | | | | 2,752 | | | | | | 9,301 | | | | | | (6,549) | | | | | | (70) | | |
(Loss) income per share – diluted
(in $) |
| | | | (0.12) | | | | | | 0.12 | | | | | | (0.24) | | | | | | (200) | | | | | | 0.01 | | | | | | 0.06 | | | | | | (0.05) | | | | | | (83) | | |
Adjusted EBITDA(1)
|
| | | | 139,013 | | | | | | 136,986 | | | | | | 2,027 | | | | | | 1 | | | | | | 293,153 | | | | | | 274,444 | | | | | | 18,709 | | | | | | 7 | | |
Adjusted Operating Income(2)
|
| | | | 82,796 | | | | | | 80,343 | | | | | | 2,453 | | | | | | 3 | | | | | | 179,260 | | | | | | 157,067 | | | | | | 22,193 | | | | | | 14 | | |
Adjusted Net Income(3)
|
| | | | 34,287 | | | | | | 35,487 | | | | | | (1,200) | | | | | | (3) | | | | | | 85,242 | | | | | | 65,064 | | | | | | 20,178 | | | | | | 31 | | |
Adjusted Income per Share – diluted(4) (in $)
|
| | | | 0.28 | | | | | | 0.29 | | | | | | (0.01) | | | | | | (3) | | | | | | 0.69 | | | | | | 0.53 | | | | | | 0.16 | | | | | | 30 | | |
Net cash provided by operating activities
|
| | | | 76,728 | | | | | | 81,147 | | | | | | (4,419) | | | | | | (5) | | | | | | 102,932 | | | | | | 92,166 | | | | | | 10,766 | | | | | | 12 | | |
Adjusted Free Cash Flow(5)
|
| | | | 52,343 | | | | | | 53,701 | | | | | | (1,358) | | | | | | (3) | | | | | | 47,273 | | | | | | 32,683 | | | | | | 14,590 | | | | | | 45 | | |
Reported Segments (in thousands)
|
| | | | 86,807 | | | | | | 87,150 | | | | | | (343) | | | | | | — | | | | | | 176,780 | | | | | | 181,670 | | | | | | (4,890) | | | | | | (3) | | |
Travel Commerce Platform RevPas (in $)
|
| | | $ | 6.61 | | | | | $ | 6.00 | | | | | $ | 0.61 | | | | | | 10 | | | | | $ | 6.52 | | | | | $ | 5.86 | | | | | $ | 0.66 | | | | | | 11 | | |
| | |
Three Months
Ended June 30, |
| |
Six Months
Ended June 30, |
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
2016
|
| |
2015
|
| ||||||||||||
Net (loss) income
|
| | | $ | (14,429) | | | | | $ | 16,409 | | | | | $ | 2,752 | | | | | $ | 9,301 | | |
Adjustments: | | | | | | ||||||||||||||||||||
Amortization of intangible assets(1)
|
| | | | 13,716 | | | | | | 19,142 | | | | | | 24,855 | | | | | | 37,765 | | |
Loss on early extinguishment of debt
|
| | | | 2,671 | | | | | | — | | | | | | 2,671 | | | | | | — | | |
Share of losses in equity method investment
|
| | | | — | | | | | | 194 | | | | | | — | | | | | | 175 | | |
Gain on sale of shares of Orbitz Worldwide
|
| | | | — | | | | | | — | | | | | | — | | | | | | (6,271) | | |
Equity-based compensation and related taxes
|
| | | | 6,823 | | | | | | 8,621 | | | | | | 15,924 | | | | | | 21,023 | | |
Corporate and restructuring costs(2)
|
| | | | 6,870 | | | | | | 6,454 | | | | | | 14,279 | | | | | | 8,068 | | |
Other – non cash(3)
|
| | | | 23,033 | | | | | | (17,020) | | | | | | 28,436 | | | | | | (6,684) | | |
Tax impact of adjustments(4)
|
| | | | (4,397) | | | | | | 1,687 | | | | | | (3,675) | | | | | | 1,687 | | |
Adjusted Net Income
|
| | | | 34,287 | | | | | | 35,487 | | | | | | 85,242 | | | | | | 65,064 | | |
Adjustments: | | | | | | ||||||||||||||||||||
Interest expense, net(5)
|
| | | | 39,707 | | | | | | 38,751 | | | | | | 78,146 | | | | | | 78,140 | | |
Remaining provision for income taxes
|
| | | | 8,802 | | | | | | 6,105 | | | | | | 15,872 | | | | | | 13,863 | | |
Adjusted Operating Income
|
| | | | 82,796 | | | | | | 80,343 | | | | | | 179,260 | | | | | | 157,067 | | |
Adjustments: | | | | | | ||||||||||||||||||||
Depreciation and amortization of property and equipment
|
| | | | 38,530 | | | | | | 38,705 | | | | | | 79,632 | | | | | | 81,110 | | |
Amortization of customer loyalty payments
|
| | | | 17,687 | | | | | | 17,938 | | | | | | 34,261 | | | | | | 36,267 | | |
Adjusted EBITDA
|
| | | $ | 139,013 | | | | | $ | 136,986 | | | | | $ | 293,153 | | | | | $ | 274,444 | | |
|
| | |
Three Months
Ended June 30, |
| |
Six Months
Ended June 30, |
| ||||||||||||||||||
| | |
2016
|
| |
2015
|
| |
2016
|
| |
2015
|
| ||||||||||||
(Loss) income per share – diluted
|
| | | $ | (0.12) | | | | | $ | 0.12 | | | | | $ | 0.01 | | | | | $ | 0.06 | | |
Per share adjustments to net (loss) income to determine Adjusted Income
per Share – diluted |
| | | | 0.40 | | | | | | 0.17 | | | | | | 0.68 | | | | | | 0.47 | | |
Adjusted Income per Share – diluted
|
| | | $ | 0.28 | | | | | $ | 0.29 | | | | | $ | 0.69 | | | | | $ | 0.53 | | |
|
| | |
Six Months Ended
June 30, |
| |||||||||
(in percentages)
|
| |
2016
|
| |
2015
|
| ||||||
Asia Pacific
|
| | | | 22 | | | | | | 22 | | |
Europe
|
| | | | 33 | | | | | | 30 | | |
Latin America and Canada
|
| | | | 5 | | | | | | 4 | | |
Middle East and Africa
|
| | | | 13 | | | | | | 14 | | |
International
|
| | | | 73 | | | | | | 70 | | |
United States
|
| | | | 27 | | | | | | 30 | | |
Travel Commerce Platform
|
| | | | 100 | | | | | | 100 | | |
|
| | |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Net revenue
|
| | | $ | 605,905 | | | | | $ | 554,202 | | | | | $ | 51,703 | | | | | | 9 | | |
Costs and expenses | | | | | | ||||||||||||||||||||
Cost of revenue
|
| | | | 376,605 | | | | | | 335,050 | | | | | | 41,555 | | | | | | 12 | | |
Selling, general and administrative
|
| | | | 139,294 | | | | | | 98,159 | | | | | | 41,135 | | | | | | 42 | | |
Depreciation and amortization
|
| | | | 52,246 | | | | | | 57,847 | | | | | | (5,601) | | | | | | (10) | | |
Total costs and expenses
|
| | | | 568,145 | | | | | | 491,056 | | | | | | 77,089 | | | | | | 16 | | |
Operating income
|
| | | | 37,760 | | | | | | 63,146 | | | | | | (25,386) | | | | | | (40) | | |
Interest expense, net
|
| | | | (45,113) | | | | | | (38,751) | | | | | | (6,362) | | | | | | (16) | | |
Loss on early extinguishment of debt
|
| | | | (2,671) | | | | | | — | | | | | | (2,671) | | | | | | * | | |
(Loss) income before income taxes and share of losses in equity method investment
|
| | | | (10,024) | | | | | | 24,395 | | | | | | (34,419) | | | | | | (141) | | |
Provision for income taxes
|
| | | | (4,405) | | | | | | (7,792) | | | | | | 3,387 | | | | | | 43 | | |
Share of losses in equity method investment
|
| | | | — | | | | | | (194) | | | | | | 194 | | | | | | 100 | | |
Net (loss) income
|
| | | $ | (14,429) | | | | | $ | 16,409 | | | | | $ | (30,838) | | | | | | (188) | | |
|
| | |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Air
|
| | | $ | 425,861 | | | | | $ | 400,974 | | | | | $ | 24,887 | | | | | | 6 | | |
Beyond Air
|
| | | | 148,197 | | | | | | 121,700 | | | | | | 26,497 | | | | | | 22 | | |
Travel Commerce Platform
|
| | | | 574,058 | | | | | | 522,674 | | | | | | 51,384 | | | | | | 10 | | |
Technology Services
|
| | | | 31,847 | | | | | | 31,528 | | | | | | 319 | | | | | | 1 | | |
Net revenue
|
| | | $ | 605,905 | | | | | $ | 554,202 | | | | | $ | 51,703 | | | | | | 9 | | |
|
| | |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
| | |
2016
|
| |
2015
|
| | | | | | | |
%
|
| |||||||||
Travel Commerce Platform RevPas (in $)
|
| | | $ | 6.61 | | | | | $ | 6.00 | | | | | $ | 0.61 | | | | | | 10 | | |
Reported Segments (in thousands)
|
| | | | 86,807 | | | | | | 87,150 | | | | | | (343) | | | | | | — | | |
| | |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Asia Pacific
|
| | | $ | 130,526 | | | | | $ | 115,397 | | | | | $ | 15,129 | | | | | | 13 | | |
Europe
|
| | | | 182,710 | | | | | | 149,913 | | | | | | 32,797 | | | | | | 22 | | |
Latin America and Canada
|
| | | | 28,245 | | | | | | 24,299 | | | | | | 3,946 | | | | | | 16 | | |
Middle East and Africa
|
| | | | 77,346 | | | | | | 74,625 | | | | | | 2,721 | | | | | | 4 | | |
International
|
| | | | 418,827 | | | | | | 364,234 | | | | | | 54,593 | | | | | | 15 | | |
United States
|
| | | | 155,231 | | | | | | 158,440 | | | | | | (3,209) | | | | | | (2) | | |
Travel Commerce Platform
|
| | | $ | 574,058 | | | | | $ | 522,674 | | | | | $ | 51,384 | | | | | | 10 | | |
|
| | |
Segments (in thousands)
|
| |
RevPas (in $)
|
| ||||||||||||||||||||||||||||||||||||||||||
| | |
Three Months Ended
June 30, |
| |
Change
|
| |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||||||||||||||||||||
| | |
2016
|
| |
2015
|
| | | | | | | |
%
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| |||||||||||||||||||||
Asia Pacific
|
| | | | 17,009 | | | | | | 16,042 | | | | | | 967 | | | | | | 6 | | | | | $ | 7.67 | | | | | $ | 7.19 | | | | | $ | 0.48 | | | | | | 7 | | |
Europe
|
| | | | 20,561 | | | | | | 20,080 | | | | | | 481 | | | | | | 2 | | | | | $ | 8.89 | | | | | $ | 7.47 | | | | | $ | 1.42 | | | | | | 19 | | |
Latin America and Canada
|
| | | | 4,524 | | | | | | 4,210 | | | | | | 314 | | | | | | 7 | | | | | $ | 6.24 | | | | | $ | 5.77 | | | | | $ | 0.47 | | | | | | 8 | | |
Middle East and Africa
|
| | | | 9,912 | | | | | | 9,921 | | | | | | (9) | | | | | | — | | | | | $ | 7.80 | | | | | $ | 7.51 | | | | | $ | 0.29 | | | | | | 4 | | |
International
|
| | | | 52,006 | | | | | | 50,253 | | | | | | 1,753 | | | | | | 3 | | | | | $ | 8.05 | | | | | $ | 7.25 | | | | | $ | 0.80 | | | | | | 11 | | |
United States
|
| | | | 34,801 | | | | | | 36,897 | | | | | | (2,096) | | | | | | (6) | | | | | $ | 4.46 | | | | | $ | 4.30 | | | | | $ | 0.16 | | | | | | 4 | | |
Travel Commerce Platform
|
| | | | 86,807 | | | | | | 87,150 | | | | | | (343) | | | | | | — | | | | | $ | 6.61 | | | | | $ | 6.00 | | | | | $ | 0.61 | | | | | | 10 | | |
|
| | |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Commissions
|
| | | $ | 292,714 | | | | | $ | 258,830 | | | | | $ | 33,884 | | | | | | 13 | | |
Technology costs
|
| | | | 83,891 | | | | | | 76,220 | | | | | | 7,671 | | | | | | 10 | | |
Cost of revenue
|
| | | $ | 376,605 | | | | | $ | 335,050 | | | | | $ | 41,555 | | | | | | 12 | | |
|
| | |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Workforce
|
| | | $ | 88,536 | | | | | $ | 71,655 | | | | | $ | 16,881 | | | | | | 24 | | |
Non-workforce
|
| | | | 19,438 | | | | | | 28,449 | | | | | | (9,011) | | | | | | (32) | | |
Sub-total
|
| | | | 107,974 | | | | | | 100,104 | | | | | | 7,870 | | | | | | 8 | | |
Non-core corporate costs
|
| | | | 31,320 | | | | | | (1,945) | | | | | | 33,265 | | | | | | * | | |
SG&A | | | | $ | 139,294 | | | | | $ | 98,159 | | | | | $ | 41,135 | | | | | | 42 | | |
|
| | |
Three Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Depreciation on property and equipment
|
| | | $ | 38,530 | | | | | $ | 38,705 | | | | | $ | (175) | | | | | | — | | |
Amortization of acquired intangible assets
|
| | | | 13,716 | | | | | | 19,142 | | | | | | (5,426) | | | | | | (28) | | |
Total depreciation and amortization
|
| | | $ | 52,246 | | | | | $ | 57,847 | | | | | $ | (5,601) | | | | | | (10) | | |
|
| | |
Six Months Ended June 30,
|
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Net revenue
|
| | | $ | 1,215,168 | | | | | $ | 1,126,330 | | | | | $ | 88,838 | | | | | | 8 | | |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenue
|
| | | | 739,282 | | | | | | 684,281 | | | | | | 55,001 | | | | | | 8 | | |
Selling, general and administrative
|
| | | | 253,771 | | | | | | 226,279 | | | | | | 27,492 | | | | | | 12 | | |
Depreciation and amortization
|
| | | | 104,487 | | | | | | 118,875 | | | | | | (14,388) | | | | | | (12) | | |
Total costs and expenses
|
| | | | 1,097,540 | | | | | | 1,029,435 | | | | | | 68,105 | | | | | | 7 | | |
Operating income
|
| | | | 117,628 | | | | | | 96,895 | | | | | | 20,733 | | | | | | 21 | | |
Interest expense, net
|
| | | | (100,008) | | | | | | (78,140) | | | | | | (21,868) | | | | | | (28) | | |
Loss on early extinguishment of debt
|
| | | | (2,671) | | | | | | — | | | | | | (2,671) | | | | | | * | | |
Gain on sale of shares of Orbitz Worldwide
|
| | | | — | | | | | | 6,271 | | | | | | (6,271) | | | | | | (100) | | |
Income before income taxes and share of losses in equity method investment
|
| | | | 14,949 | | | | | | 25,026 | | | | | | (10,077) | | | | | | (40) | | |
Provision for income taxes
|
| | | | (12,197) | | | | | | (15,550) | | | | | | 3,353 | | | | | | 22 | | |
Share of losses in equity method investment
|
| | | | — | | | | | | (175) | | | | | | 175 | | | | | | 100 | | |
Net income
|
| | | $ | 2,752 | | | | | $ | 9,301 | | | | | $ | (6,549) | | | | | | (70) | | |
|
| | |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Air
|
| | | $ | 869,745 | | | | | $ | 832,495 | | | | | $ | 37,250 | | | | | | 4 | | |
Beyond Air
|
| | | | 283,199 | | | | | | 231,820 | | | | | | 51,379 | | | | | | 22 | | |
Travel Commerce Platform
|
| | | | 1,152,944 | | | | | | 1,064,315 | | | | | | 88,629 | | | | | | 8 | | |
Technology Services
|
| | | | 62,224 | | | | | | 62,015 | | | | | | 209 | | | | | | — | | |
Net revenue
|
| | | $ | 1,215,168 | | | | | $ | 1,126,330 | | | | | $ | 88,838 | | | | | | 8 | | |
|
| | |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
| | |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Travel Commerce Platform RevPas (in $)
|
| | | $ | 6.52 | | | | | $ | 5.86 | | | | | $ | 0.66 | | | | | | 11 | | |
Reported Segments (in thousands)
|
| | | | 176,780 | | | | | | 181,670 | | | | | | (4,890) | | | | | | (3) | | |
| | |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Asia Pacific
|
| | | $ | 259,021 | | | | | $ | 233,170 | | | | | $ | 25,851 | | | | | | 11 | | |
Europe
|
| | | | 377,557 | | | | | | 315,640 | | | | | | 61,917 | | | | | | 20 | | |
Latin America and Canada
|
| | | | 56,281 | | | | | | 48,060 | | | | | | 8,221 | | | | | | 17 | | |
Middle East and Africa
|
| | | | 150,796 | | | | | | 147,948 | | | | | | 2,848 | | | | | | 2 | | |
International
|
| | | | 843,655 | | | | | | 744,818 | | | | | | 98,837 | | | | | | 13 | | |
United States
|
| | | | 309,289 | | | | | | 319,497 | | | | | | (10,208) | | | | | | (3) | | |
Travel Commerce Platform
|
| | | $ | 1,152,944 | | | | | $ | 1,064,315 | | | | | $ | 88,629 | | | | | | 8 | | |
|
| | |
Segments (in thousands)
|
| |
RevPas (in $)
|
| ||||||||||||||||||||||||||||||||||||||||||
| | |
Six Months Ended
June 30, |
| |
Change
|
| |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||||||||||||||||||||
| | |
2016
|
| |
2015
|
| | | | | | | |
%
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| |||||||||||||||||||||
Asia Pacific
|
| | | | 33,998 | | | | | | 32,761 | | | | | | 1,237 | | | | | | 4 | | | | | $ | 7.62 | | | | | $ | 7.12 | | | | | $ | 0.50 | | | | | | 7 | | |
Europe
|
| | | | 43,694 | | | | | | 43,069 | | | | | | 625 | | | | | | 1 | | | | | $ | 8.64 | | | | | $ | 7.33 | | | | | $ | 1.31 | | | | | | 18 | | |
Latin America and Canada
|
| | | | 9,074 | | | | | | 8,481 | | | | | | 593 | | | | | | 7 | | | | | $ | 6.20 | | | | | $ | 5.67 | | | | | $ | 0.53 | | | | | | 9 | | |
Middle East and Africa
|
| | | | 19,633 | | | | | | 19,850 | | | | | | (217) | | | | | | (1) | | | | | $ | 7.68 | | | | | $ | 7.45 | | | | | $ | 0.23 | | | | | | 3 | | |
International
|
| | | | 106,399 | | | | | | 104,161 | | | | | | 2,238 | | | | | | 2 | | | | | $ | 7.93 | | | | | $ | 7.15 | | | | | $ | 0.78 | | | | | | 11 | | |
United States
|
| | | | 70,381 | | | | | | 77,509 | | | | | | (7,128) | | | | | | (9) | | | | | $ | 4.39 | | | | | $ | 4.12 | | | | | $ | 0.27 | | | | | | 7 | | |
Travel Commerce Platform
|
| | | | 176,780 | | | | | | 181,670 | | | | | | (4,890) | | | | | | (3) | | | | | $ | 6.52 | | | | | $ | 5.86 | | | | | $ | 0.66 | | | | | | 11 | | |
|
| | |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Commissions
|
| | | $ | 574,756 | | | | | $ | 528,899 | | | | | $ | 45,857 | | | | | | 9 | | |
Technology costs
|
| | | | 164,526 | | | | | | 155,382 | | | | | | 9,144 | | | | | | 6 | | |
Cost of revenue
|
| | | $ | 739,282 | | | | | $ | 684,281 | | | | | $ | 55,001 | | | | | | 8 | | |
|
| | |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Workforce
|
| | | $ | 173,095 | | | | | $ | 151,894 | | | | | $ | 21,201 | | | | | | 14 | | |
Non-workforce
|
| | | | 43,899 | | | | | | 51,978 | | | | | | (8,079) | | | | | | (16) | | |
Sub-total
|
| | | | 216,994 | | | | | | 203,872 | | | | | | 13,122 | | | | | | 6 | | |
Non-core corporate costs
|
| | | | 36,777 | | | | | | 22,407 | | | | | | 14,370 | | | | | | 64 | | |
SG&A | | | | $ | 253,771 | | | | | $ | 226,279 | | | | | $ | 27,492 | | | | | | 12 | | |
|
| | |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |
%
|
| ||||||||||||
Depreciation on property and equipment
|
| | | $ | 79,632 | | | | | $ | 81,110 | | | | | $ | (1,478) | | | | | | (2) | | |
Amortization of acquired intangible assets
|
| | | | 24,855 | | | | | | 37,765 | | | | | | (12,910) | | | | | | (34) | | |
Total depreciation and amortization
|
| | | $ | 104,487 | | | | | $ | 118,875 | | | | | $ | (14,388) | | | | | | (12) | | |
|
(in $ thousands)
|
| |
June 30,
2016 |
| |||
Cash and cash equivalents
|
| | | $ | 126,937 | | |
Revolving credit facility availability
|
| | | | 101,194 | | |
| | |
Asset (Liability)
|
| | ||||||||||||||
(in $ thousands)
|
| |
June 30,
2016 |
| |
December 31,
2015 |
| |
Change
|
| |||||||||
Accounts Receivable, net
|
| | | $ | 241,526 | | | | | $ | 205,686 | | | | | $ | 35,840 | | |
Accrued commissions and incentives
|
| | | | (273,927) | | | | | | (241,358) | | | | | | (32,569) | | |
Deferred revenue and prepaid incentives, net
|
| | | | (20,480) | | | | | | (9,340) | | | | | | (11,140) | | |
Cash and cash equivalents
|
| | | | 126,937 | | | | | | 154,841 | | | | | | (27,904) | | |
Accounts payable and employee related
|
| | | | (131,833) | | | | | | (153,349) | | | | | | 21,516 | | |
Accrued interest
|
| | | | (2,997) | | | | | | (18,800) | | | | | | 15,803 | | |
Current portion of long-term debt
|
| | | | (64,086) | | | | | | (74,163) | | | | | | 10,077 | | |
Taxes
|
| | | | 19,613 | | | | | | 16,850 | | | | | | 2,763 | | |
Other assets (liabilities), net
|
| | | | 12,320 | | | | | | 5,684 | | | | | | 6,636 | | |
Working Capital
|
| | | $ | (92,927) | | | | | $ | (113,949) | | | | | $ | 21,022 | | |
Consolidated Condensed Balance Sheets: | | | | | |||||||||||||||
Total current assets
|
| | | $ | 490,474 | | | | | $ | 465,141 | | | | | $ | 25,333 | | |
Total current liabilities
|
| | | | (583,401) | | | | | | (579,090) | | | | | | (4,311) | | |
Working Capital
|
| | | $ | (92,927) | | | | | $ | (113,949) | | | | | $ | 21,022 | | |
|
| | |
June 30,
2016 |
| |
December 31,
2015 |
| |
Change
|
| |||||||||
Accounts receivable, net (in $ thousands)
|
| | | $ | 241,526 | | | | | $ | 205,686 | | | | | $ | 35,840 | | |
Accounts receivable, net – Days Sales Outstanding (“DSO”)
|
| | | | 36 | | | | | | 38 | | | | | | (2) | | |
| | |
Six Months Ended
June 30, |
| |
Change
|
| ||||||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| |
$
|
| |||||||||
Cash provided by (used in): | | | | | |||||||||||||||
Operating activities
|
| | | $ | 102,932 | | | | | $ | 92,166 | | | | | $ | 10,766 | | |
Investing activities
|
| | | | (59,994) | | | | | | (46,223) | | | | | | (13,771) | | |
Financing activities
|
| | | | (70,597) | | | | | | (56,641) | | | | | | (13,956) | | |
Effect of exchange rate changes
|
| | | | (245) | | | | | | (1,252) | | | | | | 1,007 | | |
Net decrease in cash and cash equivalents
|
| | | $ | (27,904) | | | | | $ | (11,950) | | | | | $ | (15,954) | | |
|
| | |
Six Months Ended,
June 30, |
| |||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| ||||||
Adjusted EBITDA
|
| | | $ | 293,153 | | | | | $ | 274,444 | | |
Interest payments
|
| | | | (86,854) | | | | | | (72,732) | | |
Tax payments
|
| | | | (8,573) | | | | | | (13,272) | | |
Customer loyalty payments
|
| | | | (43,922) | | | | | | (42,211) | | |
Changes in working capital
|
| | | | (30,525) | | | | | | (53,392) | | |
Pensions liability contribution
|
| | | | (1,837) | | | | | | (1,550) | | |
Changes in other assets and liabilities
|
| | | | (5,642) | | | | | | 9,957 | | |
Other adjusting items(1)
|
| | | | (12,868) | | | | | | (9,078) | | |
Net cash provided by operating activities
|
| | | | 102,932 | | | | | | 92,166 | | |
Add: other adjusting items(1)
|
| | | | 12,868 | | | | | | 9,078 | | |
Less: capital expenditures on property and equipment additions
|
| | | | (44,985) | | | | | | (52,494) | | |
Less: repayment of capital lease obligations and other indebtedness
|
| | | | (23,542) | | | | | | (16,067) | | |
Adjusted Free Cash Flow
|
| | | $ | 47,273 | | | | | $ | 32,683 | | |
|
| | |
Six Months Ended
June 30, |
| |||||||||
(in $ thousands)
|
| |
2016
|
| |
2015
|
| ||||||
Cash additions to software developed for internal use
|
| | | $ | 36,452 | | | | | $ | 37,452 | | |
Cash additions to computer equipment
|
| | | | 8,533 | | | | | | 15,042 | | |
Total | | | | $ | 44,985 | | | | | $ | 52,494 | | |
|
(in $ thousands)
|
| |
Interest
rate |
| |
Maturity
|
| |
June 30,
2016 |
| |
December 31,
2015 |
| ||||||
Senior Secured Credit Agreement | | | | | | ||||||||||||||
Term loans
|
| | | | | ||||||||||||||
Dollar denominated(1)(2)(3)
|
| |
L+4.00%
|
| |
September 2021
|
| | | $ | 2,292,472 | | | | | $ | 2,303,315 | | |
Revolver borrowings
|
| | | | | ||||||||||||||
Dollar denominated
|
| |
L+5.00%
|
| |
September 2019
|
| | | | — | | | | | | — | | |
Capital leases and other indebtedness
|
| | | | | | | | | | 118,310 | | | | | | 133,883 | | |
Total debt
|
| | | | | | | | | | 2,410,782 | | | | | | 2,437,198 | | |
Less: cash and cash equivalents
|
| | | | | | | | | | (126,937) | | | | | | (154,841) | | |
Net Debt(3)
|
| | | | | | | | | $ | 2,283,845 | | | | | $ | 2,282,357 | | |
|
| | | | TRAVELPORT WORLDWIDE LIMITED | |
| Date: August 4, 2016 | | |
By:
/s/ Bernard Bot
Bernard Bot
Executive Vice President and Chief Financial Officer |
|
| Date: August 4, 2016 | | |
By:
/s/ Antonios Basoukeas
Antonios Basoukeas
Chief Accounting Officer |
|
|
Exhibit
No. |
| |
Description
|
|
| 3.1 | | | Amended and Restated Memorandum of Association of Travelport Worldwide Limited (Incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by Travelport Worldwide Limited on September 30, 2014). | |
| 3.2 | | | Amended and Restated Bye-laws of Travelport Worldwide Limited (Incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed by Travelport Worldwide Limited on September 30, 2014). | |
| 10.1 | | | Travelport Worldwide Limited Amended and Restated 2014 Omnibus Incentive Plan. | |
| 10.2 | | | Amendment No. 2 to Credit Agreement, dated as of June 23, 2016, among Travelport Finance (Luxembourg) S.a.r.l., as borrower, Travelport Limited, the Term B Lenders and Deutsche Bank AG New York Branch (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Travelport Worldwide Limited filed on June 27, 2016 (dated June 23, 2016). | |
| 10.3 | | | Consulting Agreement between Travelport Worldwide Limited and Philip Emery, dated May 5, 2016. | |
| 10.4 | | | Form of Director Award Agreement. | |
| 31.1 | | | Certification of Chief Executive Officer Pursuant to Rules 13(a)-14(a) and 15(d)-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2 | | | Certification of Chief Financial Officer Pursuant to Rules 13(a)-14(a) and 15(d)-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32 | | | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS | | | XBRL Instance Document | |
| 101.SCH | | | XBRL Taxonomy Extension Schema Document | |
| 101.CAL | | | XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.LAB | | | XBRL Taxonomy Extension Labels Linkbase Document | |
| 101.PRE | | | XBRL Taxonomy Extension Presentation Linkbase Document | |
| 101.DEF | | | XBRL Taxonomy Extension Definition Linkbase Document | |