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DLE - Ordinary Shares - Irish
Datalex is a leading provider
of travel distribution software and solutions for the global travel industry.
Today, tens of millions of online transactions take place via Datalex solutions
enabling a better customer experience, maximizing revenues and reducing
significant cost savings. Datalex customers include major travel companies
such as United Airlines, SAS, Aer Lingus and STA Travel. Datalex has served
the travel industry with innovative technology products and solutions for
over 20 years and has an in depth understanding of the travel distribution
environment.
Founded in 1985, the
company is headquartered in Dublin, Ireland, and maintains offices across
Europe, the USA and Asia-Pacific. Datalex is a publicly held company traded
on the Irish Stock Exchange (symbol: DLE, and also OTC: DLEXY). For more
information, please visit the company’s Web site at www.datalex.com.
http://www.datalex.com/
Interim
Management Statement
Dublin,
18th May 2009 - Datalex, a leading provider of travel distribution software
and solutions to the global travel industry, today publishes its Interim
Management Statement in respect of the four months to 30 April 2009.
Business
Environment
The
travel industry has experienced a difficult first four months of 2009.
With global economic conditions reducing travel demand, airlines have responded
by seeking to cut costs and maximise revenue. As in the first half of 2008
when oil prices spiked, this market uncertainty has inevitably led to an
initial slow down in capital expenditure and IT investment, with airlines
preserving their cash reserves until they have better clarity on full year
trading performance.
However,
one significant difference between 2008 and 2009 is that the record oil
prices of last year caused many airlines to reduce capacity in order to
save on fuel costs, whereas this year, with oil back down to mid $50s,
airlines can market and discount their fares in order to drive capacity
and yields, to increase their revenue. It is in this context that the full
capabilities of the TDP platform, and how it can empower our customers
to grow revenue and reduce costs, have become clear.
Trading
Performance
Total
revenue in the first four months of 2009 amounted to $9.6m, which was 9%
behind expectations for the period, but on a par with the same period in
2008, after exchange rate movements are eliminated.
The
current challenging economic environment has provided an excellent opportunity
to show the strength of the Datalex product platform and our transaction
model. Our transaction revenue in the first four months of 2009 amounted
to $4.7m, an increase of 46% on the same period last year (2008 January
to April: $3.2m), as airlines aggressively price and sell inventory to
maintain their yields. On a like for like basis, 2009 transaction revenue
from the same customers in this period (Jan – April) shows an increase
of 12% to $3.6m, compared to 2008. This clearly shows that quite apart
from the benefit of adding new customers to the platform, we are also enabling
existing customers increase their on-line and direct penetration to grow
their revenue, which in turn increases our transaction revenue.
This
trend is expected to continue through the remainder of 2009, with the planned
go-live of TDP at Copa Airlines of Panama, and of particular significance,
the launch of our ground-breaking ‘TDP Agent’ product at Flight Centre,
one of the world’s largest travel agencies. Both of these customers are
expected to go live and begin generating transaction revenue my mid 2009.
Total
operating costs for the four months to 30th April were $10.9m, or 8% below
our budget for the period. The difficult trading environment has highlighted
the benefit of our decision in 2006 to outsource significant elements of
product development and support activities, which has given us flexibility
to dynamically adjust our business to changing operating conditions. This
allows us to tune down our cost base when required, while allowing us maximum
flexibility to increase our resource pool as customer activity increases.
Cash
reserves at the end of April were $10.3m, which is in line with our budget.
There were no substantial changes in working capital components in the
period. We expect to generate cash in the current financial year.
Outlook
Despite
the difficult economic circumstances, the TDP platform has clearly demonstrated
its ability to enable our customers to grow their online and direct revenues,
while enabling significant reductions in distribution costs. Effective
financial management is, now more than ever, critical to the success of
the travel industry, and coupled with the demonstrable RoI achievable from
the TDP platform, our product continues to attract strong interest in the
market, and we are currently pursuing a healthy pipeline of new business.
The launch of the TDP Agent product will represent a ‘first to market’
response to the business transformation taking place in the global travel
agency sector, and should enable Datalex to broaden its customer base |
