July 31, 2020 / 6:49 AM / 6 days ago

Travel technology firm Amadeus reports smaller-than-expected loss

(Reuters) - Spanish travel technology firm Amadeus’ (AMA.MC) reported its first loss in a decade in the second quarter when airlines around the world were grounded due to the COVID-19 pandemic, but the loss was less than expected.

Amadeus, the world’s biggest provider of booking services, reported a 231 million euro (209.14 million pounds) loss in April to June, compared to a 305 million euro loss forecast by analysts in a Refinitiv poll.

Its shares were trading flat by 0805 GMT after an initial modest rise.

Mirabaud Group analyst Gonzalo De Cueto said the group had a strong financial position with 4.1 billion euros in liquidity and had announced a plan to cut 250 million euros of fixed costs from 2020 until 2021.

The group said its air travel agency net bookings in April and May were negative, as the number of cancellations exceeded gross bookings.

“Since late May, we have begun to see an increasing number of flights being scheduled, and air traffic and bookings have been responding,” President and Chief Executive Luis Maroto said in a statement.

Amadeus’ earnings are strongly tied to the number of bookings it handles, as the company charges a fee for every reservation made on its platforms. About a fifth of its revenue comes from its IT hospitality business and non-air bookings.

It said its travel agency air bookings slumped 113% in the quarter, while the number of passengers boarded via its IT business suffered a contraction of 94%.

Amadeus said revenue fell 82% to 259.5 million euros in second quarter. Analysts polled by Refinitiv had predicted an even deeper slump.

Reporting by Anita Kobylinska, Editing by Inti Landauro and Edmund Blair

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