Ebookers closes in on full tech migration and profitability

Ebookers is “definitely on the path toward profitability”, according to the chief financial officer of its parent company Orbitz Worldwide.


Marsha C Williams told analysts on Orbitz’ Q1 earnings call that “losses [at Ebookers] have been coming down” and that getting ebookers into the black would be “a combination of an increase in revenue, as well as a reduction in expense.”


The ongoing migration of all its European sites onto a new global platform is key to these twin goals.


Chief executive officer Steve Barnhart explained: “We’re doing our first multiple language site in Belgium [and] once we get beyond that, there are no major new capabilities that we need to test or introduce for the first time… The cycle time and rolling outs for many countries is much much shorter.”


The UK was the first Ebookers site to migrate, and Barnhart said that the UK site had improved its financial performance for three consecutive quarters. It now has “three times more hotel inventory” than previously as the site gets access to all Orbitz Worldwide’s hotels.


“This is driving strong traffic from the UK to US locations,  with gross bookings for hotels in the US [in Q1 08] at almost 9 times Q1 2007 levels,” he explained.


He also noted that, unlike continental Europe, “the overall macroeconomic environmental in the UK has not strengthened, if anything, it has weakened.”


Williams admitted that Orbitz “doesn’t break out EBITDA profitability internationally by segment”. She did however tell analysts that Ebookers’ first quarter gross bookings came in 45% ahead of Q1 07 at $386m. Adjusted net revenue was $33m, a 32% lift.”


Orbitz’ global hotel business HotelClub remains profitable.

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