Sabre says it expects adjusted EBITDA to exceed pre-pandemic levels only by 2025, as travel continues its slow recovery from the impact of the coronavirus.
Announcing fourth quarter and full-year results for the period ending December 31, 2021, the company said it is expecting “strong revenue growth and improving financial performance.”
Sabre reported Q4 revenue of $501 million, up 60% year-on-year, attributing the jump to an increase in air, hotel and other travel bookings.
The company made an operating loss of $126 million compared with $220 million for Q4 2020.
Adjusted EBITDA for the company was a loss of $26 million versus its $101 million adjusted EBITDA loss in Q4 2020.
By comparison, Q4 2019 revenue was $941 million while operating income was $58 million.
Sean Menke, CEO at Sabre, says: “Despite the challenges that the COVID-19 pandemic presented, our team maintained a laser-focus on our strategic initiatives and rapidly advanced our technology transformation while providing excellent support to our customers.”
He adds that the company is excited about growth opportunities as the industry recovers, adding: “Over the medium term, the realization of our technology transformation and cloud migration are expected to unlock significant savings and expand revenue opportunities.”
Full-year revenue for 2021 totaled $1.7 billion compared with $1.3 billion in 2020.
Operating loss reduced to $665 million versus $988 million in 2020 which the company attributes to factors including a $79 million in severance costs and a $20 million reduction in acquisition-related costs to do with the terminated purchase of Farelogix.
Full-year adjusted EBITDA was a loss of $261 million up from the $448 million adjusted EBITDA loss in 2020.
As a comparison, full-year 2019 operating income was $363 million.
Breaking out its various business units, Sabre says distribution revenue was $901 million, up 55% on 2020.
Revenue from IT Solutions revenue came in at $602 million compared with $595 million in 2020.
Meanwhile, Hospitality Solutions saw revenue increase to $203 million, up 16% on 2020’s figure of $175 million.
In an analyst call, Menke describes 2022 as the midpoint of Sabre’s technology transformation - one of five areas of investment the company announced in February 2020 with about $100 million earmarked for that transformation.
He adds that Sabre, alongside partners including Google, plans to have the transformation completed by the end of 2024 when Menke believes the company will be ahead of competitors with its technology and “efficient cost structure.”
Menke says the company chose to invest in the pandemic because it believes “it will deliver an outstanding return on investment” with an expectation of between 30 and 35% return in the next 10 years and a value of $300 million.