Travelport Results - the billion dollar black hole that has finally disappeared (maybe)

I am going to have to renounce all attempts to blog less about Cendant/Travelport. Every time I try - a new story emerges. There is no way I can ignore the recent Q2 06 results announcement, especially as it (how's this for a mixed metaphor) brings back to life the billion plus dollar elephant in the room that has been haunting the halls of Travelport since it's emergence from the ashes of Cendant.

The Good news is gross bookings up a healthy 32% versus prior year and cash flow from operations is $221mm up $35mm.

The Bad news is that revenues are up only 5% to $693mm. A 5% increase in a business heavy in great online brands such as Orbitz, HotelClub and RatesToGo is hard to swallow. With ebooker's profitability and turn around years away by their own admission there is a lot more pressure on these three brands to compensate. This also places even more pressure on the Galileo GDS business which has to face declining yields every year as airlines push, bite, shove and kick to reduce segment fees. It also strengthens the incentive for Blackstone to cut free the faster growing business from the poor performers to unlock the value (as they say in the private equity world).

The awful news is the $1.2billion dollar write-off. A carry over of the turning of $7bil into $4.3bil when Travelport was sold to Blackstone. I am running out of ways to express my sadness that there are so many great people from ebookers, Orbitz, HotelClub and RatesToGo that paid for that overspend with disruption, dissatisfaction and sometimes their jobs. At least the monkey is now off their back and the elephant can be put to bed (today is a day for mixed metaphors).

We also received word on another to add to our "where are they now" list with CFO Darly Raiford to depart.