Redefining Travel Commerce. Morgan Stanley European TMT Conference November 21, 2014

Transcription

1 Redefining Travel Commerce Morgan Stanley European TMT Conference November 21, 2014

2 Disclaimers Related to Forward-Looking Statements Certain items in this presentation and in today s discussion, including matters relating to revenue, net income and earnings, and percentages or calculations using these measures, capital structure, future business opportunities, plans, prospects or growth rates and other financial measurements and non-financial statements in future periods, constitute forward-looking statements. These forward-looking statements are based on management s current views with respect to future results and are subject to risks and uncertainties. These statements are not guarantees of future performance. Actual results may differ materially from those contemplated by forward-looking statements. Travelport Worldwide Limited (the Company or Travelport ) refers you to our filings with the Securities and Exchange Commission (SEC), including our Registration Statement on Form S-1 that was declared effective on September 24, 2014, for additional discussion of these risks and uncertainties, as well as a cautionary statement regarding forward-looking statements. Forward-looking statements made during this presentation speak only as of today s date. Travelport expressly disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Related to Non-GAAP Financial Information Travelport analyzes its performance using Adjusted EBITDA, Adjusted Net Income, Adjusted Earnings per Share, Adjusted Free Cash Flow, Capital Expenditures, Net Debt, Trading Working Capital and Unlevered Adjusted Free Cash Flow, which are non-gaap measures. Such measures may not be comparable to similarly named measures used by other companies. The Company believes these measures provide management with a more complete understanding of underlying results, trends and the liquidity of the core operating business, along with the Company s ability to meet its current and future financing and investing needs. Adjusted EBITDA is the primary metric, used to evaluate and understand our underlying operations and business trends, forecasting and determining future capital investment allocations and is one of the measures used by the Board of Directors to determine incentive compensation. Capital expenditures, which impact depreciation and amortization, interest expense and income tax expense, are reviewed separately by management. Adjusted EBITDA is disclosed so that investors have the same tools as those available to management when evaluating the results of Travelport. Adjusted EBITDA is defined as Net Income adjusted to exclude depreciation and amortization of property and equipment, net interest expense, provision for income taxes, share of earnings (losses) in equity method investments, loss on extinguishment of debt, gain on sale of shares of Orbitz Worldwide, amortization of Customer Loyalty Payments ( CLPs ), costs associated with corporate transactions, costs associated with our restructuring efforts, equity-based compensation, certain litigation and related costs, unrealized foreign currency (gains) losses on euro denominated debt and earnings hedges, and other items we believe potentially restrict our ability to assess the results of our underlying business. 2

3 Executive Management Team Gordon Wilson President and Chief Executive Officer since June years at Travelport Philip Emery Chief Financial Officer since October years at Travelport Launched a new five year strategy in 2012 and delivered on the first two years 3

4 An Attractive Investment Opportunity 1 Differentiated Travel Commerce Platform Approach to Address Evolving Needs of the Travel Industry 2 Pioneering B2B Payment Solution Business 3 Partner of Choice for LCCs and Distribution of Ancillaries 4 Balanced Global Footprint Aligns with Global Growth Areas 5 Customer Momentum Generated from Investments in Next Generation Merchandising and Mobile Platform 6 Resilient, Recurring, Transaction-Based Business Model with Higher Cash Flow Conversion 7 Accelerating Growth 4

5 Travelport Leading Global Travel Commerce Platform #2 GDS globally by revenue with balanced footprint for 67,000 travel agency locations Focused on distribution platform versus airline / hotel IT solutions business Lower absolute capex and higher cash conversion Leading B2B platform for airline merchandizing, hotel distribution and travel payments all growth areas enett is transforming the traditional B2B travel payment model and addressing unmet needs of the travel industry 9 consecutive quarters of Pro Forma (1) Total Revenue growth 2013 Revenue: $2.1bn Technology Services 6% $117m Travel Commerce Platform 94% $1,959m Geographic Footprint Air $1,588m 81% Beyond Air $371m 19% Selling Countries: Over consecutive quarters of Pro Forma (1) Adjusted EBITDA growth Global Headquarters: Langley, UK 6 11 consecutive quarters of RevPas growth Significant deleveraging reduced net debt from $3.3bn at the end of 2013 to $2.3bn today Development Centers: Systems Operations Center: Employees: Atlanta, Denver, Kansas City, New Delhi Atlanta 3,400 Full Time + 1,100 in Indian Technology JV (1) Pro forma to exclude United Master Service Agreement 5

6 Travelport is the #2 GDS by Revenue By revenue, Travelport is the #2 GDS globally and 10% larger than the #3 GDS (YTD Sep 2014) By air booking volumes, Travelport is the #3 GDS, although the gap has closed since 2007 The difference between revenue and air share reflects Travelport s focus on the Travel Commerce Platform: o Merchandising / Ancillaries: focus on selling more value per segment o Geographic footprint: Best in class geographic footprint supporting positive pricing dynamics o Beyond Air: Strategic focus on expanding into hospitality and payments Air Share Increased From 2007 and Stabilized After 2012 Share of Global GDS Air Bookings* 2007 (pre-acquisition of Worldspan) Share of Global GDS Air Bookings* Today 50% 50% 40% 40% 30% 20% 10% 22% 30% 20% 10% 26% 0% Travelport Worldspan Amadeus Sabre Abacus 0% Travelport Amadeus Sabre Abacus Acquired Worldspan in 2007 after they lost Expedia contract Successfully managed integration of two GDS businesses in 2007 & 2008 Structural change in Middle East operations proactively swapped share for improved margin in * Includes segments sold, not processed. Excludes regional GDSs such as Topaz (South Korea), AXESS / Infini (Japan), Travelsky (China), Sirena (Russia).

7 Our Balanced Global Footprint Aligns with Global Growth Areas Total GDS Industry MIDT Air Bookings Travelport MIDT Air Bookings The Value of Global Breadth to Travelport 31% 31% 39% 26% Greatest exposure to high growth international regions 11% % 10% 5% 18% Majority of Travel Commerce Platform Revenue from International Segment, and Increasing International Revenue as % of Total Travel Commerce Platform Revenue 64% Int l 66% Int l 68% Growth Growth 1, % 1, % 1,959 11% Less concentration in any single or domestic region More protection from regional instability Greater ability to deliver high value away segments due to strong international presence (1) Enhances value proposition for travel providers United States Europe Middle East & Africa Asia Pacific Latin America & Canada Note: Based on FY 2013 MIDT GDS air segments. Total GDS industry data includes Abacus, but excludes Travelsky and other regional GDSs. Figures may not add to 100% due to rounding (1) Away markets are defined as markets outside the travel provider s home country 7 7

8 And Provides Better Value to Airlines Through Access to Away Markets Away Segments Drive the Majority of Travelport s Profitability GDSs provide greater value to airlines on away bookings than home bookings (1) Travelport Away Segments for % Access to demand in regions where brand is weaker (less direct bookings on airline website) 62% Home and Away pricing model provides greater profitability to Travelport 50% 43% Airlines generally pay higher fees on away bookings which add more value Travelport s global, geographically balanced footprint provides greater ability to deliver high value away segments 0% % of Total Air Segments % Air Segment Revenue 82% of Air Revenue from International Markets and / or Away Segments More of additional airline capacity being deployed on international routes versus domestic (1) Away bookings are defined as bookings made by travel buyers located outside the travel provider s home country 8

9 Changing Dynamics of the Airline Industry 1 2 Growth of LCCs and Their Need for 3 Globalization of Air Travel Expansion into the Business Travel Industry Growing Importance of Retailing and Ancillary Revenue for Airlines Net Increase in Airplanes in Service from (# of Aircrafts) CAGR LCC Share of Global Airline Seats Sold is Steadily Increasing Ancillary Revenue Growth ($bn) Double 65.0 APAC* Europe LatAm NA 5,310 3,620 2,510 2, % 3.1% 5.6% 1.5% 9.5% 8.0% 11.5% 14.9% 13.5% 16.7% 19.3% 23.4% 24.3% 21.1% 21.9% 26.1% 26.3% Double ME 1, % China 4, % Source: OAG, Boeing * APAC excludes China Most balanced geographic footprint with leading global connectivity Well-positioned to benefit from the mix shift towards away segments Source: IATA, CAPA, OAG Unique XML connectivity and merchandising capabilities to meet the needs of LCCs Recent wins include AirAsia, easyjet, Ryanair and Spirit Airlines Source: Ideaworks Ancillary Report forecast based on previous 3 years CAGR Rich Content and Branding enables airlines to display and differentiate the benefits of their product to drive revenue growth Ancillary Services offers sophisticated distribution of ancillaries 9

10 Ground-breaking Travelport Smartpoint makes air merchandising real Legacy Desktops Reality today with Travelport Smartpoint: A merchandising platform From this....to this From a transactional booking system To a true commerce platform for multichannel retailing airlines Broader content Enhanced advertising capabilities Sell on value, not on price 10

11 now with the same Rich Content & Branding as leading travel providers' websites Legacy Desktops Reality today with Travelport Smartpoint: with Rich Content & Branding and now this From a transactional booking system To a true commerce platform for multichannel retailing airlines Broader content Enhanced advertising capabilities Sell on value, not on price 11

12 Our Platform extends Beyond Air to Hotels, Advertising and Payments Greatest Number of Unique Properties on Any Platform Chain Hotels and Car Rental (the core) B2B distribution to Agencies and OTAs >100,000 chain hotel properties 61m room nights sold in 2013 ~35,000 car rental locations 76m car rental days booked in 2013 Independent Hotel Properties (the extension) Retail rates from leading aggregators >500,000 independent hotel properties + + Technology meta-search extensible to other content types insurance, pre-bought foreign exchange, car parking, etc. Corporate Rates for Independent Hotels Graphical Point of Sale Solutions Provide Rich Advertising Opportunities Advertising (the extension) Direct-to-agent on-screen text and graphical marketing 234,000 captive audience of agency desktops x Fast Growing, Innovative Product in Nascent Travel Payment Industry Payments (the multiplier) B2B payments between travel agencies and travel providers $780bn addressable opportunity in nascent industry Strategic partnership with MasterCard Deep travel domain expertise and unique operating model and processes >600,000 Unique Hotel Properties ~4,000 Advertisers enett ~45% Net Revenue Growth in YTD Sep 2014 Beyond Air +12% Revenue Growth in YTD Sep

13 Travelport powers hotel distribution to retail and corporate channels like no other New version of Travelport Smartpoint includes significant further enhancements to hotel booking Hotelzon enhancing content, efficiency and choice in the corporate hotel booking market Hotelzon Online version 9.2, launched October 2014 Travelport Smartpoint version 4.0, launched November

14 enett is Transforming the Traditional B2B Travel Payment Model Outside the United States, the Travel Agency is Often the Merchant of Record Inefficient, timeconsuming reconciliation processes Significant credit card fraud Limited protection against airline bankruptcies Costly FX enett Payment Model enett VANS are Pre-Funded and Integrated into the Agent Workflow C2B 2. Agent funds enett Pay In account END CUSTOMER 1. Traveller books and can pay with multiple forms of payment ONLINE AND OFFLINE TRAVEL AGENCIES 4. Agent receives real-time, automated reconciliation data VAN 3. enett VAN is generated according to booking criteria and accepted by travel provider TRAVEL PROVIDERS 5. Provider processes as any CNP MasterCard transaction enett makes money through interchange fee enabling significant savings for travel intermediaries 14

15 Unique Value Proposition Addressing Unmet Needs of the Travel Industry Risk Fraud protection Protection against airline insolvencies Reward Rebates paid on every transaction Reduced FX exposure Developed in Partnership with Optal (PSP) Payment Experts Unique Banking Relationships Established Deep, Strategic Partnership with Mastercard AGENCIES PROVIDER Fully Integrated in Travel Supplier Workflows with Level 3 Data Enabling Automated Reconciliation First Mover Advantage and Proven Business Model Already Profitable Reconciliation Embedded into workflow avoids time-consuming, manual reconciliation processes Internet Growth with Real Profit Competitive Advantage Over Commercial Banks Driving security, efficiency and value for travel agencies and travel providers Strong Barriers to Entry 15

16 enett is Ready to Take Off 1 Formed in partnership with Optal (PSP) new FTEs added YTD Sep 2014 (100 FTEs) London office Citi global banking relationship $45m 2013 net revenue, +137% YoY MasterCard signs initial agreement : Business turned profitable MasterCard signs long-term strategic partnership Significant upside: $780bn Addressable Opportunity Increased Ownership Stake to 73% at an Implied $450m Valuation First Mover Advantage in a Nascent Industry Reliable Solution with Broad Acceptance 16

17 American Delta United Southwest China Southern Ryanair China Eastern Air China Lufthansa easyjet Momentum Winning with Customers Travelport Distributes Content of All of the Top 10 Airlines Pioneering, Fast Growing Payment Solution for Travel Intermediaries Top 10 Global Airlines by Passengers Boarded in 2013 m net revenue of $45m (+137% YoY) $780bn addressable opportunity (1) = On Travelport 439 customers as of Sep 2014 (+135% YTD) Recent Airline Wins Recent Travel Agency Wins U.S. Aggregated Shopping: Signed 6 airlines Ancillary Services: Signed 23 airlines, 50+ ancillary types Rich Content and Branding: Signed 75+ airlines Europe LatAm & Canada APAC Middle East & Africa (1) Based on management estimates 17

18 Momentum Redefining Our Product Offering Over $475m Invested in Products Since 2012 Travelport Merchandising Platform Travelport Advertising & Marketing Solutions Travelport Rooms and More Travelport Smartpoint & Universal Desktop Full range of seating products for At the Forefront of Innovation Revolutionizing Travel Commerce Hotel only booking solution for corporates addressing chain & independent hotels Leading Global Travel Commerce Platform Multisource content and pricing through a single platform Graphically rich, single user interface Open platform to fully integrate XML connectivity B2B travel related payments space 18

19 Momentum In Key Business Metrics RevPas 1 st Quarter 2 nd Quarter 3 rd Quarter 4 th Quarter +2% +1% +3% +4% +1% +4% +5% $5.75 $5.61 $5.66 $5.67 $5.68 $5.60 $5.61 $5.47 $5.46 $5.39 $5.19 Consistent growth in RevPas, International Travel Commerce Platform Revenue, Beyond Air Revenue and other key metrics International Travel Commerce Platform Revenue $m +7% +3% +7% % +4% % +7% Hotel Room Nights (m) Car Rental Days Sold (m) Hospitality Segments per 100 Airline Tickets Issued enett net revenue ($m) Beyond Air Revenue $m +12% +9% +18% % % +14% % % of Air Revenue from Away bookings 58% 60% 62% % of TCP Revenue from International 64% 66% 68% % of TCP Revenue from Beyond Air 15% 17% 19% Adjusted EBITDA ($m) (1) (1) Pro forma to exclude United Master Service Agreement 19

20 Predictable, Recurring Operating Model (FY 2013) Travel Commerce Platform revenue Reported Segments RevPas 350m $5.60 $1,959m Technology Services revenue Total Revenue Net Commissions (1) Technology costs $117m $2,076m $915m $288m Selling, General & Administrative (2) $356m Adjusted EBITDA $517m Over 99% Recurring Revenue in Multi-Year Customer Contracts Renewed 100% of Planned Airline Contracts in 2013 No Losses of Material Travel Buyer Contracts in the Last Three Years (1) Net Commissions is after adding back $63m Amortization of Customer Loyalty Payments for FY 2013 (2) SG&A excludes certain costs which are excluded from Adjusted EBITDA 20

21 Low Capital Intensity and Strong Cash Flow Conversion Low Capital Intensity Strong Cash Flow Conversion (1) $m 83% 78% 75% 86 (3) % 5.4% 6.1% Capital Expenditures as % of Net Revenue $m Travelport Adjusted EBITDA (2) Net cash provided by operating activities Less: Cash capital expenditure (72) (92) (107) Less: Finance lease principal payments (14) (16) (20) Add: Other non-operating and adjusting items Less: United MSA cash (70) (40) 0 Adjusted Free Cash Flow Add: interest paid Unlevered Adjusted Free Cash Flow (1) Cash flow conversion calculated as (Adjusted EBITDA Capital Expenditures) / Adjusted EBITDA (2) Excludes impact of United Master Services Agreement (3) Excludes impact of $5m of additions related to discontinued operations 21

22 Highly Attractive Financial Model Transaction-Based, Recurring, Highly Visible Revenue Transaction-based, volume driven model (not linked to price) High recurring revenue of 100% for air providers and beyond air providers in 2013 Last of legacy contracts addressed with 2015 being the transition year for their impact Diversified and Resilient Model Global, geographically balance business with limited regional concentration Consistent performance, even in challenging macro environment No customer accounts for more than 10% of revenue Low capital intensity, with no ownership of fixed assets Strong Free Cash Flow Generation Low working capital needs Cash flow conversion of ~75% Expect improved long-term cash flow as Travelport delevers through the IPO Operating Leverage Drives Upside Positioned to leverage growth in travel volumes due to scalable infrastructure Significant investments in product and infrastructure, to support new trends in merchandizing and to grow RevPas 22

23 An Attractive Investment Opportunity 1 Differentiated Travel Commerce Platform Approach to Address Evolving Needs of the Travel Industry 2 Pioneering B2B Payment Solution Business 3 Partner of Choice for LCCs and Distribution of Ancillaries 4 Balanced Global Footprint Aligns with Global Growth Areas 5 Customer Momentum Generated from Investments in Next Generation Merchandising and Mobile Platform 6 Resilient, Recurring, Transaction-Based Business Model with Higher Cash Flow Conversion 7 Accelerating Growth 23

24 Q Earnings Appendices Highlights 24

25 Key Points Solid Q3 performance Net Revenue up 3% and Adjusted EBITDA up 4% Continued strengthening of the Travel Commerce Platform Beyond Air revenue increases 14%, driven by growth in hospitality and payments enett momentum continues with ~45% revenue growth and new customer wins Launched enhanced agency desktop with unique merchandising Rich Content & Branding solution fully integrated Deleveraging transactions, IPO and refinancing significantly strengthen balance sheet and free cash flow generative ability looking forward Board of Directors declared 7.5 cents dividend for Q3 Positive outlook for full year 25

26 Group Financial Highlights Q3 and YTD Sep 2014 Solid Financial Performance Q3 Net Revenue Q3 Adjusted EBITDA YTD Net Revenue YTD Adjusted EBITDA Net Revenue +3% for Q3 (+3% for Q3 YTD) 3% 4% 3% 5% Travel Commerce Platform revenue +4% for Q3 and Q3 YTD Beyond Air revenue grew 14% for Q3 (12% for Q3 YTD) US$m Q Better / (worse) $ Better / (worse) % Net Revenue % Adjusted EBITDA % Adjusted Net Loss (3) 5 63% Adjusted Free Cash Flow (62) (86) n/m Net Debt * 2,269 1,071 32% US$m Q3 YTD 2014 Better / (worse) $ Better / (worse) % Net Revenue 1, % Adjusted EBITDA % Adjusted Net Loss (9) 14 60% Adjusted Free Cash Flow (80) (102) n/m Adjusted EBITDA +4% for Q3 (+5% for Q3 YTD) Adjusted Net Loss and Adjusted Free Cash Flow in current year reflect legacy capital structure Capital Structure Transformation Net Debt of $2.3bn at September 30, 2014 with Net Leverage ratio at 4.2 times LTM Adjusted EBITDA (December 31, 2013: $3.3bn, 6.5 times) Over $1bn net debt reduction principally driven by: $571m of debt-for-equity exchange transactions $366m net proceeds from sales of Orbitz Worldwide shares $445m net proceeds from IPO Comprehensive debt refinancing no term loan maturities until 2021 Interest reduction significantly enhances Travelport s free cash flow generative ability Dividend Policy Initiated Q3 dividend of 7.5 cents per share n/m = not meaningful. * Net Debt for September 30, 2014 as compared to December 31, All other metrics are compared on a year-on-year basis. 26

27 Travel Commerce Platform Highlights Beyond Air Acceleration of revenue growth Q3 revenue up 14% (Q3 YTD, up 12%) driven by growth in hospitality and payments Hospitality Significant improvement in hospitality attachment rates during the quarter Hospitality segments per 100 airline tickets issued increased to 45 (Q3 2013: 42) Acquisition of corporate hotel booking system Hotelzon extended unique hotel properties further to industry-leading position of >600,000 Hotelzon expanded into France and Poland; further expansion in the pipeline Enhanced version of user interface, Hotelzon Online, launched in October Premier Inn now fully implemented and bookable fastest growing hotel chain in the UK Partnership with TripAdvisor to power its new Instant Booking feature Payments Continued further momentum in payments business, enett Net revenue growth of ~45% in Q3 Significant win with Flight Centre, one of the world s largest travel agency groups already a major customer of the Travel Commerce Platform Extended capabilities into corporate travel channel via landmark agreement with Cornerstone Information Services Beyond Air continues to drive growth of the Travel Commerce Platform 27

28 Travel Commerce Platform Highlights Air Continued low cost carrier (LCC) participation. Added during the quarter: Leading Turkish LCC, Pegasus Airlines, as well as three further LCCs in Asia: AirAsia India, Jeju Air (South Korea) and Malindo Air (Malaysia) Numerous new global air agreements signed across all regions. Recent network carrier deals include: Alitalia and SAS in Europe; BQB Líneas Aéreas and Tropic Air in the Americas; Middle East Airlines (ME) Enhanced version of merchandising agency desktop solution, Travelport Smartpoint, now live Now with industry-leading Rich Content & Branding merchandising solution fully integrated Enhanced upsell / cross-sell opportunity for next product up and fast-growing air ancillaries 76 airlines signed for Rich Content & Branding 30 since the end of June with recent deals including Air India (Asia), Aeroflot (Russia), SAS (Scandinavia) and South African Airways (South Africa) Significant pipeline Continued air content leadership increased low cost carrier content and enhanced merchandising platform 28

29 Focused on a Truly Global Customer Base Targeted Geographical Growth Travel Commerce Platform Strong International revenue growth of 5% (Q3 YTD) driven by 2% growth in Reported Segments and 3% increase in RevPas: Benefiting from our investment in growth regions Accounts for 68% of our Travel Commerce Platform revenue Travelport s US performance benefiting from increased international carrier bookings together with growth in hotel and car reservations Customer Highlights Signed and renewed major customer agreements across all regions, including leading Travel Management Companies (TMCs) and Online Travel Agencies (OTAs): Corporate travel: BCD (global), Carlson Wagonlit (global), DER Touristik (Germany), Travel Inc., and Travel & Transport (US) OTAs: Despagar (Latin America) Post-period, signed Hong Kong based Hutchison-Priceline (Travel) Limited one of Asia s largest OTAs Q3 YTD Travel Commerce Platform Revenue ($m) Region Q3 YTD Reported Segments (in millions) Region Better/ (Worse) Asia Pacific % Europe % Latin America & Canada % Middle East & Africa % International 1,064 1,017 5% United States % Travel Commerce Platform 1,561 1,507 4% Better/ (Worse) Asia Pacific % Europe % Latin America & Canada % Middle East & Africa International % United States % Reported Segments % 29

30 Summary & Outlook Summary Solid growth continues into Q3: Net Revenue +3% (YTD: +3%) and Adjusted EBITDA +4% (YTD: +5%) Travel Commerce Platform continues to strengthen: Strong performance in Beyond Air, with continued momentum in hospitality and payments Continued Air content leadership and delivery of differentiated merchandising solution Significant new customer agreements signed in the quarter, including a number of the world s leading corporate travel management companies and online travel agencies Successful IPO and deleveraging has led to significant improvement to capital structure and balance sheet; strengthened free cash flow generative ability Outlook Momentum continues into Q4; full year Adjusted EBITDA guidance of $538m $540m 30

31 31 Appendices

32 Primarily Transaction-Based Revenue Model with High Recurring Revenue and Significant Revenue Visibility Traveler Illustrative Payment Flows for Transaction Processing 1 return trip airline ticket (connecting flight) 1 car hire (3 days) 1 hotel reservation (3 nights) Total Segments (transactions) Volume driven model with booking fees independent of the price of the booking sold Travel providers generally lower price to maintain volumes in challenging macro environments Travel Providers (airlines, hotels, car hire, rail, cruise operators, etc.) $30 Booking fee or yield (6 x $5) $15 GDS gross margin (6 x $2.50) $15 Agency incentives (6 x $2.50) Transaction Based Processing $ flow $ flow Travel Agencies Online (OTA) and Traditional 1 Supply content 2 Booking related services 3 Merchandizing services Payment solutions Pricing, availability, reservations, ticketing, payments Payment for software/services Over 99% Recurring Revenue in Renewed 100% of Planned Airline Contracts in 2013 Multi-Year Customer Contracts No Losses of Material Travel Buyer Contracts in the Last Three Years Note: $ amounts for illustrative purposes only 32

33 Update on Key Service Agreements 2014 New long term services agreement: 2014 Adjusted EBITDA unaffected Higher Customer Loyalty Payments reflected in 2014 cash flow Majority of Orbitz Worldwide GDS segments to continue to be processed on Travelport Plans to upgrade to latest Travelport API technology for enhanced access to content on the Travelport Merchandising Platform 2015 Onwards Orbitz Worldwide continues to have minimum specified volume commitments to Travelport Increased incentive payments to Orbitz Worldwide: Other growth initiatives to largely mitigate negative financial impact on earnings and cash flow Delta has reacquired the data and intellectual property rights central to its passenger service and flight operations systems: Delta is the only U.S. airline to directly control these critical technology systems Better able to build the next generation of technology that will improve the travel experiences of its customers Did not require a technology migration event so there was no effect to Delta customers Travelport signed a new long-term agreement and continues to be a key partner with Delta Travelport continues to run the system infrastructure for the Delta platform in its Atlanta data center The transition of 178 technology professionals to Delta was effected July 1, 2014 No impact on Delta and Travelport s existing Global Distribution Systems agreement which was previously renewed in