|
Bermuda
|
| |
98-0505105
|
|
|
(State or other jurisdiction of
incorporation or organization) |
| |
(I.R.S. Employer
Identification Number) |
|
|
Large accelerated filer
|
| | ☒ | | | Accelerated filer | | | ☐ | |
|
Non-accelerated filer
|
| | ☐ | | |
Smaller reporting company
|
| | ☐ | |
| | | | | |
Emerging growth company
|
| | ☐ | |
| | |
Page
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| | | | 1 | | | | |||
PART I. FINANCIAL INFORMATION
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| | | | 3 | | | | |||
| | | | 3 | | | | |||
| | | | 4 | | | | |||
| | | | 5 | | | | |||
| | | | 6 | | | | |||
| | | | 8 | | | | |||
| | | | 9 | | | | |||
| | | | 32 | | | | |||
| | | | 57 | | | | |||
| | | | 58 | | | | |||
PART II. OTHER INFORMATION
|
| | | | ||||||
| | | | 59 | | | | |||
| | | | 59 | | | | |||
| | | | 59 | | | | |||
| | | | 59 | | | | |||
| | | | 59 | | | | |||
| | | | 59 | | | | |||
| | | | 59 | | | | |||
| | | | 60 | | | |
(in $ thousands, except share data)
|
| |
Three Months
Ended September 30, 2018 |
| |
Three Months
Ended September 30, 2017 |
| |
Nine Months
Ended September 30, 2018 |
| |
Nine Months
Ended September 30, 2017 |
| ||||||||||||
Net revenue
|
| | | $ | 622,585 | | | | | $ | 610,842 | | | | | $ | 1,962,431 | | | | | $ | 1,873,712 | | |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenue
|
| | | | 400,679 | | | | | | 388,027 | | | | | | 1,254,868 | | | | | | 1,144,572 | | |
Selling, general and administrative
|
| | | | 127,538 | | | | | | 110,916 | | | | | | 395,093 | | | | | | 336,272 | | |
Depreciation and amortization
|
| | | | 50,253 | | | | | | 50,314 | | | | | | 148,398 | | | | | | 156,871 | | |
Total costs and expenses
|
| | | | 578,470 | | | | | | 549,257 | | | | | | 1,798,359 | | | | | | 1,637,715 | | |
Operating income
|
| | | | 44,115 | | | | | | 61,585 | | | | | | 164,072 | | | | | | 235,997 | | |
Interest expense, net
|
| | | | (27,772) | | | | | | (28,793) | | | | | | (66,312) | | | | | | (92,011) | | |
Loss on early extinguishment of debt
|
| | | | (38) | | | | | | (4,682) | | | | | | (27,699) | | | | | | (4,682) | | |
Gain on sale of a subsidiary
|
| | | | — | | | | | | — | | | | | | — | | | | | | 1,217 | | |
Other expense
|
| | | | (266) | | | | | | (846) | | | | | | (730) | | | | | | (2,538) | | |
Income before income taxes
|
| | | | 16,039 | | | | | | 27,264 | | | | | | 69,331 | | | | | | 137,983 | | |
Provision for income taxes
|
| | | | (10,169) | | | | | | (22,583) | | | | | | (24,972) | | | | | | (43,073) | | |
Net income from continuing operations
|
| | | | 5,870 | | | | | | 4,681 | | | | | | 44,359 | | | | | | 94,910 | | |
Income from discontinued operations, net
of tax |
| | | | — | | | | | | — | | | | | | 27,747 | | | | | | — | | |
Net income
|
| | | | 5,870 | | | | | | 4,681 | | | | | | 72,106 | | | | | | 94,910 | | |
Net (income) loss attributable to non-controlling interest in subsidiaries
|
| | | | (762) | | | | | | 169 | | | | | | (2,025) | | | | | | 973 | | |
Net income attributable to the Company
|
| | | $ | 5,108 | | | | | $ | 4,850 | | | | | $ | 70,081 | | | | | $ | 95,883 | | |
Income per share – Basic: | | | | | | | | | | | | | | | | | | | | | | | | | |
Income per share – continuing operations
|
| | | $ | 0.04 | | | | | $ | 0.04 | | | | | $ | 0.34 | | | | | $ | 0.77 | | |
Income per share – discontinued operations
|
| | | | — | | | | | | — | | | | | | 0.22 | | | | | | — | | |
Basic income per share
|
| | | $ | 0.04 | | | | | $ | 0.04 | | | | | $ | 0.56 | | | | | $ | 0.77 | | |
Weighted average common shares outstanding – Basic
|
| | | | 126,246,210 | | | | | | 124,469,069 | | | | | | 125,908,707 | | | | | | 124,303,716 | | |
Income per share – Diluted: | | | | | | | | | | | | | | | | | | | | | | | | | |
Income per share – continuing operations
|
| | | $ | 0.04 | | | | | $ | 0.04 | | | | | $ | 0.33 | | | | | $ | 0.76 | | |
Income per share – discontinued operations
|
| | | | — | | | | | | — | | | | | | 0.22 | | | | | | — | | |
Diluted income per share
|
| | | $ | 0.04 | | | | | $ | 0.04 | | | | | $ | 0.55 | | | | | $ | 0.76 | | |
Weighted average common shares outstanding – Diluted
|
| | | | 128,389,385 | | | | | | 126,188,372 | | | | | | 127,854,478 | | | | | | 125,827,540 | | |
Cash dividends declared per common share
|
| | | $ | 0.075 | | | | | $ | 0.075 | | | | | $ | 0.225 | | | | | $ | 0.225 | | |
(in $ thousands)
|
| |
Three Months
Ended September 30, 2018 |
| |
Three Months
Ended September 30, 2017 |
| |
Nine Months
Ended September 30, 2018 |
| |
Nine Months
Ended September 30, 2017 |
| ||||||||||||
Net income
|
| | | $ | 5,870 | | | | | $ | 4,681 | | | | | $ | 72,106 | | | | | $ | 94,910 | | |
Other comprehensive income (loss), net of tax | | | | | | | | | | | | | | | | | | | | | | | | | |
Currency translation adjustment, net of tax
|
| | | | (1,937) | | | | | | 4,234 | | | | | | (8,522) | | | | | | 20,533 | | |
Amortization of actuarial loss to net income, net
of tax |
| | | | 2,524 | | | | | | 2,856 | | | | | | 7,577 | | | | | | 8,060 | | |
Other comprehensive income (loss), net of tax
|
| | | | 587 | | | | | | 7,090 | | | | | | (945) | | | | | | 28,593 | | |
Comprehensive income
|
| | | | 6,457 | | | | | | 11,771 | | | | | | 71,161 | | | | | | 123,503 | | |
Comprehensive (income) loss attributable to non-controlling interest in subsidiaries
|
| | | | (762) | | | | | | 169 | | | | | | (2,025) | | | | | | 973 | | |
Comprehensive income attributable to the Company
|
| | | $ | 5,695 | | | | | $ | 11,940 | | | | | $ | 69,136 | | | | | $ | 124,476 | | |
|
(in $ thousands, except share data)
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| ||||||
Assets | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | $ | 200,333 | | | | | $ | 122,039 | | |
Accounts receivable (net of allowances for doubtful accounts of $9,753 and $10,245, respectively)
|
| | | | 248,635 | | | | | | 206,524 | | |
Other current assets
|
| | | | 125,612 | | | | | | 109,724 | | |
Total current assets
|
| | | | 574,580 | | | | | | 438,287 | | |
Property and equipment, net
|
| | | | 495,506 | | | | | | 431,741 | | |
Goodwill
|
| | | | 1,085,341 | | | | | | 1,089,590 | | |
Trademarks and tradenames
|
| | | | 313,097 | | | | | | 313,097 | | |
Other intangible assets, net
|
| | | | 444,602 | | | | | | 496,180 | | |
Deferred income taxes
|
| | | | 22,359 | | | | | | 12,796 | | |
Other non-current assets
|
| | | | 72,525 | | | | | | 76,808 | | |
Total assets
|
| | | $ | 3,008,010 | | | | | $ | 2,858,499 | | |
Liabilities and equity | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 72,094 | | | | | $ | 73,278 | | |
Accrued expenses and other current liabilities
|
| | | | 574,260 | | | | | | 509,068 | | |
Current portion of long-term debt
|
| | | | 58,377 | | | | | | 64,291 | | |
Total current liabilities
|
| | | | 704,731 | | | | | | 646,637 | | |
Long-term debt
|
| | | | 2,206,171 | | | | | | 2,165,722 | | |
Deferred income taxes
|
| | | | 37,881 | | | | | | 34,899 | | |
Other non-current liabilities
|
| | | | 191,273 | | | | | | 203,562 | | |
Total liabilities
|
| | | | 3,140,056 | | | | | | 3,050,820 | | |
Commitments and contingencies (Note 13) | | | | | | | | | | | | | |
Shareholders’ equity (deficit): | | | | | | | | | | | | | |
Preference shares ($0.0025 par value; 225,000,000 shares authorized; no shares issued and outstanding as of September 30, 2018 and December 31, 2017)
|
| | | | — | | | | | | — | | |
Common shares ($0.0025 par value; 560,000,000 shares authorized; 128,047,376 shares and 126,967,010 shares issued; 126,306,329 shares and 125,346,613 shares outstanding as of September 30, 2018 and December 31, 2017, respectively)
|
| | | | 320 | | | | | | 317 | | |
Additional paid in capital
|
| | | | 2,685,806 | | | | | | 2,700,133 | | |
Treasury shares, at cost (1,741,047 shares and 1,620,397 shares as of September 30, 2018 and December 31, 2017, respectively)
|
| | | | (26,832) | | | | | | (24,755) | | |
Accumulated deficit
|
| | | | (2,651,308) | | | | | | (2,722,375) | | |
Accumulated other comprehensive loss
|
| | | | (156,566) | | | | | | (155,621) | | |
Total shareholders’ equity (deficit)
|
| | | | (148,580) | | | | | | (202,301) | | |
Equity attributable to non-controlling interest in subsidiaries
|
| | | | 16,534 | | | | | | 9,980 | | |
Total equity (deficit)
|
| | | | (132,046) | | | | | | (192,321) | | |
Total liabilities and equity
|
| | | $ | 3,008,010 | | | | | $ | 2,858,499 | | |
|
(in $ thousands)
|
| |
Nine Months
Ended September 30, 2018 |
| |
Nine Months
Ended September 30, 2017 |
| ||||||
Operating activities | | | | | | | | | | | | | |
Net income
|
| | | $ | 72,106 | | | | | $ | 94,910 | | |
Income from discontinued operations, net of tax
|
| | | | (27,747) | | | | | | — | | |
Net income from continuing operations
|
| | | | 44,359 | | | | | | 94,910 | | |
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities:
|
| | | | | | | | | | | | |
Depreciation and amortization
|
| | | | 148,398 | | | | | | 156,871 | | |
Amortization of customer loyalty payments
|
| | | | 64,553 | | | | | | 57,348 | | |
Impairment of long-lived assets
|
| | | | 14,912 | | | | | | 685 | | |
Amortization of debt finance costs and debt discount
|
| | | | 3,613 | | | | | | 7,791 | | |
Gain on sale of a subsidiary
|
| | | | — | | | | | | (1,217) | | |
Loss on early extinguishment of debt
|
| | | | 27,699 | | | | | | 4,682 | | |
Unrealized loss (gain) on foreign exchange derivative instruments
|
| | | | 23,637 | | | | | | (27,256) | | |
Unrealized (gain) loss on interest rate derivative instruments
|
| | | | (11,651) | | | | | | 1,121 | | |
Equity-based compensation
|
| | | | 11,845 | | | | | | 24,445 | | |
Deferred income taxes
|
| | | | (7,129) | | | | | | (304) | | |
Customer loyalty payments
|
| | | | (73,349) | | | | | | (54,592) | | |
Pension liability contribution
|
| | | | (1,049) | | | | | | (1,541) | | |
Changes in assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable, net
|
| | | | (41,966) | | | | | | (39,209) | | |
Other current assets
|
| | | | (12,933) | | | | | | (7,493) | | |
Accounts payable, accrued expenses and other current liabilities
|
| | | | 84,249 | | | | | | 61,504 | | |
Other
|
| | | | 10,247 | | | | | | (3,403) | | |
Net cash provided by operating activities
|
| | | $ | 285,435 | | | | | $ | 274,342 | | |
Investing activities | | | | | | | | | | | | | |
Property and equipment additions
|
| | | $ | (109,236) | | | | | $ | (79,192) | | |
Sale of subsidiary, net of cash disposed
|
| | | | — | | | | | | (3,433) | | |
Net cash used in investing activities
|
| | | $ | (109,236) | | | | | $ | (82,625) | | |
|
(in $ thousands)
|
| |
Nine Months
Ended September 30, 2018 |
| |
Nine Months
Ended September 30, 2017 |
| ||||||
Financing activities | | | | | | | | | | | | | |
Proceeds from term loans
|
| | | $ | 1,400,000 | | | | | $ | 114,000 | | |
Proceeds from issuance of senior secured notes
|
| | | | 745,000 | | | | | | — | | |
Repayment of term loans
|
| | | | (2,161,250) | | | | | | (181,813) | | |
Repayment of capital lease obligations and other indebtedness
|
| | | | (30,632) | | | | | | (29,811) | | |
Debt finance costs and lender fees
|
| | | | (21,551) | | | | | | (686) | | |
Dividend to shareholders
|
| | | | (28,472) | | | | | | (28,234) | | |
Purchase of non-controlling interest in a subsidiary
|
| | | | — | | | | | | (1,063) | | |
Proceeds from share issuance under employee share purchase plan and stock options
|
| | | | 8,460 | | | | | | 2,016 | | |
Treasury share purchase related to vesting of equity awards
|
| | | | (2,621) | | | | | | (2,461) | | |
Other
|
| | | | (2,240) | | | | | | — | | |
Net cash used in financing activities
|
| | | $ | (93,306) | | | | | $ | (128,052) | | |
Effect of changes in exchange rates on cash, cash equivalents and restricted cash
|
| | | | (1,126) | | | | | | 1,043 | | |
Net increase in cash, cash equivalents and restricted cash
|
| | | | 81,767 | | | | | | 64,708 | | |
Cash, cash equivalents and restricted cash at beginning of period (Note 8)
|
| | | | 122,039 | | | | | | 139,938 | | |
Cash, cash equivalents and restricted cash at end of period (Note 8)
|
| | | $ | 203,806 | | | | | $ | 204,646 | | |
Supplemental disclosures of cash flow information | | | | | | | | | | | | | |
Interest payments, net of capitalized interest
|
| | | $ | 77,419 | | | | | $ | 83,294 | | |
Income tax payments, net of refunds
|
| | | | 36,933 | | | | | | 23,540 | | |
Non-cash capital lease asset additions
|
| | | | 71,511 | | | | | | 17,984 | | |
Non-cash purchase of property and equipment
|
| | | | 4,220 | | | | | | 3,120 | | |
| | |
Common Shares
|
| |
Additional
Paid in Capital |
| |
Treasury Shares
|
| |
Accumulated
Deficit |
| |
Accumulated
Other Comprehensive Loss |
| |
Non-
Controlling Interest in Subsidiaries |
| |
Total
Equity (Deficit) |
| |||||||||||||||||||||||||||||||||
(in $ thousands, except share data)
|
| |
Number
|
| |
Amount
|
| |
Number
|
| |
Amount
|
| ||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2017
|
| | | | 126,967,010 | | | | | $ | 317 | | | | | $ | 2,700,133 | | | | | | 1,620,397 | | | | | $ | (24,755) | | | | | $ | (2,722,375) | | | | | $ | (155,621) | | | | | $ | 9,980 | | | | | $ | (192,321) | | |
Change in accounting policy for revenue recognition (Note 3)
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 986 | | | | | | — | | | | | | — | | | | | | 986 | | |
Dividend to shareholders ($0.225 per
common share) |
| | | | — | | | | | | — | | | | | | (29,443) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (29,443) | | |
Equity-based compensation
|
| | | | 1,080,366 | | | | | | 3 | | | | | | 17,547 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 2,642 | | | | | | 20,192 | | |
Purchase of a non-controlling interest in a subsidiary
|
| | | | — | | | | | | — | | | | | | (1,887) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,887 | | | | | | — | | |
Treasury shares purchased in relation
to vesting of equity awards |
| | | | — | | | | | | — | | | | | | — | | | | | | 156,296 | | | | | | (2,621) | | | | | | — | | | | | | — | | | | | | — | | | | | | (2,621) | | |
Treasury shares issued in relation to vesting of equity awards
|
| | | | — | | | | | | — | | | | | | (544) | | | | | | (35,646) | | | | | | 544 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Comprehensive income, net of tax
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 70,081 | | | | | | (945) | | | | | | 2,025 | | | | | | 71,161 | | |
Balance as of September 30, 2018
|
| | | | 128,047,376 | | | | | $ | 320 | | | | | $ | 2,685,806 | | | | | | 1,741,047 | | | | | $ | (26,832) | | | | | $ | (2,651,308) | | | | | $ | (156,566) | | | | | $ | 16,534 | | | | | $ | (132,046) | | |
|
| | |
Common Shares
|
| |
Additional
Paid in Capital |
| |
Treasury Shares
|
| |
Accumulated
Deficit |
| |
Accumulated
Other Comprehensive Loss |
| |
Non-
Controlling Interest in Subsidiaries |
| |
Total
Equity (Deficit) |
| |||||||||||||||||||||||||||||||||
(in $ thousands, except share data)
|
| |
Number
|
| |
Amount
|
| |
Number
|
| |
Amount
|
| ||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2016
|
| | | | 124,941,233 | | | | | $ | 312 | | | | | $ | 2,708,836 | | | | | | 908,872 | | | | | $ | (14,166) | | | | | $ | (2,864,838) | | | | | $ | (190,072) | | | | | $ | 24,146 | | | | | $ | (335,782) | | |
Dividend to shareholders ($0.225 per
common share) |
| | | | — | | | | | | — | | | | | | (29,576) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (29,576) | | |
Purchase of non-controlling interest in a subsidiary
|
| | | | — | | | | | | — | | | | | | (47) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,016) | | | | | | (1,063) | | |
Sale of shares in a subsidiary
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (15,539) | | | | | | (15,539) | | |
Equity-based compensation
|
| | | | 608,426 | | | | | | 1 | | | | | | 22,813 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,390 | | | | | | 26,204 | | |
Treasury shares purchased in relation
to vesting of equity awards |
| | | | — | | | | | | — | | | | | | — | | | | | | 194,829 | | | | | | (2,461) | | | | | | — | | | | | | — | | | | | | — | | | | | | (2,461) | | |
Treasury shares issued in relation to vesting of equity awards
|
| | | | — | | | | | | — | | | | | | (639) | | | | | | (41,009) | | | | | | 639 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Comprehensive income, net of tax
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 95,883 | | | | | | 28,593 | | | | | | (973) | | | | | | 123,503 | | |
Balance as of September 30, 2017
|
| | | | 125,549,659 | | | | | $ | 313 | | | | | $ | 2,701,387 | | | | | | 1,062,692 | | | | | $ | (15,988) | | | | | $ | (2,768,955) | | | | | $ | (161,479) | | | | | $ | 10,008 | | | | | $ | (234,714) | | |
|
(in $ thousands)
|
| |
Three Months Ended
September 30, 2018 |
| |
Nine Months Ended
September 30, 2018 |
| ||||||
Air
|
| | | $ | 404,643 | | | | | $ | 1,321,525 | | |
Beyond Air
|
| | | | 192,968 | | | | | | 566,740 | | |
Travel Commerce Platform(1)
|
| | | | 597,611 | | | | | | 1,888,265 | | |
Technology Services
|
| | | | 24,974 | | | | | | 74,166 | | |
Net revenue
|
| | | $ | 622,585 | | | | | $ | 1,962,431 | | |
|
(in $ thousands)
|
| |
Three Months Ended
September 30, 2018 |
| |
Nine Months Ended
September 30, 2018 |
| ||||||
Asia Pacific
|
| | | $ | 140,186 | | | | | $ | 426,728 | | |
Europe
|
| | | | 202,300 | | | | | | 670,082 | | |
Latin America and Canada
|
| | | | 28,202 | | | | | | 87,517 | | |
Middle East and Africa
|
| | | | 78,824 | | | | | | 239,593 | | |
International
|
| | | | 449,512 | | | | | | 1,423,920 | | |
United States
|
| | | | 148,099 | | | | | | 464,345 | | |
Travel Commerce Platform(1)
|
| | | $ | 597,611 | | | | | $ | 1,888,265 | | |
|
| | | | | | | | |
Contract Liabilities
|
| |||||||||
(in $ thousands)
|
| |
Accounts
Receivable, net(1) |
| |
Deferred Revenue
(current)(1) |
| |
Deferred Revenue
(non-current)(1) |
| |||||||||
Balance as of September 30, 2018
|
| | | $ | 205,067 | | | | | $ | 38,406 | | | | | $ | 4,678 | | |
Balance as of January 1, 2018
|
| | | | 174,765 | | | | | | 32,010 | | | | | | 6,056 | | |
Increase (Decrease)
|
| | | $ | 30,302 | | | | | $ | 6,396 | | | | | $ | (1,378) | | |
|
(in $ thousands)
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| ||||||
Sales and use tax receivables
|
| | | $ | 32,656 | | | | | $ | 30,163 | | |
Prepaid expenses
|
| | | | 26,689 | | | | | | 24,271 | | |
Client funds
|
| | | | 25,643 | | | | | | 15,774 | | |
Prepaid incentives
|
| | | | 19,771 | | | | | | 16,677 | | |
Derivative assets
|
| | | | 11,995 | | | | | | 15,233 | | |
Other
|
| | | | 8,858 | | | | | | 7,606 | | |
| | | | $ | 125,612 | | | | | $ | 109,724 | | |
|
| | |
September 30, 2018
|
| |
December 31, 2017
|
| ||||||||||||||||||||||||||||||
(in $ thousands)
|
| |
Cost
|
| |
Accumulated
depreciation |
| |
Net
|
| |
Cost
|
| |
Accumulated
depreciation |
| |
Net
|
| ||||||||||||||||||
Capitalized software
|
| | | $ | 971,678 | | | | | $ | (761,926) | | | | | $ | 209,752 | | | | | $ | 1,029,772 | | | | | $ | (829,416) | | | | | $ | 200,356 | | |
Computer equipment
|
| | | | 337,017 | | | | | | (161,892) | | | | | | 175,125 | | | | | | 346,846 | | | | | | (207,484) | | | | | | 139,362 | | |
Building and leasehold improvements
|
| | | | 32,711 | | | | | | (15,373) | | | | | | 17,338 | | | | | | 32,834 | | | | | | (12,972) | | | | | | 19,862 | | |
Construction in progress
|
| | | | 93,291 | | | | | | — | | | | | | 93,291 | | | | | | 72,161 | | | | | | — | | | | | | 72,161 | | |
| | | | $ | 1,434,697 | | | | | $ | (939,191) | | | | | $ | 495,506 | | | | | $ | 1,481,613 | | | | | $ | (1,049,872) | | | | | $ | 431,741 | | |
|
(in $ thousands)
|
| |
January 1,
2018 |
| |
Additions
|
| |
Retirements
|
| |
Foreign
Exchange |
| |
September 30,
2018 |
| |||||||||||||||
Non-Amortizable Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Goodwill
|
| | | $ | 1,089,590 | | | | | $ | — | | | | | $ | — | | | | | $ | (4,249) | | | | | $ | 1,085,341 | | |
Trademarks and tradenames
|
| | | | 313,097 | | | | | | — | | | | | | — | | | | | | — | | | | | | 313,097 | | |
Other Intangible Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Acquired intangible assets
|
| | | | 743,549 | | | | | | — | | | | | | — | | | | | | (222) | | | | | | 743,327 | | |
Accumulated amortization
|
| | | | (461,666) | | | | | | (30,497) | | | | | | — | | | | | | 132 | | | | | | (492,031) | | |
Acquired intangible assets, net
|
| | | | 281,883 | | | | | | (30,497) | | | | | | — | | | | | | (90) | | | | | | 251,296 | | |
Customer loyalty payments
|
| | | | 380,841 | | | | | | 63,803 | | | | | | (50,833) | | | | | | (4,351) | | | | | | 389,460 | | |
Accumulated amortization
|
| | | | (166,544) | | | | | | (64,553) | | | | | | 33,048 | | | | | | 1,895 | | | | | | (196,154) | | |
Customer loyalty payments, net
|
| | | | 214,297 | | | | | | (750) | | | | | | (17,785) | | | | | | (2,456) | | | | | | 193,306 | | |
Other intangible assets, net
|
| | | $ | 496,180 | | | | | $ | (31,247) | | | | | $ | (17,785) | | | | | $ | (2,546) | | | | | $ | 444,602 | | |
|
(in $ thousands)
|
| |
January 1,
2017 |
| |
Additions
|
| |
Retirements
|
| |
Foreign
Exchange |
| |
September 30,
2017 |
| |||||||||||||||
Non-Amortizable Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Goodwill
|
| | | $ | 1,079,951 | | | | | $ | — | | | | | $ | — | | | | | $ | 8,702 | | | | | $ | 1,088,653 | | |
Trademarks and tradenames
|
| | | | 313,097 | | | | | | — | | | | | | — | | | | | | — | | | | | | 313,097 | | |
Other Intangible Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Acquired intangible assets
|
| | | | 1,127,059 | | | | | | — | | | | | | (383,715) | | | | | | 179 | | | | | | 743,523 | | |
Accumulated amortization
|
| | | | (804,089) | | | | | | (30,688) | | | | | | 383,715 | | | | | | (338) | | | | | | (451,400) | | |
Acquired intangible assets, net
|
| | | | 322,970 | | | | | | (30,688) | | | | | | — | | | | | | (159) | | | | | | 292,123 | | |
Customer loyalty payments
|
| | | | 358,259 | | | | | | 95,131 | | | | | | (73,463) | | | | | | 7,201 | | | | | | 387,128 | | |
Accumulated amortization
|
| | | | (169,622) | | | | | | (57,348) | | | | | | 69,063 | | | | | | (3,806) | | | | | | (161,713) | | |
Customer loyalty payments, net
|
| | | | 188,637 | | | | | | 37,783 | | | | | | (4,400) | | | | | | 3,395 | | | | | | 225,415 | | |
Other intangible assets, net
|
| | | $ | 511,607 | | | | | $ | 7,095 | | | | | $ | (4,400) | | | | | $ | 3,236 | | | | | $ | 517,538 | | |
|
(in $ thousands)
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| ||||||
Prepaid incentives
|
| | | $ | 32,055 | | | | | $ | 35,645 | | |
Pension assets
|
| | | | 10,013 | | | | | | 8,674 | | |
Derivative assets
|
| | | | 8,181 | | | | | | 3,503 | | |
Supplier prepayments
|
| | | | 4,312 | | | | | | 10,983 | | |
Restricted cash
|
| | | | 3,473 | | | | | | — | | |
Deferred financing costs
|
| | | | 1,620 | | | | | | 1,930 | | |
Other
|
| | | | 12,871 | | | | | | 16,073 | | |
| | | | $ | 72,525 | | | | | $ | 76,808 | | |
|
(in $ thousands)
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| ||||||
Accrued commissions and incentives
|
| | | $ | 328,361 | | | | | $ | 282,954 | | |
Accrued payroll and related
|
| | | | 81,683 | | | | | | 70,234 | | |
Deferred revenue
|
| | | | 66,381 | | | | | | 48,096 | | |
Income tax payable
|
| | | | 29,009 | | | | | | 32,986 | | |
Customer prepayments
|
| | | | 25,643 | | | | | | 15,774 | | |
Derivative liabilities
|
| | | | 13,769 | | | | | | 292 | | |
Accrued interest expense
|
| | | | 9,442 | | | | | | 12,010 | | |
Pension and post-retirement benefit liabilities
|
| | | | 1,607 | | | | | | 1,628 | | |
Other
|
| | | | 18,365 | | | | | | 45,094 | | |
| | | | $ | 574,260 | | | | | $ | 509,068 | | |
|
(in $ thousands)
|
| |
Interest
rate |
| |
Maturity
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| |||||||||
Senior Secured Credit Agreement | | | | | | | | | | | | | | | | | | | | | | |
Term loans – (2018 Credit Agreement)(1)
|
| | | | L+2.50% | | | |
March 2025
|
| | | $ | 1,379,511 | | | | | $ | — | | |
Term loans – (2014 Credit Agreement)(2)
|
| | | | L+2.75% | | | |
September 2021
|
| | | | — | | | | | | 2,124,439 | | |
Revolver borrowings – (2018 Credit
Agreement) |
| | | | L+2.25% | | | |
September 2022
|
| | | | — | | | | | | — | | |
Revolver borrowings – (2014 Credit
Agreement) |
| | | | L+2.50% | | | |
September 2022
|
| | | | — | | | | | | — | | |
Senior Secured Notes | | | | | | | | | | | | | | | | | | | | | | |
Senior secured notes(3)
|
| | | | 6.00% | | | |
March 2026
|
| | | | 737,881 | | | | | | — | | |
Capital leases and other indebtedness
|
| | | | | | | | | | | | | 147,156 | | | | | | 105,574 | | |
Total debt
|
| | | | | | | | | | | | | 2,264,548 | | | | | | 2,230,013 | | |
Less: current portion
|
| | | | | | | | | | | | | 58,377 | | | | | | 64,291 | | |
Long-term debt
|
| | | | | | | | | | | | $ | 2,206,171 | | | | | $ | 2,165,722 | | |
|
(in $ thousands) Year ending September 30, |
| |
Term
Loans |
| |
Senior Secured
Notes |
| |
Capital Leases
and Other Indebtedness |
| |||||||||
2019
|
| | | $ | 14,000 | | | | | $ | — | | | | | $ | 44,378 | | |
2020
|
| | | | 14,000 | | | | | | — | | | | | | 42,198 | | |
2021
|
| | | | 14,000 | | | | | | — | | | | | | 36,038 | | |
2022
|
| | | | 14,000 | | | | | | — | | | | | | 23,321 | | |
2023
|
| | | | 14,000 | | | | | | — | | | | | | — | | |
Thereafter
|
| | | | 1,322,500 | | | | | | 745,000 | | | | | | 1,221 | | |
| | | | | 1,392,500 | | | | | | 745,000 | | | | | | 147,156 | | |
Less: Unamortized debt finance cost
|
| | | | (6,551) | | | | | | (7,119) | | | | | | — | | |
Less: Unamortized debt discount
|
| | | | (6,438) | | | | | | — | | | | | | — | | |
Total debt
|
| | | $ | 1,379,511 | | | | | $ | 737,881 | | | | | $ | 147,156 | | |
|
(in $ thousands)
|
| |
Nine Months
Ended September 30, 2018 |
| |
Nine Months
Ended September 30, 2017 |
| ||||||
Balance as of January 1
|
| | | $ | 14,708 | | | | | $ | 22,855 | | |
Capitalization of debt finance costs
|
| | | | 14,799 | | | | | | 686 | | |
Amortization
|
| | | | (2,139) | | | | | | (4,033) | | |
Write-off on early extinguishment of debt
|
| | | | (12,078) | | | | | | (3,306) | | |
Balance as of September 30
|
| | | $ | 15,290 | | | | | $ | 16,202 | | |
|
Notional Amount ($ in thousands) |
| |
Period
|
| |
Average
Interest Rate |
| |||
1,400,000
|
| |
February 2017 to February 2019
|
| | | | 1.4010% | | |
1,200,000
|
| |
February 2019 to February 2020
|
| | | | 2.1906% | | |
400,000
|
| |
February 2020 to February 2021
|
| | | | 2.1925% | | |
200,000
|
| |
February 2021 to February 2022
|
| | | | 2.9913% | | |
(in $ thousands)
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| | | | ||||||
Interest rate swap contracts
|
| | | $ | 3,200,000 | | | | | $ | 3,000,000 | | | | ||
Foreign currency contracts
|
| | | | 439,137 | | | | | | 373,487 | | | |
| | | | | |
Fair Value Asset
|
| | | | |
Fair Value (Liability)
|
| ||||||||||||||||||
(in $ thousands)
|
| |
Balance Sheet
Location |
| |
September 30,
2018 |
| |
December 31,
2017 |
| |
Balance Sheet
Location |
| |
September 30,
2018 |
| |
December 31,
2017 |
| ||||||||||||
Interest
rate swap contracts |
| | Other current assets |
| | | $ | 11,721 | | | | | $ | 4,799 | | | | Accrued expenses and other current liabilities |
| | | $ | — | | | | | $ | — | | |
Interest
rate swap contracts |
| | Other non-current assets |
| | | | 8,181 | | | | | | 3,503 | | | | Other non-current liabilities |
| | | | — | | | | | | (51) | | |
Foreign currency
contracts |
| | Other current assets |
| | | | 274 | | | | | | 10,434 | | | | Accrued expenses and other current liabilities |
| | | | (13,769) | | | | | | (292) | | |
Total fair value of derivative assets (liabilities)
|
| | | | | | $ | 20,176 | | | | | $ | 18,736 | | | | | | | | $ | (13,769) | | | | | $ | (343) | | |
|
(in $ thousands)
|
| |
Nine Months Ended
September 30, 2018 |
| |
Nine Months Ended
September 30, 2017 |
| ||||||
Net derivative asset (liability) opening balance
|
| | | $ | 18,393 | | | | | $ | (19,196) | | |
Total (loss) gain for the period included in net income
|
| | | | (460) | | | | | | 12,099 | | |
(Proceeds from) payments on settlement of derivative contracts
|
| | | | (11,526) | | | | | | 13,495 | | |
Net derivative asset closing balance
|
| | | $ | 6,407 | | | | | $ | 6,398 | | |
|
| | | | | |
Amount of Gain (Loss)
Recorded in Net Income |
| |||||||||||||||||||||
| | | | | |
Three Months Ended
September 30, |
| |
Nine Months Ended
September 30, |
| ||||||||||||||||||
(in $ thousands)
|
| |
Statement of Operations Location
|
| |
2018
|
| |
2017
|
| |
2018
|
| |
2017
|
| ||||||||||||
Interest rate swap
contracts |
| | Interest expense, net | | | | $ | 2,143 | | | | | $ | 1,332 | | | | | | 18,231 | | | | | | (3,322) | | |
Foreign currency
contracts |
| |
Selling, general and administrative
|
| | | | (5,701) | | | | | | 4,238 | | | | | | (18,691) | | | | | | 15,421 | | |
| | | | | | | $ | (3,558) | | | | | $ | 5,570 | | | | | | (460) | | | | | | 12,099 | | |
| | | | | |
September 30, 2018
|
| |
December 31, 2017
|
| ||||||||||||||||||
(in $ thousands)
|
| |
Fair Value
Hierarchy |
| |
Carrying
Amount |
| |
Fair Value
|
| |
Carrying
Amount |
| |
Fair Value
|
| ||||||||||||
Asset (liability) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Derivative assets
|
| |
Level 2
|
| | | $ | 20,176 | | | | | $ | 20,176 | | | | | $ | 18,736 | | | | | $ | 18,736 | | |
Derivative liabilities
|
| |
Level 2
|
| | | | (13,769) | | | | | | (13,769) | | | | | | (343) | | | | | | (343) | | |
Total debt
|
| |
Level 2
|
| | | | (2,264,548) | | | | | | (2,291,939) | | | | | | (2,230,013) | | | | | | (2,258,893) | | |
Declaration Date
|
| |
Dividend
Per Share |
| |
Record
Date |
| |
Payment
Date |
| |
Amount
(in $ thousands) |
| ||||||
February 16, 2018
|
| | | $ | 0.075 | | | |
March 1, 2018
|
| |
March 15, 2018
|
| | | $ | 9,406 | | |
May 2, 2018
|
| | | | 0.075 | | | |
June 7, 2018
|
| |
June 21, 2018
|
| | | | 9,459 | | |
August 1, 2018
|
| | | | 0.075 | | | |
September 6, 2018
|
| |
September 20, 2018
|
| | | | 9,473 | | |
(in dollars, except number of RSUs)
|
| |
Number
|
| |
Weighted
Average Grant Date Fair Value |
| ||||||
Balance as of January 1, 2018
|
| | | | 1,526,280 | | | | | $ | 13.01 | | |
Granted at fair market value
|
| | | | 857,133 | | | | | $ | 14.62 | | |
Vested(1) | | | | | (433,359) | | | | | $ | 12.95 | | |
Forfeited
|
| | | | (316,898) | | | | | $ | 13.31 | | |
Balance as of September 30, 2018
|
| | | | 1,633,156 | | | | | $ | 13.81 | | |
|
(in dollars, except number of PSUs)
|
| |
Number
|
| |
Weighted
Average Grant Date Fair Value |
| ||||||
Balance as of January 1, 2018
|
| | | | 2,694,999 | | | | | $ | 13.10 | | |
Granted at fair market value
|
| | | | 1,444,522 | | | | | $ | 16.33 | | |
Forfeited
|
| | | | (825,573) | | | | | $ | 13.57 | | |
Vested(1) | | | | | (11,290) | | | | | $ | 15.50 | | |
Balance as of September 30, 2018(2)
|
| | | | 3,302,658 | | | | | $ | 14.37 | | |
|
| | |
Number of
Options |
| |
Weighted Average
Exercise Price (in dollars) |
| |
Weighted Average
Remaining Contractual Terms (in years) |
| |
Aggregate
Intrinsic Value (in $ thousands) |
| ||||||||||||
Balance as of January 1, 2018
|
| | | | 2,352,928 | | | | | $ | 13.51 | | | | | | | | | | | | | | |
Forfeited
|
| | | | (253,643) | | | | | $ | 13.72 | | | | | | | | | | | | | | |
Exercised
|
| | | | (594,616) | | | | | $ | 11.68 | | | | | | | | | | | | | | |
Expired
|
| | | | (46,112) | | | | | $ | 15.58 | | | | | | | | | | | | | | |
Balance as of September 30, 2018
|
| | | | 1,458,557 | | | | | $ | 14.15 | | | | | | 7.01 | | | | | $ | 3,984 | | |
Exercisable as of September 30, 2018
|
| | | | 782,037 | | | | | $ | 14.48 | | | | | | 6.83 | | | | | $ | 1,880 | | |
Expected to vest as of September 30, 2018
|
| | | | 676,520 | | | | | $ | 13.77 | | | | | | 7.23 | | | | | $ | 2,104 | | |
|
| | |
Three Months Ended
September 30, |
| |
Nine Months Ended
September 30, |
| ||||||||||||||||||
(in $ thousands, except for share data)
|
| |
2018
|
| |
2017
|
| |
2018
|
| |
2017
|
| ||||||||||||
Numerator – Basic and Diluted Income per Share:
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Net income from continuing operations
|
| | | $ | 5,870 | | | | | $ | 4,681 | | | | | $ | 44,359 | | | | | $ | 94,910 | | |
Net (income) loss attributable to non-controlling interest in subsidiaries
|
| | | | (762) | | | | | | 169 | | | | | | (2,025) | | | | | | 973 | | |
Net income from continuing operations attributable to the Company
|
| | | $ | 5,108 | | | | | $ | 4,850 | | | | | $ | 42,334 | | | | | $ | 95,883 | | |
Denominator – Basic Income per Share: | | | | | | | | | | | | | | | | | | | | | | | | | |
Weighted average common shares outstanding
|
| | | | 126,246,210 | | | | | | 124,469,069 | | | | | | 125,908,707 | | | | | | 124,303,716 | | |
Income per share from continuing operations – Basic
|
| | | $ | 0.04 | | | | | $ | 0.04 | | | | | $ | 0.34 | | | | | $ | 0.77 | | |
Denominator – Diluted Income per Share: | | | | | | | | | | | | | | | | | | | | | | | | | |
Number of common shares used for basic income per share from continuing operations
|
| | | | 126,246,210 | | | | | | 124,469,069 | | | | | | 125,908,707 | | | | | | 124,303,716 | | |
Weighted average effect of dilutive securities
|
| | | | | | | | | | | | | | | | | | | | | | | | |
RSUs/PSUs
|
| | | | 1,881,201 | | | | | | 1,603,721 | | | | | | 1,819,470 | | | | | | 1,424,009 | | |
Stock options
|
| | | | 261,974 | | | | | | 115,582 | | | | | | 126,301 | | | | | | 99,815 | | |
Weighted average common shares outstanding
|
| | | | 128,389,385 | | | | | | 126,188,372 | | | | | | 127,854,478 | | | | | | 125,827,540 | | |
Income per share from continuing operations – Diluted
|
| | | $ | 0.04 | | | | | $ | 0.04 | | | | | $ | 0.33 | | | | | $ | 0.76 | | |
|
(in $ thousands, except share data,
Reported Segments and RevPas) |
| |
Three Months
Ended September 30, |
| |
Change
|
| |
Nine Months
Ended September 30, |
| |
Change
|
| ||||||||||||||||||||||||||||||||||||
|
2018
|
| |
2017
|
| | | | | | | |
%
|
| |
2018
|
| |
2017
|
| | | | | | | |
%
|
| ||||||||||||||||||||
Net revenue
|
| | | $ | 622,585 | | | | | $ | 610,842 | | | | | $ | 11,743 | | | | | | 2 | | | | | $ | 1,962,431 | | | | | $ | 1,873,712 | | | | | $ | 88,719 | | | | | | 5 | | |
Operating income
|
| | | | 44,115 | | | | | | 61,585 | | | | | | (17,470) | | | | | | (28) | | | | | | 164,072 | | | | | | 235,997 | | | | | | (71,925) | | | | | | (30) | | |
Net income
|
| | | | 5,870 | | | | | | 4,681 | | | | | | 1,189 | | | | | | 25 | | | | | | 72,106 | | | | | | 94,910 | | | | | | (22,804) | | | | | | (24) | | |
Income per share – diluted (in $)
|
| | | | 0.04 | | | | | | 0.04 | | | | | | — | | | | | | 4 | | | | | | 0.55 | | | | | | 0.76 | | | | | | (0.21) | | | | | | (28) | | |
Adjusted EBITDA(1)
|
| | | | 139,313 | | | | | | 136,437 | | | | | | 2,876 | | | | | | 2 | | | | | | 450,413 | | | | | | 451,996 | | | | | | (1,583) | | | | | | — | | |
Adjusted Operating Income(2)
|
| | | | 79,219 | | | | | | 76,392 | | | | | | 2,827 | | | | | | 4 | | | | | | 268,211 | | | | | | 268,465 | | | | | | (254) | | | | | | — | | |
Adjusted Net Income(3)
|
| | | | 40,040 | | | | | | 22,671 | | | | | | 17,369 | | | | | | 77 | | | | | | 146,906 | | | | | | 137,034 | | | | | | 9,872 | | | | | | 7 | | |
Adjusted Income per Share –
diluted(4) (in $) |
| | | | 0.31 | | | | | | 0.18 | | | | | | 0.13 | | | | | | 74 | | | | | | 1.15 | | | | | | 1.09 | | | | | | 0.06 | | | | | | 6 | | |
Net cash provided by operating activities
|
| | | | 83,149 | | | | | | 95,735 | | | | | | (12,586) | | | | | | (13) | | | | | | 285,435 | | | | | | 274,342 | | | | | | 11,093 | | | | | | 4 | | |
Free Cash Flow(5)
|
| | | | 48,379 | | | | | | 63,372 | | | | | | (14,993) | | | | | | (24) | | | | | | 176,199 | | | | | | 195,150 | | | | | | (18,951) | | | | | | (10) | | |
Reported Segments (in thousands)
|
| | | | 81,579 | | | | | | 85,397 | | | | | | (3,818) | | | | | | (4) | | | | | | 260,831 | | | | | | 264,975 | | | | | | (4,144) | | | | | | (2) | | |
Travel Commerce Platform RevPas (in $)
|
| | | | 7.33 | | | | | | 6.86 | | | | | | 0.47 | | | | | | 7 | | | | | | 7.24 | | | | | | 6.76 | | | | | | 0.48 | | | | | | 7 | | |
| | |
Three Months
Ended September 30, |
| |
Nine Months
Ended September 30, |
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
2018
|
| |
2017
|
| ||||||||||||
Net income
|
| | | $ | 5,870 | | | | | $ | 4,681 | | | | | $ | 72,106 | | | | | $ | 94,910 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | |
Amortization of acquired intangible assets(1)
|
| | | | 10,165 | | | | | | 10,165 | | | | | | 30,497 | | | | | | 30,688 | | |
Gain on sale of a subsidiary
|
| | | | — | | | | | | — | | | | | | — | | | | | | (1,217) | | |
Loss on early extinguishment of debt
|
| | | | 38 | | | | | | 4,682 | | | | | | 27,699 | | | | | | 4,682 | | |
Equity-based compensation and related taxes
|
| | | | (207) | | | | | | 8,676 | | | | | | 11,837 | | | | | | 24,355 | | |
Corporate and restructuring costs(2)
|
| | | | 19,472 | | | | | | 4,217 | | | | | | 24,704 | | | | | | 14,897 | | |
Impairment of long-lived assets(3)
|
| | | | 3,269 | | | | | | — | | | | | | 14,912 | | | | | | 685 | | |
Income from discontinued operations
|
| | | | — | | | | | | — | | | | | | (27,747) | | | | | | — | | |
Other – non-cash(4)
|
| | | | 3,580 | | | | | | (9,285) | | | | | | 10,538 | | | | | | (34,498) | | |
Tax adjustments(5)
|
| | | | (2,147) | | | | | | (465) | | | | | | (17,640) | | | | | | 2,532 | | |
Adjusted Net Income
|
| | | | 40,040 | | | | | | 22,671 | | | | | | 146,906 | | | | | | 137,034 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest expense, net(6)
|
| | | | 26,597 | | | | | | 30,673 | | | | | | 77,963 | | | | | | 90,890 | | |
Other expense(7)
|
| | | | 266 | | | | | | — | | | | | | 730 | | | | | | — | | |
Remaining provision for income taxes
|
| | | | 12,316 | | | | | | 23,048 | | | | | | 42,612 | | | | | | 40,541 | | |
Adjusted Operating Income
|
| | | | 79,219 | | | | | | 76,392 | | | | | | 268,211 | | | | | | 268,465 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization of property and equipment
|
| | | | 40,032 | | | | | | 40,149 | | | | | | 117,649 | | | | | | 126,183 | | |
Amortization of customer loyalty payments
|
| | | | 20,062 | | | | | | 19,896 | | | | | | 64,553 | | | | | | 57,348 | | |
Adjusted EBITDA
|
| | | $ | 139,313 | | | | | $ | 136,437 | | | | | $ | 450,413 | | | | | $ | 451,996 | | |
|
| | |
Three Months
Ended September 30, |
| |
Nine Months
Ended September 30, |
| ||||||||||||||||||
(in $)
|
| |
2018
|
| |
2017
|
| |
2018
|
| |
2017
|
| ||||||||||||
Income per share – diluted
|
| | | $ | 0.04 | | | | | $ | 0.04 | | | | | $ | 0.55 | | | | | $ | 0.76 | | |
Per share adjustments to net income to determine Adjusted Income per Share – diluted
|
| | | | 0.27 | | | | | | 0.14 | | | | | | 0.60 | | | | | | 0.33 | | |
Adjusted Income per Share – diluted
|
| | | $ | 0.31 | | | | | $ | 0.18 | | | | | $ | 1.15 | | | | | $ | 1.09 | | |
|
| | |
Nine Months Ended
September 30, |
| |||||||||
(in percentages)
|
| |
2018
|
| |
2017
|
| ||||||
Asia Pacific
|
| | | | 23 | | | | | | 24 | | |
Europe
|
| | | | 34 | | | | | | 32 | | |
Latin America and Canada
|
| | | | 5 | | | | | | 5 | | |
Middle East and Africa
|
| | | | 13 | | | | | | 13 | | |
International
|
| | | | 75 | | | | | | 74 | | |
United States
|
| | | | 25 | | | | | | 26 | | |
Travel Commerce Platform
|
| | | | 100 | | | | | | 100 | | |
|
| | |
Three Months
Ended September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Net revenue
|
| | | $ | 622,585 | | | | | $ | 610,842 | | | | | $ | 11,743 | | | | | | 2 | | |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenue
|
| | | | 400,679 | | | | | | 388,027 | | | | | | 12,652 | | | | | | 3 | | |
Selling, general and administrative
|
| | | | 127,538 | | | | | | 110,916 | | | | | | 16,622 | | | | | | 15 | | |
Depreciation and amortization
|
| | | | 50,253 | | | | | | 50,314 | | | | | | (61) | | | | | | — | | |
Total costs and expenses
|
| | | | 578,470 | | | | | | 549,257 | | | | | | 29,213 | | | | | | 5 | | |
Operating income
|
| | | | 44,115 | | | | | | 61,585 | | | | | | (17,470) | | | | | | (28) | | |
Interest expense, net
|
| | | | (27,772) | | | | | | (28,793) | | | | | | 1,021 | | | | | | 4 | | |
Loss on early extinguishment of debt
|
| | | | (38) | | | | | | (4,682) | | | | | | 4,644 | | | | | | 99 | | |
Other expense
|
| | | | (266) | | | | | | (846) | | | | | | 580 | | | | | | 69 | | |
Income before income taxes
|
| | | | 16,039 | | | | | | 27,264 | | | | | | (11,225) | | | | | | (41) | | |
Provision for income taxes
|
| | | | (10,169) | | | | | | (22,583) | | | | | | 12,414 | | | | | | 55 | | |
Net income
|
| | | $ | 5,870 | | | | | $ | 4,681 | | | | | $ | 1,189 | | | | | | 25 | | |
|
| | |
Three Months
Ended September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Air
|
| | | $ | 404,643 | | | | | $ | 417,371 | | | | | $ | (12,728) | | | | | | (3) | | |
Beyond Air
|
| | | | 192,968 | | | | | | 168,782 | | | | | | 24,186 | | | | | | 14 | | |
Travel Commerce Platform
|
| | | | 597,611 | | | | | | 586,153 | | | | | | 11,458 | | | | | | 2 | | |
Technology Services
|
| | | | 24,974 | | | | | | 24,689 | | | | | | 285 | | | | | | 1 | | |
Net revenue
|
| | | $ | 622,585 | | | | | $ | 610,842 | | | | | $ | 11,743 | | | | | | 2 | | |
|
| | |
Three Months
Ended September 30, |
| |
Change
|
| ||||||||||||||||||
| | |
2018
|
| |
2017
|
| | | | | | | |
%
|
| |||||||||
Travel Commerce Platform RevPas (in $)
|
| | | $ | 7.33 | | | | | $ | 6.86 | | | | | $ | 0.47 | | | | | | 7 | | |
Reported Segments (in thousands)
|
| | | | 81,579 | | | | | | 85,397 | | | | | | (3,818) | | | | | | (4) | | |
| | |
Three Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Asia Pacific
|
| | | $ | 140,186 | | | | | $ | 145,008 | | | | | $ | (4,822) | | | | | | (3) | | |
Europe
|
| | | | 202,300 | | | | | | 185,801 | | | | | | 16,499 | | | | | | 9 | | |
Latin America and Canada
|
| | | | 28,202 | | | | | | 27,563 | | | | | | 639 | | | | | | 2 | | |
Middle East and Africa
|
| | | | 78,824 | | | | | | 77,494 | | | | | | 1,330 | | | | | | 2 | | |
International
|
| | | | 449,512 | | | | | | 435,866 | | | | | | 13,646 | | | | | | 3 | | |
United States
|
| | | | 148,099 | | | | | | 150,287 | | | | | | (2,188) | | | | | | (1) | | |
Travel Commerce Platform
|
| | | $ | 597,611 | | | | | $ | 586,153 | | | | | $ | 11,458 | | | | | | 2 | | |
|
| | |
Segments (in thousands)
|
| |
RevPas (in $)
|
| ||||||||||||||||||||||||||||||||||||||||||
| | |
Three Months Ended
September 30, |
| |
Change
|
| |
Three Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||||||||||||||||||||
| | |
2018
|
| |
2017
|
| | | | | | | |
%
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| |||||||||||||||||||||
Asia Pacific
|
| | | | 16,764 | | | | | | 17,807 | | | | | | (1,043) | | | | | | (6) | | | | | $ | 8.36 | | | | | $ | 8.14 | | | | | | 0.22 | | | | | | 3 | | |
Europe
|
| | | | 18,658 | | | | | | 20,117 | | | | | | (1,459) | | | | | | (7) | | | | | $ | 10.84 | | | | | $ | 9.24 | | | | | | 1.60 | | | | | | 17 | | |
Latin America and Canada
|
| | | | 4,793 | | | | | | 4,706 | | | | | | 87 | | | | | | 2 | | | | | $ | 5.88 | | | | | $ | 5.86 | | | | | | 0.02 | | | | | | — | | |
Middle East and Africa
|
| | | | 9,180 | | | | | | 9,354 | | | | | | (174) | | | | | | (2) | | | | | $ | 8.59 | | | | | $ | 8.28 | | | | | | 0.31 | | | | | | 4 | | |
International
|
| | | | 49,395 | | | | | | 51,984 | | | | | | (2,589) | | | | | | (5) | | | | | $ | 9.10 | | | | | $ | 8.38 | | | | | | 0.72 | | | | | | 9 | | |
United States
|
| | | | 32,184 | | | | | | 33,413 | | | | | | (1,229) | | | | | | (4) | | | | | $ | 4.60 | | | | | $ | 4.50 | | | | | | 0.10 | | | | | | 2 | | |
Travel Commerce Platform
|
| | | | 81,579 | | | | | | 85,397 | | | | | | (3,818) | | | | | | (4) | | | | | $ | 7.33 | | | | | $ | 6.86 | | | | | | 0.47 | | | | | | 7 | | |
|
| | |
Three Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Commissions
|
| | | $ | 327,516 | | | | | $ | 306,971 | | | | | $ | 20,545 | | | | | | 7 | | |
Technology costs
|
| | | | 73,163 | | | | | | 81,056 | | | | | | (7,893) | | | | | | (10) | | |
Cost of revenue
|
| | | $ | 400,679 | | | | | $ | 388,027 | | | | | $ | 12,652 | | | | | | 3 | | |
|
| | |
Three Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Workforce
|
| | | $ | 83,585 | | | | | $ | 90,559 | | | | | $ | (6,974) | | | | | | (8) | | |
Non-workforce
|
| | | | 22,327 | | | | | | 14,869 | | | | | | 7,458 | | | | | | 50 | | |
Sub-total
|
| | | | 105,912 | | | | | | 105,428 | | | | | | 484 | | | | | | — | | |
Non-core corporate costs
|
| | | | 21,626 | | | | | | 5,488 | | | | | | 16,138 | | | | | | * | | |
SG&A | | | | $ | 127,538 | | | | | $ | 110,916 | | | | | $ | 16,622 | | | | | | 15 | | |
|
| | |
Three Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Depreciation on property and equipment
|
| | | $ | 40,088 | | | | | $ | 40,149 | | | | | $ | (61) | | | | | | — | | |
Amortization of acquired intangible assets
|
| | | | 10,165 | | | | | | 10,165 | | | | | | — | | | | | | — | | |
Total depreciation and amortization
|
| | | $ | 50,253 | | | | | $ | 50,314 | | | | | $ | (61) | | | | | | — | | |
|
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Net revenue
|
| | | $ | 1,962,431 | | | | | $ | 1,873,712 | | | | | $ | 88,719 | | | | | | 5 | | |
Costs and expenses | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenue
|
| | | | 1,254,868 | | | | | | 1,144,572 | | | | | | 110,296 | | | | | | 10 | | |
Selling, general and administrative
|
| | | | 395,093 | | | | | | 336,272 | | | | | | 58,821 | | | | | | 17 | | |
Depreciation and amortization
|
| | | | 148,398 | | | | | | 156,871 | | | | | | (8,473) | | | | | | (5) | | |
Total costs and expenses
|
| | | | 1,798,359 | | | | | | 1,637,715 | | | | | | 160,644 | | | | | | 10 | | |
Operating income
|
| | | | 164,072 | | | | | | 235,997 | | | | | | (71,925) | | | | | | (30) | | |
Interest expense, net
|
| | | | (66,312) | | | | | | (92,011) | | | | | | 25,699 | | | | | | 28 | | |
Loss on early extinguishment of debt
|
| | | | (27,699) | | | | | | (4,682) | | | | | | (23,017) | | | | | | * | | |
Gain on sale of a subsidiary
|
| | | | — | | | | | | 1,217 | | | | | | (1,217) | | | | | | (100) | | |
Other expense
|
| | | | (730) | | | | | | (2,538) | | | | | | 1,808 | | | | | | 71 | | |
Income before income taxes
|
| | | | 69,331 | | | | | | 137,983 | | | | | | (68,652) | | | | | | (50) | | |
Provision for income taxes
|
| | | | (24,972) | | | | | | (43,073) | | | | | | 18,101 | | | | | | 42 | | |
Net income from continuing operations
|
| | | | 44,359 | | | | | | 94,910 | | | | | | (50,551) | | | | | | (53) | | |
Income from discontinued operations, net of tax
|
| | | | 27,747 | | | | | | — | | | | | | 27,747 | | | | | | * | | |
Net income
|
| | | $ | 72,106 | | | | | $ | 94,910 | | | | | $ | (22,804) | | | | | | (24) | | |
|
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Air
|
| | | $ | 1,321,525 | | | | | $ | 1,315,500 | | | | | $ | 6,025 | | | | | | — | | |
Beyond Air
|
| | | | 566,740 | | | | | | 476,474 | | | | | | 90,266 | | | | | | 19 | | |
Travel Commerce Platform
|
| | | | 1,888,265 | | | | | | 1,791,974 | | | | | | 96,291 | | | | | | 5 | | |
Technology Services
|
| | | | 74,166 | | | | | | 81,738 | | | | | | (7,572) | | | | | | (9) | | |
Net revenue
|
| | | $ | 1,962,431 | | | | | $ | 1,873,712 | | | | | $ | 88,719 | | | | | | 5 | | |
|
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
| | |
2018
|
| |
2017
|
| | | | | | | |
%
|
| |||||||||
Travel Commerce Platform RevPas (in $)
|
| | | $ | 7.24 | | | | | $ | 6.76 | | | | | $ | 0.48 | | | | | | 7 | | |
Reported Segments (in thousands)
|
| | | | 260,831 | | | | | | 264,975 | | | | | | (4,144) | | | | | | (2) | | |
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Asia Pacific
|
| | | $ | 426,728 | | | | | $ | 437,748 | | | | | $ | (11,020) | | | | | | (3) | | |
Europe
|
| | | | 670,082 | | | | | | 568,811 | | | | | | 101,271 | | | | | | 18 | | |
Latin America and Canada
|
| | | | 87,517 | | | | | | 83,919 | | | | | | 3,598 | | | | | | 4 | | |
Middle East and Africa
|
| | | | 239,593 | | | | | | 238,959 | | | | | | 634 | | | | | | — | | |
International
|
| | | | 1,423,920 | | | | | | 1,329,437 | | | | | | 94,483 | | | | | | 7 | | |
United States
|
| | | | 464,345 | | | | | | 462,537 | | | | | | 1,808 | | | | | | — | | |
Travel Commerce Platform
|
| | | $ | 1,888,265 | | | | | $ | 1,791,974 | | | | | $ | 96,291 | | | | | | 5 | | |
|
| | |
Segments (in thousands)
|
| |
RevPas (in $)
|
| ||||||||||||||||||||||||||||||||||||||||||
| | |
Nine Months Ended
September 30, |
| |
Change
|
| |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||||||||||||||||||||
| | |
2018
|
| |
2017
|
| | | | | | | |
%
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| |||||||||||||||||||||
Asia Pacific
|
| | | | 49,172 | | | | | | 54,712 | | | | | | (5,540) | | | | | | (10) | | | | | $ | 8.68 | | | | | $ | 8.00 | | | | | | 0.68 | | | | | | 8 | | |
Europe
|
| | | | 65,537 | | | | | | 63,478 | | | | | | 2,059 | | | | | | 3 | | | | | $ | 10.22 | | | | | $ | 8.96 | | | | | | 1.26 | | | | | | 14 | | |
Latin America and Canada
|
| | | | 14,231 | | | | | | 13,862 | | | | | | 369 | | | | | | 3 | | | | | $ | 6.15 | | | | | $ | 6.05 | | | | | | 0.10 | | | | | | 2 | | |
Middle East and Africa
|
| | | | 28,300 | | | | | | 28,271 | | | | | | 29 | | | | | | — | | | | | $ | 8.47 | | | | | $ | 8.45 | | | | | | 0.02 | | | | | | — | | |
International
|
| | | | 157,240 | | | | | | 160,323 | | | | | | (3,083) | | | | | | (2) | | | | | $ | 9.06 | | | | | $ | 8.29 | | | | | | 0.77 | | | | | | 9 | | |
United States
|
| | | | 103,591 | | | | | | 104,652 | | | | | | (1,061) | | | | | | (1) | | | | | $ | 4.48 | | | | | $ | 4.42 | | | | | | 0.06 | | | | | | 1 | | |
Travel Commerce Platform
|
| | | | 260,831 | | | | | | 264,975 | | | | | | (4,144) | | | | | | (2) | | | | | $ | 7.24 | | | | | $ | 6.76 | | | | | | 0.48 | | | | | | 7 | | |
|
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Commissions
|
| | | $ | 1,026,602 | | | | | $ | 899,224 | | | | | $ | 127,378 | | | | | | 14 | | |
Technology costs
|
| | | | 228,266 | | | | | | 245,348 | | | | | | (17,082) | | | | | | (7) | | |
Cost of revenue
|
| | | $ | 1,254,868 | | | | | $ | 1,144,572 | | | | | $ | 110,296 | | | | | | 10 | | |
|
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Workforce
|
| | | $ | 276,572 | | | | | $ | 267,699 | | | | | $ | 8,873 | | | | | | 3 | | |
Non-workforce
|
| | | | 58,753 | | | | | | 56,644 | | | | | | 2,109 | | | | | | 4 | | |
Sub-total
|
| | | | 335,325 | | | | | | 324,343 | | | | | | 10,982 | | | | | | 3 | | |
Non-core corporate costs
|
| | | | 59,768 | | | | | | 11,929 | | | | | | 47,839 | | | | | | * | | |
SG&A | | | | $ | 395,093 | | | | | $ | 336,272 | | | | | $ | 58,821 | | | | | | 17 | | |
|
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |
%
|
| ||||||||||||
Depreciation on property and equipment
|
| | | $ | 117,901 | | | | | $ | 126,183 | | | | | $ | (8,282) | | | | | | (7) | | |
Amortization of acquired intangible assets
|
| | | | 30,497 | | | | | | 30,688 | | | | | | (191) | | | | | | (1) | | |
Total depreciation and amortization
|
| | | $ | 148,398 | | | | | $ | 156,871 | | | | | $ | (8,473) | | | | | | (5) | | |
|
(in $ thousands)
|
| |
September 30,
2018 |
| |||
Cash and cash equivalents
|
| | | $ | 200,333 | | |
Revolving credit facility availability
|
| | | | 145,400 | | |
| | |
Asset (Liability)
|
| | ||||||||||||||
(in $ thousands)
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| |
Change
|
| |||||||||
Accounts receivable, net
|
| | | $ | 248,635 | | | | | $ | 206,524 | | | | | $ | 42,111 | | |
Accrued commissions and incentives
|
| | | | (328,361) | | | | | | (282,954) | | | | | | (45,407) | | |
Deferred revenue and prepaid incentives, net
|
| | | | (46,610) | | | | | | (31,419) | | | | | | (15,191) | | |
Cash and cash equivalents
|
| | | | 200,333 | | | | | | 122,039 | | | | | | 78,294 | | |
Accounts payable and employee related
|
| | | | (155,384) | | | | | | (145,140) | | | | | | (10,244) | | |
Accrued interest
|
| | | | (9,442) | | | | | | (12,010) | | | | | | 2,568 | | |
Current portion of long-term debt
|
| | | | (58,377) | | | | | | (64,291) | | | | | | 5,914 | | |
Taxes
|
| | | | 3,647 | | | | | | (2,823) | | | | | | 6,470 | | |
Other assets, net
|
| | | | 15,408 | | | | | | 1,724 | | | | | | 13,684 | | |
Working Capital
|
| | | $ | (130,151) | | | | | $ | (208,350) | | | | | $ | 78,199 | | |
Consolidated Condensed Balance Sheets: | | | | | | | | | | | | | | | | | | | |
Total current assets
|
| | | $ | 574,580 | | | | | $ | 438,287 | | | | | $ | 136,293 | | |
Total current liabilities
|
| | | | (704,731) | | | | | | (646,637) | | | | | | (58,094) | | |
Working Capital
|
| | | $ | (130,151) | | | | | $ | (208,350) | | | | | $ | 78,199 | | |
|
| | |
September 30,
2018 |
| |
December 31,
2017 |
| |
Change
|
| |||||||||
Accounts receivable, net (in $ thousands)
|
| | | $ | 248,635 | | | | | $ | 206,524 | | | | | $ | 42,111 | | |
Accounts receivable, net – Days Sales Outstanding (“DSO”)
|
| | | | 37 | | | | | | 37 | | | | | | — | | |
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |||||||||
Cash provided by (used in): | | | | | | | | | | | | | | | | | | | |
Operating activities
|
| | | $ | 285,435 | | | | | $ | 274,342 | | | | | $ | 11,093 | | |
Investing activities
|
| | | | (109,236) | | | | | | (82,625) | | | | | | (26,611) | | |
Financing activities
|
| | | | (93,306) | | | | | | (128,052) | | | | | | 34,746 | | |
Effect of exchange rate changes
|
| | | | (1,126) | | | | | | 1,043 | | | | | | (2,169) | | |
Net increase in cash, cash equivalents and restricted cash
|
| | | $ | 81,767 | | | | | $ | 64,708 | | | | | $ | 17,059 | | |
|
| | |
Nine Months Ended
September 30, |
| |
Change
|
| ||||||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| |
$
|
| |||||||||
Cash additions to software developed for internal use
|
| | | $ | 96,934 | | | | | $ | 62,459 | | | | | $ | 34,475 | | |
Cash additions to computer equipment and other
|
| | | | 12,302 | | | | | | 16,733 | | | | | | (4,431) | | |
Property and equipment additions
|
| | | $ | 109,236 | | | | | $ | 79,192 | | | | | $ | 30,044 | | |
|
| | |
Nine Months Ended
September 30, |
| |||||||||
(in $ thousands)
|
| |
2018
|
| |
2017
|
| ||||||
Net cash provided by operating activities
|
| | | $ | 285,435 | | | | | $ | 274,342 | | |
Less: capital expenditures on property and equipment additions
|
| | | | (109,236) | | | | | | (79,192) | | |
Free Cash Flow
|
| | | $ | 176,199 | | | | | $ | 195,150 | | |
|
(in $ thousands)
|
| |
Interest rate
|
| |
Maturity
|
| |
September 30,
2018 |
| |
December 31,
2017 |
| ||||||
Senior Secured Credit Agreement | | | | | | | | | | | | | | | | | | | |
Term loans – (2018 Credit Agreement)(1)
|
| |
L+2.50%
|
| |
March 2025
|
| | | $ | 1,379,511 | | | | | $ | — | | |
Term loans – (2014 Credit Agreement)(2)
|
| |
L+2.75%
|
| |
September 2021
|
| | | | — | | | | | | 2,124,439 | | |
Revolver borrowings – (2018 Credit Agreement)
|
| |
L+2.25%
|
| |
September 2022
|
| | | | — | | | | | | — | | |
Revolver borrowings – (2014 Credit Agreement)
|
| |
L+2.50%
|
| |
September 2022
|
| | | | — | | | | | | — | | |
Senior Secured Notes | | | | | | | | | | | | | | | | | | | |
Senior Secured Notes(3)
|
| |
6.00%
|
| |
March 2026
|
| | | | 737,881 | | | | | | — | | |
Capital leases and other indebtedness
|
| | | | | | | | | | 147,156 | | | | | | 105,574 | | |
Total debt
|
| | | | | | | | | | 2,264,548 | | | | | | 2,230,013 | | |
Less: cash, cash equivalents and restricted cash
|
| | | | | | | | | | (203,806) | | | | | | (122,039) | | |
Net Debt(4)
|
| | | | | | | | | $ | 2,060,742 | | | | | $ | 2,107,974 | | |
|
Notional Amount ($ in thousands) |
| |
Period
|
| |
Rate
Average Interest |
| |||
1,400,000
|
| |
February 2017 to February 2019
|
| | | | 1.4010% | | |
1,200,000
|
| |
February 2019 to February 2020
|
| | | | 2.1906% | | |
400,000
|
| |
February 2020 to February 2021
|
| | | | 2.1925% | | |
200,000
|
| |
February 2021 to February 2022
|
| | | | 2.9913% | | |
| | |
Year Ending September 30,
|
| |||||||||||||||||||||||||||||||||||||||
(in $ thousands)
|
| |
2019
|
| |
2020
|
| |
2021
|
| |
2022
|
| |
2023
|
| |
Thereafter
|
| |
Total
|
| |||||||||||||||||||||
Term loans
|
| | | $ | 14,000 | | | | | $ | 14,000 | | | | | $ | 14,000 | | | | | $ | 14,000 | | | | | $ | 14,000 | | | | | $ | 1,322,500 | | | | | $ | 1,392,500 | | |
Senior secured notes
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 745,000 | | | | | | 745,000 | | |
Capital leases and other indebtedness
|
| | | | 44,378 | | | | | | 42,198 | | | | | | 36,038 | | | | | | 23,321 | | | | | | — | | | | | | 1,221 | | | | | | 147,156 | | |
Interest payments(1)
|
| | | | 111,037 | | | | | | 115,336 | | | | | | 114,460 | | | | | | 112,000 | | | | | | 109,907 | | | | | | 213,277 | | | | | | 776,017 | | |
Total | | | | $ | 169,415 | | | | | $ | 171,534 | | | | | $ | 164,498 | | | | | $ | 149,321 | | | | | $ | 123,907 | | | | | $ | 2,281,998 | | | | | $ | 3,060,673 | | |
|
| | | | TRAVELPORT WORLDWIDE LIMITED | |
| Date: November 1, 2018 | | |
By:
/s/ Bernard Bot
Bernard Bot
Executive Vice President and Chief Financial Officer |
|
| Date: November 1, 2018 | | |
By:
/s/ Antonios Basoukeas
Antonios Basoukeas
Chief Accounting Officer |
|
|
Exhibit
No. |
| |
Description
|
|
| 3.1 | | | | |
| 3.2 | | | | |
| 31.1 | | | | |
| 31.2 | | | | |
| 32 | | | | |
| 101.INS | | | XBRL Instance Document | |
| 101.SCH | | | XBRL Taxonomy Extension Schema Document | |
| 101.CAL | | | XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.LAB | | | XBRL Taxonomy Extension Labels Linkbase Document | |
| 101.PRE | | | XBRL Taxonomy Extension Presentation Linkbase Document | |
| 101.DEF | | | XBRL Taxonomy Extension Definition Linkbase Document | |
| /s/ Gordon Wilson | |
| Chief Executive Officer | |
| /s/ Bernard Bot | |
| Executive Vice President and Chief Financial Officer |
|
| November 1, 2018 | | |
/s/ Gordon Wilson
Gordon Wilson
Chief Executive Officer |
|
| November 1, 2018 | | |
/s/ Bernard Bot
Bernard Bot
Executive Vice President and Chief Financial Officer |
|
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Oct. 30, 2018 |
|
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Travelport Worldwide LTD | |
Entity Central Index Key | 0001424755 | |
Trading Symbol | tvpt | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 126,432,714 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 5,870 | $ 4,681 | $ 72,106 | $ 94,910 |
Other comprehensive income (loss), net of tax | ||||
Currency translation adjustment, net of tax | (1,937) | 4,234 | (8,522) | 20,533 |
Amortization of actuarial loss to net income, net of tax | 2,524 | 2,856 | 7,577 | 8,060 |
Other comprehensive income (loss), net of tax | 587 | 7,090 | (945) | 28,593 |
Comprehensive income | 6,457 | 11,771 | 71,161 | 123,503 |
Comprehensive (income) loss attributable to non-controlling interest in subsidiaries | (762) | 169 | (2,025) | 973 |
Comprehensive income attributable to the Company | $ 5,695 | $ 11,940 | $ 69,136 | $ 124,476 |
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowances for doubtful accounts receivable (in dollars) | $ 9,753 | $ 10,245 |
Preference shares, par value (in dollars per share) | $ 0.0025 | $ 0.0025 |
Preference shares, share authorized | 225,000,000 | 225,000,000 |
Preference shares, shares issued | 0 | 0 |
Preference shares, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0025 | $ 0.0025 |
Common stock, shares authorized | 560,000,000 | 560,000,000 |
Common stock, shares issued | 128,047,376 | 126,967,010 |
Common stock, shares outstanding | 126,306,329 | 125,346,613 |
Treasury stock, shares | 1,741,047 | 1,620,397 |
CONSOLIDATED STATEMENTS OF CHANGES IN TOTAL EQUITY (DEFICIT) (Parenthetical) - $ / shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Statement of Stockholders' Equity [Abstract] | ||
Per share dividend to shareholders | $ 0.225 | $ 0.225 |
Basis of Presentation |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | 1. Basis of Presentation Travelport Worldwide Limited (the “Company” or “Travelport”) is a travel commerce platform providing distribution, technology, payment, mobile and other solutions for the global travel and tourism industry. With a presence in approximately 180 countries and territories, the Travelport business is comprised of: The Travel Commerce Platform, through which the Company facilitates travel commerce by connecting the world’s leading travel providers, such as airlines, hotel chains and car rental companies, with online and offline travel buyers in the Company’s proprietary business-to-business (“B2B”) travel platform. As customer needs and technologies evolve, Travelport continues to invest in its Travel Commerce Platform. Travelport has led innovation in electronic distribution and merchandising of airline core and ancillary products and extensively divested its offerings to hotel, car rental, rail, cruise-line and tour operators. In addition, Travelport has leveraged its domain expertise in the travel industry to design a pioneering B2B payment solution that addresses the need of travel agencies to efficiently and securely make payments to travel providers globally. The Company also has a strong focus on mobile commerce, providing a wide range of services that allows airlines, hotels, corporate travel management companies and travel agencies to engage with their customers through digital services, including apps, corporate booking tools and mobile messaging. Travelport utilizes the extensive data managed by its platform to provide an array of additional services, such as advertising solutions, subscription services, business intelligence data services, and marketing-oriented analytical tools to travel agencies, travel providers and other travel data users. Through its Technology Services, Travelport provides critical hosting services to airlines, such as shopping, ticketing, departure control, business intelligence and other solutions, enabling them to focus on their core business competencies and reduce costs. The Company hosts reservations, inventory management and other related critical systems for Delta Air Lines Inc. The Company has two operating segments, Travelport and eNett; however, the Company reports them together as one reportable segment as eNett does not meet the criteria for a separate reportable segment. These consolidated condensed financial statements and other consolidated condensed financial information included in this Quarterly Report on Form 10-Q are unaudited, with the exception of the December 31, 2017 consolidated condensed balance sheet, which was derived from audited consolidated financial statements. These consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim reporting. Certain disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. In presenting the consolidated condensed financial statements in accordance with U.S. GAAP, management makes estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgments and available information. Accordingly, actual results could differ from those estimates. In management’s opinion, the consolidated condensed financial statements contain all normal recurring adjustments necessary for a fair presentation of interim results reported. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These consolidated condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on February 20, 2018. The Company has reclassified certain prior period information as a result of the Company's adoption of the new guidance on pensions as further described in Note 2–Recently Issued Accounting Pronouncements.
|
Recently Issued Accounting Pronouncements |
9 Months Ended |
---|---|
Sep. 30, 2018 | |
Basis of Presentation [Abstract] | |
Recently Issued Accounting Pronouncements | 2. Recently Issued Accounting Pronouncements Accounting Pronouncements Adopted Equity-Based Compensation—Modification Accounting In May 2017, the Financial Accounting Standards Board (the “FASB”) issued guidance clarifying when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This guidance does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the value, vesting conditions or award classification and will not be required if the changes are considered non-substantive. The Company adopted the provisions of this guidance prospectively effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Pension In March 2017, the FASB issued guidance on the presentation of net periodic pension cost and post-retirement benefit cost (“net benefit cost”). The new guidance requires the service cost component of net benefit cost to be presented as part of the other employee compensation costs in operating income, which can be further considered for capitalization as part of the capitalization policy, and to present the other components of net benefit cost, including interest costs, expected return on plan assets and amortization of actuarial gain or loss (the “other components”) separately, in one or more line items, outside of operating income. Further, the new guidance requires the disclosure of the line items that contain the other components of net benefit cost in the footnotes to the financial statements if they are not presented on appropriately described separate lines in the statement of operations. The Company adopted the provisions of this guidance effective January 1, 2018, as required under the guidance, and for the three and nine months ended September 30, 2017, the Company reclassified $1 million and $3 million, respectively, related to the other components from selling, general and administrative expense to other expense within the consolidated condensed statements of operations. The adoption of this guidance did not have an impact on the Company’s net income, consolidated condensed balance sheets or statements of cash flows. Goodwill Impairment In January 2017, the FASB issued guidance to simplify the accounting for goodwill impairment. The guidance removes step two of the goodwill impairment test, which requires a hypothetical purchase price allocation. Under this guidance, a goodwill impairment is the amount by which a reporting unit’s carrying value exceeds its fair value. The new guidance is applicable for interim and annual reporting periods beginning after December 15, 2019. Early adoption of the amendments in the guidance is permitted for any impairment tests performed after January 1, 2017 and requires its application using a prospective transition method. The Company early adopted the provisions of this guidance effective January 1, 2018. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Restricted Cash In November 2016, the FASB issued guidance that requires entities to include restricted cash as part of cash and cash equivalents in the statement of cash flows. The guidance also requires a reconciliation of cash, cash equivalents and restricted cash balances disclosed in the balance sheet with the corresponding amounts as shown in the statement of cash flows. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. Upon adoption, this guidance did not have an impact on the Company’s consolidated condensed financial statements, however, as of September 30, 2018 the Company had $3 million of restricted cash that is included with cash and cash equivalents in its consolidated condensed statements of cash flows (see Note 8 – Other Non-Current Assets). Statement of Cash Flows In August 2016, the FASB issued guidance on the classification of certain cash receipts and cash payments in the statement of cash flows. The amendments provide specific guidance relating to the classification of certain items, including cash payments for debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, distributions received from equity method investments and cash flows classification based on its predominate source or use. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Financial Instruments In January 2016, the FASB issued guidance that amends the current guidance on the classification and measurement of financial instruments. The guidance significantly revises the accounting related to (i) the classification and measurement of investments in equity securities of unconsolidated subsidiaries (other than those accounted for using the equity method of accounting) and (ii) the presentation of certain fair value changes for financial liabilities measured at fair value. The guidance also amends certain disclosure requirements associated with the fair value of financial instruments. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Revenue Recognition In May 2014, the FASB issued guidance on revenue from contracts with customers that superseded most current revenue recognition guidance, including industry-specific guidance. The underlying principle of the guidance is to recognize revenue to depict the transfer of goods or services to customers at an amount to which a company expects to be entitled in exchange for those goods or services. The new guidance requires an evaluation of revenue arrangements with customers following a five-step approach: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) the company satisfies each performance obligation. Revenue is recognized when control of the promised services is transferred to the customers in an amount that reflects the expected consideration in exchange for those services. A customer obtains control when it has the ability to direct the use of and obtain the benefits from the services. Other major provisions of the guidance include capitalization of certain contract costs, consideration of the time value of money in the transaction price and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have a material impact on the Company’s consolidated condensed financial statements (see Note 3 – Revenue). Accounting Pronouncements Not Yet Adopted Intangibles—Implementation Costs Incurred in a Cloud Computing Arrangement In August 2018, the FASB issued new guidance on a customer's accounting for implementation, set-up and other upfront costs incurred in a cloud computing arrangement that is hosted by a vendor, which is a service contract. Under the new guidance, customers will apply the same criteria for capitalizing implementation costs as they would for an arrangement that has a software license. The new guidance also prescribes the balance sheet, income statement and cash flow classification of the capitalized implementation costs and related amortization expense and requires additional quantitative and qualitative disclosures. This guidance is effective for the Company for the interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted, including adoption in any interim period for which financial statements have not been issued. The Company can choose to adopt the new guidance (1) prospectively to eligible costs incurred on or after the date this guidance is first applied or (2) retrospectively. The Company is currently evaluating the impact of this guidance on its consolidated condensed financial statements. Defined Benefit Plans In August 2018, the FASB issued new guidance that amends certain of the existing guidance to add, remove and clarify disclosure requirements related to defined benefit pension and other post-retirement plans. The guidance requires a company to additionally disclose reasons for significant gains and losses affecting the benefit obligation for the period. The guidance no longer requires certain disclosures, including disclosures on the amounts in accumulated other comprehensive income expected to be recognized as components of net periodic benefit cost over the next fiscal year and the effects of a one-percentage-point change in assumed health care cost trend rates on the (a) aggregate of the service and interest cost components of net periodic benefit costs and (b) benefit obligation for post-retirement health care benefits. This guidance is effective for the Company for the annual reporting periods ending after December 15, 2020 and has to be applied on a retrospective basis to all periods presented. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its consolidated condensed financial statements. Fair Value Measurements In August 2018, the FASB issued new guidance that amends certain of the existing guidance to add, remove and modify disclosure requirements related to fair value measurements. The guidance requires additional disclosures, including the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The guidance no longer requires certain disclosures, including the policy for timing of transfers between levels of the fair value hierarchy and valuation processes for Level 3 fair value measurements. This guidance is effective for the Company for the reporting periods beginning after December 15, 2019, including interim periods therein. Early adoption is permitted for any eliminated or modified disclosures upon issuance of this guidance. The Company is currently evaluating the impact of this guidance on its consolidated condensed financial statements. Financial Instruments—Credit Losses In June 2016, the FASB issued guidance that amends the accounting for credit losses on financial instruments. The guidance adds an impairment model that is based on expected losses rather than incurred losses. Under this new guidance, allowance for credit losses will be recognized based on the estimate of expected credit losses, which will result in more timely recognition of such losses. The guidance requires all available relevant information to be considered when estimating expected credit losses, including details about past events, current conditions and reasonable and supportable forecasts and their implications for expected credit losses. The new guidance is applicable to the Company for interim and annual reporting periods beginning after December 15, 2019 and requires its application using a retrospective transition method. The Company is currently evaluating the impact of the amended guidance on its consolidated condensed financial statements. Leases In February 2016, the FASB issued guidance on lease accounting that supersedes the current guidance on leases. The new guidance establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with the classification affecting the pattern of expense recognition in the statement of operations. The guidance requires adoption using a modified retrospective approach at the beginning of the earliest comparative period presented in the financial statements. In July 2018, the FASB issued further guidance to provide another option for transition under which, the comparative periods presented in the financial statements in the year of adoption will not need to be restated. Under this transition method, a company can apply the transition provisions on January 1, 2019 (i.e. the effective date). The Company expects to adopt the new lease guidance by applying the transition provisions on January 1, 2019 and will recognize the cumulative effect of the transition adjustment as of the effective date. The Company does not expect to provide new lease disclosures for the periods prior to the effective date. The Company is currently evaluating the impact of the guidance on its consolidated condensed financial statements and related disclosures, controls and processes, including evaluating the use of certain optional practical expedients. Further, the Company has selected a lease accounting system to assist with the accounting and disclosure requirements under the new guidance and is in the process of its implementation. The Company is reviewing and analyzing its inventory of existing operating leases. The Company expects a majority of its existing operating leases, with minimum lease commitments as of September 30, 2018 of $94 million, will be subject to the new guidance. Upon adoption of the guidance, the Company will recognize operating lease ROU assets and operating lease liabilities on its consolidated condensed balance sheets that will increase its total assets and liabilities. Although the new guidance is not expected to materially impact the Company’s consolidated condensed statements of operations or its consolidated condensed statements of cash flows, the guidance requires enhanced disclosures related to the nature, amount, timing and uncertainty of cash flows arising from operating and finance leases contracts.
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Revenue |
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Revenue | 3. Revenue On January 1, 2018, the Company adopted the new revenue recognition guidance applying the modified retrospective method to all contracts. Results for reporting periods beginning after January 1, 2018 are presented under the new revenue recognition guidance, while prior period amounts are not adjusted and continue to be reported in accordance with the historic accounting under previous revenue recognition guidance. The Company recorded a $1 million reduction to its accumulated deficit balance as of January 1, 2018, representing the cumulative impact of adopting the new revenue recognition guidance, which primarily relates to the timing of recognition of hotel reservations in the Company’s Beyond Air revenue. For the three and nine months ended September 30, 2018, there was an immaterial impact to net revenue as a result of applying the new revenue recognition guidance.
The Company operates a travel commerce platform providing distribution, technology, payment, mobile and other solutions for the global travel and tourism industry. Through its Travel Commerce Platform, the Company connects travel providers (“customers”), such as airlines, hotel chains and car rental companies, with online and offline travel buyers, including travel agencies, travel management companies and corporations. The Company also provides critical information technology services to airlines, such as shopping, ticketing, departure control, business intelligence and other solutions. The following table presents the Company’s net revenue disaggregated by its source. Sales and usage-based taxes are excluded from net revenue.
Travel Commerce Platform Revenue Travel Commerce Platform revenue primarily utilizes a transaction volume model to recognize revenue. The Company charges a fee per segment booked. The Company also receives a fee for cancellations of bookings previously made on the Company’s platform and a fee for tickets issued by the Company that were originally booked on an alternative system. Revenue for air bookings is recognized at the time of reservation, net of estimated cancellations and anticipated incentives payable to customers. Cancellations prior to the date of departure are estimated based on the historical level of cancellations (net of cancellation fees). The Company’s Beyond Air portfolio includes hospitality, payment solutions, digital services, advertising and other platform services. Revenue for hotel reservations is recognized upon check-in, and revenue for car reservations is recognized upon pick-up, as such reservations can generally be cancelled without penalty. The Company’s payment solutions revenue is earned primarily as a percentage of total transaction value in the form of a share of interchange fees. Revenue is recognized at the point in time when the payment is processed. The Company collects annual fees from travel agencies, internet sites and other subscribers to access the applications on its Travel Commerce Platform, including providing the ability to access schedule and fare information, book reservations and issue tickets. Where the contractual terms are on a subscription basis with fixed amounts of fees, revenue is recognized ratably over the contract period as the performance obligation is satisfied over time. Where the contractual terms are transaction-based with fees charged per transaction, revenue is recognized as the services are provided. The table below sets forth Travel Commerce Platform revenue disaggregated by region:
Technology Services Revenue The Company collects fees, generally on a monthly basis under long-term contracts, for providing hosting solutions and other services to airlines, such as shopping, ticketing, departure control, business intelligence and other solutions. Where the contractual terms are on a subscription basis with fixed amounts of fees, revenue is recognized ratably over the contract period as the performance obligation is satisfied over time. Where the contractual terms are transaction-based with fees charged per transaction, revenue is recognized as the services are provided. Contract Balances Contract assets represent the Company’s right to consideration in exchange for services transferred to a customer when that right is conditioned on the Company’s future performance obligations. Contract liabilities represent the Company’s obligation to transfer services to a customer for which the Company has received consideration (or the amount is due) from the customer. As of September 30, 2018, the Company did not have contract assets. The opening and closing balances of the Company’s accounts receivables and contract liabilities (current and non-current) are as follows:
Substantially all of the Company’s Air revenue within its Travel Commerce Platform is collected through the International Air Transport Association (“IATA”), the Airline Clearing House (“ACH”) and other similar clearing houses, whereby the payments are submitted monthly to the IATA or the ACH and are settled (on a net basis) within approximately 30 days. Airlines that do not settle payments through them and customers in Beyond Air and Technology Services are generally invoiced on a monthly basis, and the payments are generally received within approximately 30 - 60 days. Deferred revenue is recorded when a performance obligation has not been satisfied but an invoice has been raised. The cash payments received or due in advance of the satisfaction of the Company’s performance obligations were offset by $15 million of net revenue recognized that was included in the deferred revenue balance as of January 1, 2018. Remaining Performance Obligations As of September 30, 2018, the aggregate amount of the transaction price allocated to the Company’s remaining performance obligations was approximately $54 million, of which the Company expects to recognize revenue of approximately 80% over the next 24 months, including approximately 50% over the next 12 months. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected term of one year or less and (ii) contracts for which the Company recognizes revenue at the amounts to which it has the right to invoice for services performed.
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Income Taxes |
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Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 4. Income Taxes The Company’s tax provision differs significantly from the expected provision amount calculated at the U.S. federal statutory rate primarily as a result of (i) being subject to income tax in numerous non-U.S. jurisdictions with varying income tax rates, (ii) a valuation allowance maintained in various jurisdictions, including the U.S. and the U.K., due to historical losses in such jurisdictions, (iii) certain expenses that are not deductible for tax or do not secure an effective tax deduction under the relevant jurisdictions, (iv) certain income or gains that are not subject to tax, (v) items identified as discrete during the interim periods, (vi) the impact of the U.S. Tax Reforms (as defined below) and (vii) the impact of changes in the U.K. to the tax deductibility of interest. As of December 31, 2017, the Company had U.S. federal net operating losses (“NOL”) carry forwards of approximately $400 million, which expire between 2032 and 2037, state NOL carry forwards, which expire between 2018 and 2037, and alternative minimum tax (“AMT”) and other tax credits carry forward of approximately $27 million. The Company had other non–U.S. NOL carry forwards of $345 million that expire between three years and indefinitely. As of December 31, 2017, the deferred tax asset in respect of these U.S. and non–U.S. NOL carry forwards and U.S. tax credits was $197 million. The Company believes it is more likely than not that the benefit from certain U.S. federal, U.S. state and non–U.S. NOL carry forwards and other deferred tax assets will not be realized. Consequently, the Company has recorded valuation allowances of $187 million against such deferred tax assets as of December 31, 2017. The Company regularly assesses its ability to realize deferred tax assets. As of September 30, 2018, the Company’s estimated annual effective tax rate includes the impact of (i) releasing a portion of the valuation allowance associated with the U.S. NOL carry forwards due to an increase in taxable temporary differences that support deferred tax asset utilization and (ii) releasing a portion of the valuation allowance associated with the U.K. NOL carry forwards (see below). However, the Company maintains a valuation allowance on the remaining deferred tax assets. Future realized earnings performance and changes in future earnings projections, among other factors, may cause an adjustment to the conclusion as to whether it is more likely than not that the Company will realize the benefit of the deferred tax assets. This would impact the income tax expense in the period for which it is determined that these factors have changed. As a result of the Company’s debt restructuring in March 2018 (see Note 11–Long-Term Debt), the Company expects that there will be future taxable income in the U.K. other than the reversal of deferred tax liabilities. Consequently, the Company realized a benefit of $10 million in the first quarter of 2018 following the release of the valuation allowance on the deferred tax assets associated with its U.K. NOL carry forwards. The Company’s preliminary estimate of the impact of the comprehensive changes to the U.S. tax legislation that were enacted in December 2017 under the Tax Cuts and Jobs Act (the “U.S. Tax Reforms”) is subject to the finalization of management’s analysis related to certain matters, such as developing interpretations of the provisions of the U.S. Tax Reforms, administrative interpretations or court decisions interpreting the U.S. Tax Reforms that may require further adjustments and changes in the Company’s estimates that could be beneficial or adverse. The Company continued to assess the impact of the U.S. Tax Reforms during the nine months ended September 30, 2018. The assessment will be completed by December 2018 (being the one–year measurement period from the date of enactment of the U.S. Tax Reforms), however, the Company currently does not expect a material impact to its consolidated financial statements. Given the anticipated further guidance from the U.S. Treasury about implementing the U.S. Tax Reforms and the potential for additional guidance from the SEC or the FASB related to it or additional information becoming available, the Company’s expectation of the impact may change.
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Other Current Assets |
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Other Current Assets | 5. Other Current Assets Other current assets consisted of:
Client funds represent cash held on behalf of clients for a short period of time before being transferred to travel industry partners. A compensating balance is held in accrued expenses and other current liabilities as customer prepayments.
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Property and Equipment, Net | 6. Property and Equipment, Net Property and equipment, net, consisted of:
The Company recorded depreciation expense (including depreciation on assets under capital leases) of $40 million for both the three months ended September 30, 2018 and 2017. The Company recorded depreciation expense (including depreciation on assets under capital leases) of $118 million and $126 million during the nine months ended September 30, 2018 and 2017, respectively. As of September 30, 2018 and December 31, 2017, the Company had capital lease assets of $216 million and $208 million, respectively, with accumulated depreciation of $72 million and $107 million, respectively, included within computer equipment. During the nine months ended September 30, 2018, the Company entered into new capital lease arrangements related to its information technology assets resulting in additions of $72 million of capital lease assets.
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Intangible Assets |
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Intangible Assets | 7. Intangible Assets The changes in the carrying amount of goodwill and intangible assets of the Company between January 1, 2018 and September 30, 2018 are as follows:
The changes in the carrying amount of goodwill and intangible assets of the Company between January 1, 2017 and September 30, 2017 are as follows:
The Company paid cash of $73 million and $55 million for customer loyalty payments during the nine months ended September 30, 2018 and 2017, respectively. Further, as of September 30, 2018 and December 31, 2017, the Company had balances payable of $61 million and $77 million, respectively, for customer loyalty payments. Amortization expense for acquired intangible assets was $10 million for each of the three months ended September 30, 2018 and 2017. For the nine months ended September 30, 2018 and 2017, amortization expense for acquired intangible assets was $30 million and $31 million, respectively, and is included as a component of depreciation and amortization in the Company’s consolidated condensed statements of operations. Amortization expense for customer loyalty payments was $20 million for each of the three months ended September 30, 2018 and 2017 and $65 million and $57 million for the nine months ended September 30, 2018 and 2017, respectively, and is included within cost of revenue or net revenue in the Company’s consolidated condensed statements of operations. Included within retirements of customer loyalty payments is $3 million and $14 million of impairment recognized during the three and nine months ended September 30, 2018, respectively.
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Other Non-Current Assets |
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Other Non-Current Assets | 8. Other Non-Current Assets Other non-current assets consisted of:
The restricted cash of $3 million and $0 as of September 30, 2018 and December 31, 2017, respectively, relates to cash provided as collateral for an operational bank facility. Cash and cash equivalents balance of $200 million and $122 million as of September 30, 2018 and December 31, 2017, respectively, and restricted cash balance of $3 million and $0 as of September 30, 2018 and December 31, 2017, respectively, are considered together to determine the movements in and balances of cash, cash equivalents and restricted cash in the Company’s consolidated condensed statements of cash flows.
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Restructuring Charges |
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Sep. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | 9. Restructuring Charges In the third quarter of 2018, the Company initiated plans to enhance the Company’s operational efficiency in response to changes in market conditions and the industry in which the Company operates. As a result, the Company expects to implement changes to its operating and management structure to streamline and simplify the organization. It is expected that the implementation of these plans will result in savings within its corporate and operational functions. As of September 30, 2018, the Company has recorded a severance charge of $15 million which is included within selling, general and administrative expense on the Company’s consolidated condensed statements of operations and within accrued expenses and other current liabilities on the Company’s consolidated condensed balance sheets as it is probable that the liability has been incurred and the amount can be reasonably estimated for anticipated severances in accordance with the Company’s severance policies for ongoing benefit arrangements. In November 2016, the Company committed to undertake a course of action to enhance and optimize the Company’s operational and technological efficiency. This program was substantially completed as of December 31, 2017. Total restructuring charges recognized of $2 million and $8 million for the three and nine months ended September 30, 2017, respectively, are included within selling, general and administrative expenses in the Company’s consolidated condensed statements of operations.
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Accrued Expenses and Other Current Liabilities |
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Accrued Expenses and Other Current Liabilities | 10. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of:
Included in accrued commissions and incentives are $61 million and $77 million of accrued customer loyalty payments as of September 30, 2018 and December 31, 2017, respectively.
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Long-Term Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | 11. Long-Term Debt Long-term debt consisted of:
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Senior Secured Credit Agreement In March 2018, Travelport Finance (Luxembourg) S.à r.l. (the “Borrower”), a wholly-owned subsidiary of the Company, entered into a new senior secured credit agreement (the “2018 Credit Agreement”). Under the 2018 Credit Agreement, the lenders agreed to extend credit to the Borrower in the form of (a) initial secured term loans in an aggregate principal amount of $1,400 million maturing in March 2025, issued at a discount of 0.50%, which amortizes in quarterly installments, commencing August 31, 2018, equal to 0.25% of the original principal amount of the term loans (which payments can be reduced as a result of prepayments in accordance with the 2018 Credit Agreement), with the balance payable at maturity and (b) a revolving credit facility in an aggregate principal amount of $150 million maturing in September 2022. The Company used the proceeds from these term loans, together with the proceeds from the issuance of senior secured notes (discussed below) and cash on the balance sheet, to repay the outstanding balance remaining of the term loans under the previous senior secured credit agreement (the “2014 Credit Agreement”) and to pay the related transaction expenses and fees. Upon the repayment in full of the obligations, the 2014 Credit Agreement was terminated. The Company recorded the debt refinancing transaction as the issuance of new debt and extinguishment of prior debt and recognized a loss on early extinguishment of debt of $28 million in its consolidated condensed statements of operations for the nine months ended September 30, 2018. Under the 2018 Credit Agreement, the interest rate per annum applicable to (a) the term loans is based on, at the election of the Borrower, LIBOR plus 2.50% or base rate (as defined in the 2018 Credit Agreement) plus 1.50% and (b) the borrowings under revolving credit facility, at the election of the Borrower, LIBOR plus 2.25% or base rate (as defined in the 2018 Credit Agreement) plus 1.25%. LIBOR rates and base rates have a floor of 0.00%. The Company expects to pay interest based on LIBOR. Further, during the nine months ended September 30, 2018, the Company (i) repaid $8 million principal amount of term loans outstanding under the 2018 Credit Agreement, including a $4 million voluntary prepayment, (ii) repaid $6 million principal amount of term loans outstanding under the 2014 Credit Agreement, (iii) amortized $2 million of debt finance costs and $1 million of debt discount, (iv) repaid $28 million under its capital lease obligations and entered into new capital leases arrangements for information technology assets resulting in a $72 million increase in capital lease obligations and (v) repaid $3 million under its other indebtedness obligations. The Company is not contractually required to repay quarterly installments of the term loans until the first quarter of 2019. However, the Company has classified a portion of its term loans (along with the contractual quarterly installments) as current portion of long-term debt as the Company intends and is able to make additional voluntary prepayments of the term loans from cash flow from operations, which the Company expects to occur within the next twelve months. The amount of any such prepayments may vary based on the Company’s actual cash flow generation and needs, as well as general economic conditions. As discussed above, in March 2018, the Borrower entered into a new revolving credit facility under the 2018 Credit Agreement with a consortium of banks. The lenders, terms, credit facility amount and maturity date under the new revolving credit facility are substantially the same as under the 2014 Credit Agreement, except for the reduction in interest rates discussed above. Under the new terms, the Borrower has a $150 million revolving credit facility, which contains a letter of credit sub-limit up to a maximum of $100 million. As of September 30, 2018, there were no outstanding borrowings under the revolving credit facility under the 2018 Credit Agreement, and $5 million was utilized for the issuance of letters of credit, with a balance of $145 million remaining. Senior Secured Notes In March 2018, Travelport Corporate Finance PLC (the “Issuer”), a wholly-owned subsidiary of the Company, issued a principal amount of $745 million in senior secured notes due in March 2026 with a stated interest rate of 6.00% per annum. The proceeds were used to repay a portion of the term loans outstanding under the 2014 Credit Agreement. The interest on the senior secured notes is payable semi-annually in cash in arrears on March 15 and September 15 of each year, commencing September 15, 2018. Debt Maturities Aggregate maturities of debt as of September 30, 2018 are as follows:
Debt Finance Costs The Company had unamortized debt finance costs of (i) $7 million and $13 million as of September 30, 2018 and December 31, 2017, respectively, in relation to its term loans under the 2018 Credit Agreement and the 2014 Credit Agreement, respectively, which are presented as a deduction from the principal amount of the term loans, (ii) $7 million as of September 30, 2018 in relation to its senior secured notes, which are presented as a deduction from the principal amount of senior secured notes, and (iii) $2 million as of both September 30, 2018 and December 31, 2017 in relation to its revolving credit facility, which are capitalized within other non-current assets on the consolidated condensed balance sheets. The debt finance costs are amortized over the term of the related debt as part of interest expense in the consolidated condensed statements of operations. The movements in total unamortized debt finance costs for the nine months ended September 30, 2018 and 2017 are summarized below:
Debt Covenants and Guarantees The 2018 Credit Agreement and the Indenture governing the senior secured notes contain financial and other covenants, including: limitations on the ability of Travelport Limited, a wholly-owned subsidiary of the Company and the Borrower’s and the Issuer’s immediate parent entity (the “Parent Guarantor”) and its restricted subsidiaries to incur debt or liens or make certain investments and acquisitions and restricted payments, limitations on transactions with affiliates and certain restrictions on the sale of assets. A violation of these covenants could result in the Parent Guarantor and its restricted subsidiaries being prohibited from making certain restricted payments, including dividends, or cause a default under the 2018 Credit Agreement or the Indenture, which would permit the participating lenders to restrict the Parent Guarantor’s and its restricted subsidiaries’ ability to access the revolving credit facility and require the immediate repayment of any outstanding advances made under the 2018 Credit Agreement or the Indenture. Solely in the case of the revolving credit facility under the 2018 Credit Agreement, if the amount outstanding under the revolving credit facility exceeds a certain threshold, there is a requirement to maintain a first lien leverage ratio. The senior secured notes are guaranteed fully and unconditionally on a senior secured basis by the Parent Guarantor and certain of its existing and future wholly-owned subsidiaries that also guarantee the facilities under the 2018 Credit Agreement. The senior secured notes and related guarantees are secured on a first-priority basis by security interests in all of the Issuer’s and the guarantors’ assets that also secure the facilities under the 2018 Credit Agreement on a first-priority basis. As of September 30, 2018, the Company was in full compliance with all restrictive and financial covenants related to its debt.
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Financial Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | 12. Financial Instruments The Company uses derivative financial instruments as part of its overall strategy to manage its exposure to market risks primarily associated with fluctuations in foreign currency exchange rates and interest rates. The Company does not use derivatives for trading or speculative purposes. During the nine months ended September 30, 2018, there were no material changes in the Company’s foreign currency and interest rate risk management policies or in its fair value methodology. As of September 30, 2018, the Company had a net asset position of $6 million related to its derivative financial instruments. Foreign Currency Risk The Company’s primary foreign currency risk exposure as of September 30, 2018 was due to exchange rate fluctuations that arise from certain intercompany transactions and earnings denominated in non-U.S. dollar currencies and from non-functional currency denominated assets and liabilities. The Company uses foreign currency derivative contracts (forward contracts) to manage its exposure to changes in foreign currency exchange rates, primarily exposure to British pound, Euro and Australian dollar. The Company did not designate these foreign currency derivative contracts as accounting hedges. Fluctuations in the value of these foreign currency derivative contracts were recorded within the Company’s consolidated condensed statements of operations, which partially offset the impact of the changes in the value of the foreign currency denominated receivables and payables and forecasted earnings they were intended to economically hedge. Interest Rate Risk As of September 30, 2018, the Company’s primary interest rate risk exposure was to interest rate fluctuations in the United States, specifically the impact of LIBOR interest rates on the Company’s U.S. dollar denominated variable rate term loans. During the nine months ended September 30, 2018, the average LIBOR rate applied to the term loans was 2.03%. In order to protect against potential higher interest costs resulting from increases in LIBOR, as of September 30, 2018, the Company had outstanding interest rate swap contracts that fix the LIBOR rate payable as follows:
As of September 30, 2018, the net notional amounts of the Company’s derivative contracts are as follows:
As of September 30, 2018, the interest rate swap contracts cover varying periods as disclosed above, and the foreign currency contracts cover the twelve month period until September 2019. Presented below is a summary of the gross fair value of the Company’s derivative contracts, which have not been designated as hedging instruments, recorded on the consolidated condensed balance sheets:
The following table provides a reconciliation of the movement in the net carrying amount of derivative financial instruments during the nine months ended September 30, 2018 and 2017:
The table below presents the impact of the changes in fair values of derivatives not designated as hedges on net income during the three and nine months ended September 30, 2018 and 2017:
Fair Value Disclosures for All Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, other current assets, accounts payable and accrued expenses and other current liabilities approximate fair value due to the short-term maturities of these assets and liabilities. The fair values of the Company’s other financial instruments are as follows:
The significant unobservable inputs used to fair value the Company’s derivative financial instruments are based on market quoted probability rates of default for each of the derivative assets and liabilities, resulting in a weighted average probability of default of 5% and a recovery rate of 75% for derivative assets and 65% for derivative liabilities. As the credit valuation adjustment applied to arrive at the fair value of derivatives is less than 15% of the unadjusted fair value of derivative instruments for two consecutive quarters, the Company has categorized derivative fair valuations at Level 2 of the fair value hierarchy. A 10% change in the significant unobservable inputs will not have a material impact on the fair value of the derivative financial instruments as of September 30, 2018. The fair value of the Company’s total debt has been determined by calculating the fair value of its term loans and senior secured notes based on quoted prices obtained from independent brokers for identical debt instruments when traded as an asset and is categorized within Level 2 of the fair value hierarchy.
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 13. Commitments and Contingencies Purchase Commitments In the ordinary course of business, the Company makes various commitments to purchase goods and services from specific suppliers, including those related to capital expenditures. As of September 30, 2018, the Company had approximately $85 million of outstanding purchase commitments, primarily relating to service contracts for information technology, of which $48 million relates to the twelve months ending September 30, 2019. These purchase obligations extend through 2022. Contingencies Company Litigation The Company is involved in various claims, legal proceedings and governmental inquiries related to contract disputes, business practices, intellectual property and other commercial, employment and tax matters. The Company believes it has adequately accrued for such matters as appropriate or, for matters not requiring accrual, believes they will not have a material adverse effect on its results of operations, financial position or cash flows based on information currently available. However, litigation is inherently unpredictable and although the Company believes its accruals are adequate and/or that it has valid defenses in these matters, unfavorable resolutions could occur, which could have a material effect on the Company’s results of operations or cash flows in a particular reporting period. Standard Guarantees/Indemnification In the ordinary course of business, the Company enters into numerous agreements that contain standard guarantees and indemnities whereby the Company indemnifies another party for breaches of representations and warranties. In addition, many of these parties are also indemnified against any third-party claim resulting from the transaction that is contemplated in the underlying agreement. Such guarantees or indemnifications are granted under various agreements, including those governing (i) purchases, sales or outsourcing of assets or businesses, (ii) leases of real estate, (iii) licensing of trademarks, (iv) use of derivatives and (v) issuances of debt or equity securities. The guarantees or indemnifications issued are for the benefit of the (i) buyers in sale agreements and sellers in purchase agreements, (ii) landlords in lease contracts, (iii) licensees of the Company’s trademarks, (iv) financial institutions in derivative contracts and (v) underwriters in debt or equity security issuances. While some of these guarantees extend only for the duration of the underlying agreement, many survive the expiration of the term of the agreement or extend into perpetuity (unless subject to a legal statute of limitations). There are no specific limitations on the maximum potential amount of future payments the Company could be required to make under these guarantees, nor is the Company able to develop an estimate of the maximum potential amount of future payments to be made under these guarantees, as the triggering events are not subject to predictability and there is little or no history of claims against the Company under such arrangements. With respect to certain of the aforementioned guarantees, such as indemnifications of landlords against third-party claims for the use of real estate property leased by the Company, the Company maintains insurance coverage that mitigates any potential payments to be made.
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Equity |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity | 14. Equity Sale of Shares of a Subsidiary In April 2017, the Company sold its 51% controlling interest in IGT Solutions Private Ltd. (“IGTS”) for a total gross cash consideration of $18 million and recorded a gain on sale of such subsidiary of $1 million, which includes the reclassification of loss on currency translation adjustment from accumulated other comprehensive loss of $4 million. The Company no longer owns any shares in, and/or controls, IGTS following the sale. Dividends on Common Shares The Company’s Board of Directors declared the following cash dividends during the nine months ended September 30, 2018:
On October 31, 2018, the Company’s Board of Directors declared a cash dividend of $0.075 per common share (see Note 18—Subsequent Events).
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Equity-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-Based Compensation | 15. Equity-Based Compensation Restricted Share Units (“RSUs”) During the first quarter of 2018, as part of its annual grant program, the Company granted 596,063 RSUs. These RSUs vest one-fourth annually over a period of four years, if the employee continues to remain in employment during the vesting period. The Company further granted 202,100 RSUs to certain employees that cliff-vest in approximately two years from the grant date upon continued employment of the employee during the vesting period. RSUs accrue dividend equivalents associated with the underlying common shares as dividends are declared by the Company. Dividends will generally be paid to holders of RSUs in cash upon the vesting of the associated RSUs and will be forfeited should the RSUs not vest. The RSUs do not have an exercise price, and the fair value of the RSUs is considered to be the closing market price of the Company’s common shares at the date of grant. Certain of the Company’s outstanding RSUs may be settled by the issuance of common shares held as treasury shares. In line with the Company’s accounting policy, the compensation costs related to RSUs are expensed on a straight-line basis. The table below presents the activity of the Company’s RSUs for the nine months ended September 30, 2018:
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Performance Share Units (“PSUs”) During the first quarter of 2018, as part of its annual grant program, the Company granted 1,246,803 PSUs. The PSUs cliff-vest at the end of approximately three years from the date of the grant based on the satisfaction of certain performance conditions and continued employment of the employee during the vesting period. The ultimate number of PSUs that will vest also depends on the Company’s ranking within a group of companies based on achievement of its total shareholder’s return (“TSR”) during the applicable performance period compared to the TSR of the companies within the selected group. However, the total number of PSUs that will ultimately vest will not exceed 200% of the original grant. Each reporting period, the Company assesses the probability of vesting, and, if there is any change in such probability, the Company records the cumulative effect of the adjustment in the current reporting period. All of the PSUs will be settled in the Company’s common shares. PSUs accrue dividend equivalents associated with the underlying common shares as dividends are declared by the Company. Dividends will generally be paid to holders of PSUs in cash upon the vesting of the associated PSUs and will be forfeited should the PSUs not vest. The PSUs do not have an exercise price. For PSUs earned based on a market condition, the Company utilizes a Monte Carlo simulation to determine the fair value of these awards at the date of grant. Certain of the Company’s outstanding PSUs may be settled by the issuance of common shares held as treasury shares. In line with the Company’s accounting policy, the compensation costs related to the PSUs are expensed on a straight-line basis. The table below presents the activity of the Company’s PSUs for the nine months ended September 30, 2018:
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Stock Options During the nine months ended September 30, 2018, the Company did not grant any stock options. The table below presents the activity of the Company’s stock options for the nine months ended September 30, 2018:
Total equity-based compensation expense recognized in the Company’s consolidated condensed statements of operations for the three months ended September 30, 2018 and 2017 was $0 and $9 million, respectively ($0 million and $8 million after tax for the three months ended September 30, 2018 and 2017, respectively). The total income tax benefit related to equity-based compensation expense was $0 million and $1 million for the three months ended September 30, 2018 and 2017, respectively. Total equity-based compensation expense recognized in the Company’s consolidated condensed statements of operations for the nine months ended September 30, 2018 and 2017 was $12 million and $24 million, respectively ($11 million and $22 million after tax for the nine months ended September 30, 2018 and 2017, respectively). The total income tax benefit related to equity-based compensation expense was $1 million and $2 million for the nine months ended September 30, 2018 and 2017, respectively. The Company expects the future equity-based compensation expense in relation to awards granted and outstanding as of September 30, 2018 will be approximately $29 million.
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Per Share | 16. Income Per Share The following table reconciles the numerators and denominators used in the computation of basic and diluted income per share from continuing operations:
Basic income per share is based on the weighted average number of common shares outstanding during each period. Diluted income per share is based on the weighted average number of common shares outstanding and the effect of all dilutive common share equivalents during each period. For the three and nine months ended September 30, 2018, the Company had nil and 1 million, respectively, of weighted average common share equivalents, primarily associated with the Company’s stock options, that were excluded from the calculation of diluted income per share. For the three and nine months ended September 30, 2017, the Company had 2.3 million and 2.4 million, respectively, of weighted average common share equivalents, primarily associated with the Company’s stock options, that were excluded from the calculation of diluted income per share. These were excluded as their inclusion would have been antidilutive as the common shares repurchased from the total assumed proceeds applying the treasury stock method exceed the common shares that would have been issued.
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Discontinued Operations |
9 Months Ended |
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Sep. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | 17. Discontinued Operations In connection with the sale of the Gullivers Travel Associates business to Kuoni in 2011, the Company agreed to indemnify Kuoni through January 2018 for certain potential liabilities relating to pre-sale events. As no further obligations arose under the indemnity, the Company released the remaining balance of the indemnity provision of $28 million during the first quarter of 2018, which is included within income from discontinued operations, net of tax, in the consolidated condensed statements of operations. This release of the indemnity provision did not have any impact on the consolidated condensed statements of cash flows.
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Subsequent Events |
9 Months Ended |
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Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 18. Subsequent Events On October 31, 2018, the Company’s Board of Directors declared a cash dividend of $0.075 per common share for the third quarter of 2018, which is payable on December 20, 2018 to shareholders of record on December 6, 2018.
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Recently Issued Accounting Pronouncements (Policies) |
9 Months Ended |
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Sep. 30, 2018 | |
Basis of Presentation [Abstract] | |
Recently Issued Accounting Pronouncements | Accounting Pronouncements Adopted Equity-Based Compensation—Modification Accounting In May 2017, the Financial Accounting Standards Board (the “FASB”) issued guidance clarifying when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This guidance does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the value, vesting conditions or award classification and will not be required if the changes are considered non-substantive. The Company adopted the provisions of this guidance prospectively effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Pension In March 2017, the FASB issued guidance on the presentation of net periodic pension cost and post-retirement benefit cost (“net benefit cost”). The new guidance requires the service cost component of net benefit cost to be presented as part of the other employee compensation costs in operating income, which can be further considered for capitalization as part of the capitalization policy, and to present the other components of net benefit cost, including interest costs, expected return on plan assets and amortization of actuarial gain or loss (the “other components”) separately, in one or more line items, outside of operating income. Further, the new guidance requires the disclosure of the line items that contain the other components of net benefit cost in the footnotes to the financial statements if they are not presented on appropriately described separate lines in the statement of operations. The Company adopted the provisions of this guidance effective January 1, 2018, as required under the guidance, and for the three and nine months ended September 30, 2017, the Company reclassified $1 million and $3 million, respectively, related to the other components from selling, general and administrative expense to other expense within the consolidated condensed statements of operations. The adoption of this guidance did not have an impact on the Company’s net income, consolidated condensed balance sheets or statements of cash flows. Goodwill Impairment In January 2017, the FASB issued guidance to simplify the accounting for goodwill impairment. The guidance removes step two of the goodwill impairment test, which requires a hypothetical purchase price allocation. Under this guidance, a goodwill impairment is the amount by which a reporting unit’s carrying value exceeds its fair value. The new guidance is applicable for interim and annual reporting periods beginning after December 15, 2019. Early adoption of the amendments in the guidance is permitted for any impairment tests performed after January 1, 2017 and requires its application using a prospective transition method. The Company early adopted the provisions of this guidance effective January 1, 2018. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Restricted Cash In November 2016, the FASB issued guidance that requires entities to include restricted cash as part of cash and cash equivalents in the statement of cash flows. The guidance also requires a reconciliation of cash, cash equivalents and restricted cash balances disclosed in the balance sheet with the corresponding amounts as shown in the statement of cash flows. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. Upon adoption, this guidance did not have an impact on the Company’s consolidated condensed financial statements, however, as of September 30, 2018 the Company had $3 million of restricted cash that is included with cash and cash equivalents in its consolidated condensed statements of cash flows (see Note 8 – Other Non-Current Assets). Statement of Cash Flows In August 2016, the FASB issued guidance on the classification of certain cash receipts and cash payments in the statement of cash flows. The amendments provide specific guidance relating to the classification of certain items, including cash payments for debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, distributions received from equity method investments and cash flows classification based on its predominate source or use. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Financial Instruments In January 2016, the FASB issued guidance that amends the current guidance on the classification and measurement of financial instruments. The guidance significantly revises the accounting related to (i) the classification and measurement of investments in equity securities of unconsolidated subsidiaries (other than those accounted for using the equity method of accounting) and (ii) the presentation of certain fair value changes for financial liabilities measured at fair value. The guidance also amends certain disclosure requirements associated with the fair value of financial instruments. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements. Revenue Recognition In May 2014, the FASB issued guidance on revenue from contracts with customers that superseded most current revenue recognition guidance, including industry-specific guidance. The underlying principle of the guidance is to recognize revenue to depict the transfer of goods or services to customers at an amount to which a company expects to be entitled in exchange for those goods or services. The new guidance requires an evaluation of revenue arrangements with customers following a five-step approach: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) the company satisfies each performance obligation. Revenue is recognized when control of the promised services is transferred to the customers in an amount that reflects the expected consideration in exchange for those services. A customer obtains control when it has the ability to direct the use of and obtain the benefits from the services. Other major provisions of the guidance include capitalization of certain contract costs, consideration of the time value of money in the transaction price and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have a material impact on the Company’s consolidated condensed financial statements (see Note 3 – Revenue).
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Revenue (Tables) |
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Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The following table presents the Company’s net revenue disaggregated by its source. Sales and usage-based taxes are excluded from net revenue.
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Disaggregation Of Revenue By Region | The table below sets forth Travel Commerce Platform revenue disaggregated by region:
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Contract with Customer Asset and Liability | As of September 30, 2018, the Company did not have contract assets. The opening and closing balances of the Company’s accounts receivables and contract liabilities (current and non-current) are as follows:
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Other Current Assets (Tables) |
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Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Prepaid Expense and Other Assets, Current [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of other current assets | Other current assets consisted of:
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Property and Equipment, Net (Tables) |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of property and equipment, net | Property and equipment, net, consisted of:
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Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in the carrying amount of goodwill and intangible assets | The changes in the carrying amount of goodwill and intangible assets of the Company between January 1, 2018 and September 30, 2018 are as follows:
The changes in the carrying amount of goodwill and intangible assets of the Company between January 1, 2017 and September 30, 2017 are as follows:
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Other Non-Current Assets (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Assets, Noncurrent Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of other non-current assets | Other non-current assets consisted of:
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Accrued Expenses and Other Current Liabilities (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of:
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Long-Term Debt (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of long-term debt | Long-term debt consisted of:
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Schedule of aggregate maturities of debt | Aggregate maturities of debt as of September 30, 2018 are as follows:
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Schedule of movement in deferred finance costs | The movements in total unamortized debt finance costs for the nine months ended September 30, 2018 and 2017 are summarized below:
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Financial Instruments (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Derivatives | In order to protect against potential higher interest costs resulting from increases in LIBOR, as of September 30, 2018, the Company had outstanding interest rate swap contracts that fix the LIBOR rate payable as follows:
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Schedule of Notional Amounts of Outstanding Derivative Positions | As of September 30, 2018, the net notional amounts of the Company’s derivative contracts are as follows:
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Schedule of gross fair value of derivative contracts | Presented below is a summary of the gross fair value of the Company’s derivative contracts, which have not been designated as hedging instruments, recorded on the consolidated condensed balance sheets:
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Schedule of reconciliation of the movement in the net carrying amount of derivative financial instruments | The following table provides a reconciliation of the movement in the net carrying amount of derivative financial instruments during the nine months ended September 30, 2018 and 2017:
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Schedule of impact of changes in fair values of derivatives | The table below presents the impact of the changes in fair values of derivatives not designated as hedges on net income during the three and nine months ended September 30, 2018 and 2017:
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Schedule of fair values of other financial instruments | The fair values of the Company’s other financial instruments are as follows:
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Equity (Tables) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of cash dividends declared | The Company’s Board of Directors declared the following cash dividends during the nine months ended September 30, 2018:
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Equity-Based Compensation (Tables) |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule for activity of restricted stock units | The table below presents the activity of the Company’s RSUs for the nine months ended September 30, 2018:
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Schedule for activity of performance based stock units | The table below presents the activity of the Company’s PSUs for the nine months ended September 30, 2018:
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Schedule for activity of stock options | The table below presents the activity of the Company’s stock options for the nine months ended September 30, 2018:
|
Income Per Share (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of numerators and denominators used in the computation of basic and diluted income (loss) per share | The following table reconciles the numerators and denominators used in the computation of basic and diluted income per share from continuing operations:
|
Recently Issued Accounting Pronouncements (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |
---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
|
Basis of Presentation [Abstract] | |||
Reclassification From Prior Year Related To Adopted Guidance For Other Components From Selling General And Administrative Expense | $ 1 | $ 3 | |
Operating Leases, Future Minimum Payments Due | $ 94 | ||
Restricted Cash | $ 3 |
Revenue (Narrative) (Details) $ in Millions |
Jan. 01, 2018
USD ($)
|
---|---|
Revenue [Abstract] | |
Recorded reduction to accumulated deficit related to revenue recognition | $ 1 |
Revenue (Revenue Disaggregated by Revenue Source) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Revenue [Abstract] | ||||
Travel Commerce Platform, Air, Revenue | $ 404,643 | $ 1,321,525 | ||
Travel Commerce Platform, Beyond Air, Revenue | 192,968 | 566,740 | ||
Travel Commerce Platform, Revenue | 597,611 | 1,888,265 | ||
Technology Services Revenue | 24,974 | 74,166 | ||
Revenues, Total | 622,585 | $ 610,842 | 1,962,431 | $ 1,873,712 |
Net Revenue, Other Than From Contracts With Customers | $ 15,000 | $ 46,000 |
Revenue (Revenue Disaggregated by Region) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended |
---|---|---|
Sep. 30, 2018 |
Sep. 30, 2018 |
|
Travel Commerce Platform, Revenue | $ 597,611 | $ 1,888,265 |
Net Revenue, Other Than From Contracts With Customers | 15,000 | 46,000 |
International | ||
Travel Commerce Platform, Revenue | 449,512 | 1,423,920 |
Pacific | ||
Travel Commerce Platform, Revenue | 140,186 | 426,728 |
Europe | ||
Travel Commerce Platform, Revenue | 202,300 | 670,082 |
Latin America And Canada | ||
Travel Commerce Platform, Revenue | 28,202 | 87,517 |
Middle East And Africa | ||
Travel Commerce Platform, Revenue | 78,824 | 239,593 |
United States | ||
Travel Commerce Platform, Revenue | $ 148,099 | $ 464,345 |
Revenue (Opening and closing balances of accounts receivables, contract assets and current and long term contract liabilities) (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Dec. 31, 2017 |
|
Revenue [Abstract] | ||
Accounts Receivable | $ 205,067 | $ 174,765 |
Accounts Receivable, Increase (Decrease) | 30,302 | |
Deferred Revenue, Current | 38,406 | 32,010 |
Deferred Revenue Current, Increase (Decrease) | 6,396 | |
Deferred Revenue, Noncurrent | 4,678 | $ 6,056 |
Deferred Revenue Non-Current, Increase (Decrease) | $ (1,378) |
Revenue (Remaining Performance Obligations) (Details) - USD ($) $ in Millions |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Revenue [Abstract] | ||
Net Revenue Recognized Offsetting Performance Obligations | $ 15 | |
Revenue, Remaining Performance Obligation | $ 54 | |
Revenue, Remaining Performance Obligation, Expected Recognized Revenue Next 24 Months | 80.00% | |
Revenue, Remaining Performance Obligation, Expected Recognized Revenue Next 12 Months | 50.00% |
Income Taxes (Narrative) (Details) - USD ($) $ in Millions |
1 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
|
Deferred Tax Assets, Operating Loss Carryforwards | $ 197 | |
Operating Loss Carryforwards, Valuation Allowance | 187 | |
Domestic Tax Authority [Member] | ||
Operating Loss Carryforwards | 400 | |
State and Local Jurisdiction [Member] | ||
State NOL carry forwards, alternative minimum tax, and other tax credits carry forwards | 27 | |
Foreign Tax Authority [Member] | ||
Operating Loss Carryforwards | $ 345 | |
United Kingdom | ||
Realized Benefit Related To Release Of Valuation Allowance On Deferred Tax Assets | $ 10 |
Other Current Assets (Summary of Other Current Assets) (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Prepaid Expense and Other Assets, Current [Abstract] | ||
Sales and use tax receivables | $ 32,656 | $ 30,163 |
Prepaid expenses | 26,689 | 24,271 |
Client funds | 25,643 | 15,774 |
Prepaid incentives | 19,771 | 16,677 |
Derivative assets | 11,995 | 15,233 |
Other | 8,858 | 7,606 |
Other current assets, Total | $ 125,612 | $ 109,724 |
Property and Equipment, Net (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Dec. 31, 2017 |
|
Capital lease assets | $ 216 | $ 216 | $ 208 | ||
Capital lease assets, accumulated depreciation | 72 | 72 | $ 107 | ||
Depreciation expense | $ 40 | $ 40 | 118 | $ 126 | |
Leaseholds and Leasehold Improvements [Member] | |||||
Investment in property and equipment | $ 72 |
Property and Equipment, Net (Summary of Property and Equipment, Net) (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Cost | $ 1,434,697 | $ 1,481,613 |
Accumulated Depreciation | (939,191) | (1,049,872) |
Net | 495,506 | 431,741 |
Capitalized Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 971,678 | 1,029,772 |
Accumulated Depreciation | (761,926) | (829,416) |
Net | 209,752 | 200,356 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 337,017 | 346,846 |
Accumulated Depreciation | (161,892) | (207,484) |
Net | 175,125 | 139,362 |
Building and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 32,711 | 32,834 |
Accumulated Depreciation | (15,373) | (12,972) |
Net | 17,338 | 19,862 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 93,291 | 72,161 |
Net | $ 93,291 | $ 72,161 |
Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Dec. 31, 2017 |
|
Schedule Of Goodwill And Other Intangible Assets [Line Items] | |||||
Customer loyalty payments in cash | $ 73,349 | $ 54,592 | |||
Amount payable for customer loyalty payments | $ 61,000 | 61,000 | $ 77,000 | ||
Japan Acquisition | |||||
Schedule Of Goodwill And Other Intangible Assets [Line Items] | |||||
Amortization expense | 10,000 | $ 10,000 | 30,000 | 31,000 | |
Customer Loyalty Payments [Member] | |||||
Schedule Of Goodwill And Other Intangible Assets [Line Items] | |||||
Amortization expense | 20,000 | $ 20,000 | 65,000 | $ 57,000 | |
Impairment recognized during the year | $ 3,000 | $ 14,000 |
Other Non-Current Assets (Narrative) (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Other Assets, Noncurrent [Abstract] | ||
Restricted Cash, Noncurrent | $ 3,473 | $ 0 |
Cash and Cash Equivalents, at Carrying Value | $ 200,333 | $ 122,039 |
Other Non-Current Assets (Summary of Other Non-Current Assets) (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Other Assets, Noncurrent Disclosure [Abstract] | ||
Prepaid incentives | $ 32,055 | $ 35,645 |
Pension assets | 10,013 | 8,674 |
Derivative assets | 8,181 | 3,503 |
Supplier prepayments | 4,312 | 10,983 |
Deferred financing costs | 1,620 | 1,930 |
Restricted cash | 3,473 | 0 |
Other | 12,871 | 16,073 |
Other non-current assets, Total | $ 72,525 | $ 76,808 |
Restructuring Charges (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |
---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2018 |
|
Restructuring and Related Activities [Abstract] | |||
Severance Accrual | $ 15 | ||
Restructuring charges recognized | $ 2 | $ 8 |
Accrued Expenses and Other Current Liabilities (Narrative) (Details) - USD ($) $ in Millions |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Payables and Accruals [Abstract] | ||
Accrued customer loyalty payments | $ 61 | $ 77 |
Accrued Expenses and Other Current Liabilities (Summary of Accrued Expenses and Other Current Liabilities) (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Payables and Accruals [Abstract] | ||
Accrued commissions and incentives | $ 328,361 | $ 282,954 |
Deferred revenue | 66,381 | 48,096 |
Accrued payroll and related | 81,683 | 70,234 |
Customer prepayments | 25,643 | 15,774 |
Income tax payable | 29,009 | 32,986 |
Derivative liabilities | 13,769 | 292 |
Accrued interest expense | 9,442 | 12,010 |
Pension and post-retirement benefit liabilities | 1,607 | 1,628 |
Other | 18,365 | 45,094 |
Accrued expenses and other current liabilities | $ 574,260 | $ 509,068 |
Long-Term Debt (Senior Secured Notes) (Narrative) (Details) - USD ($) |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
|
Term Loans | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 1,379,511,000 | ||
Senior Secured Credit Agreement | Credit Agreement 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Principal amounts of term loans | 1,393,000,000 | $ 1,400,000,000 | |
Senior Secured Credit Agreement | Credit Agreement 2014 [Member] | |||
Debt Instrument [Line Items] | |||
Principal amounts of term loans | $ 2,154,000,000 | ||
Senior Secured Credit Agreement | Term Loans | Credit Agreement 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Long-term debt | 1,379,511,000 | ||
Senior Secured Credit Agreement | Term Loans | Credit Agreement 2014 [Member] | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 2,124,439,000 | ||
Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Principal amounts of term loans | 745,000,000 | ||
Long-term debt | $ 737,881,000 | ||
Variable interest rate percentage | 6.00% |
Long-Term Debt (Debt Finance Costs) (Narrative) (Details) - USD ($) $ in Millions |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Debt Instrument [Line Items] | ||
Debt finance cost in relation to letter of credit facility | $ 2 | $ 2 |
Senior Secured Credit Agreement | ||
Debt Instrument [Line Items] | ||
Unamortized debt finance costs | 7 | 13 |
Senior Secured Credit Agreement | Credit Agreement 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt finance costs | 7 | |
Senior Secured Credit Agreement | Credit Agreement 2014 [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt finance costs | $ 13 | |
Senior Secured Notes | ||
Debt Instrument [Line Items] | ||
Unamortized debt finance costs | $ 7 |
Long-Term Debt (Aggregate Maturities of Debt) (Details) $ in Thousands |
Sep. 30, 2018
USD ($)
|
---|---|
Capital Leases and Other Indebtedness, 2019 | $ 44,378 |
Capital Leases and Other Indebtedness, 2020 | 42,198 |
Capital Leases and Other Indebtedness, 2021 | 36,038 |
Capital Leases and Other Indebtedness, 2022 | 23,321 |
Capital Leases, Future Minimum Payments Due Thereafter | 1,221 |
Capital Leases and Other Indebtedness, Total | 147,156 |
Senior Secured Notes | |
Debt, Thereafter | 745,000 |
Long-term debt, Total | 745,000 |
Less: Unamortized debt finance cost | (7,119) |
Less: Unamortized debt discount | 0 |
Long-term Debt, Total | 737,881 |
Term Loans | |
Debt, 2019 | 14,000 |
Debt, 2020 | 14,000 |
Debt, 2021 | 14,000 |
Debt, 2022 | 14,000 |
Debt, 2023 | 14,000 |
Debt, Thereafter | 1,322,500 |
Long-term debt, Total | 1,392,500 |
Less: Unamortized debt finance cost | (6,551) |
Less: Unamortized debt discount | (6,438) |
Long-term Debt, Total | $ 1,379,511 |
Long-Term Debt (Summary of Movement in Deferred Financing Costs) (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Deferred Finance Costs Noncurrent Net [Roll Forward] | ||
Balance as of January 1 | $ 14,708 | $ 22,855 |
Capitalization of debt finance costs | 14,799 | 686 |
Amortization | (2,139) | (4,033) |
Write-off on early extinguishment of debt | (12,078) | (3,306) |
Balance as of December 31 | $ 15,290 | $ 16,202 |
Financial Instruments (Narrative) (Details) $ in Millions |
9 Months Ended |
---|---|
Sep. 30, 2018
USD ($)
| |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Net asset position related to derivative financial instruments | $ 6 |
Probability of default percentage | 5.00% |
Credit default recovery rate percentage, derivative assets | 75.00% |
Credit default recovery rate percentage, derivative liabilities | 65.00% |
Credit risk fair value adjustments, percentage | 15.00% |
Change in unobservable inputs percentage | 10.00% |
Average Libor Rate Applied For Year | 2.03% |
Financial Instruments (Notional Amounts of Derivative Contracts) (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Interest rate swaps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | $ 3,200,000 | $ 3,000,000 |
Foreign currency contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | $ 439,137 | $ 373,487 |
Financial Instruments (Summary of Reconciliation of Net Carrying Amount of Derivative Financial Instruments) (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Derivative Fair Value Of Derivative Net [Roll Forward] | ||
Net derivative liability opening balance | $ 18,393 | $ (19,196) |
Total loss for the period included in net income | (460) | 12,099 |
Payment on settlement of foreign currency derivative contracts | (11,526) | 13,495 |
Net derivative asset (liability) closing balance | $ 6,407 | $ 6,398 |
Financial Instruments (Impact of Changes in Fair Values of Derivatives) (Details) - Derivatives not designated as hedging instruments - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Derivatives, Fair Value [Line Items] | ||||
Amount of Gain (Loss) Recorded in Net Income | $ (3,558) | $ 5,570 | $ (460) | $ 12,099 |
Interest rate swaps | Interest expense, net | ||||
Derivatives, Fair Value [Line Items] | ||||
Amount of Gain (Loss) Recorded in Net Income | 2,143 | 1,332 | 18,231 | (3,322) |
Foreign currency contracts | Selling, general and administrative | ||||
Derivatives, Fair Value [Line Items] | ||||
Amount of Gain (Loss) Recorded in Net Income | $ (5,701) | $ 4,238 | $ (18,691) | $ 15,421 |
Financial Instruments (Fair Values of Company's Other Financial Instruments) (Details) - USD ($) $ in Thousands |
Sep. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Fair Value Of Financial Instruments [Line Items] | ||
Derivative liabilities | $ (13,769) | $ (292) |
Total debt | (2,264,548) | (2,230,013) |
Carrying Amount [Member] | Level 2 | ||
Fair Value Of Financial Instruments [Line Items] | ||
Derivative assets | 20,176 | 18,736 |
Derivative liabilities | (13,769) | (343) |
Total debt | (2,264,548) | (2,230,013) |
Fair Value [Member] | Level 2 | ||
Fair Value Of Financial Instruments [Line Items] | ||
Derivative assets | 20,176 | 18,736 |
Derivative liabilities | (13,769) | (343) |
Total debt | $ (2,291,939) | $ (2,258,893) |
Commitments and Contingencies (Narrative) (Details) $ in Millions |
Sep. 30, 2018
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
Outstanding purchase commitments | $ 85 |
Purchase obligation for next 12 months | $ 48 |
Equity (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions |
1 Months Ended | 3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|---|
Oct. 31, 2018 |
Apr. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Equity Note [Line Items] | ||||||
Cash dividends declared per common share (in dollars per share) | $ 0.075 | $ 0.075 | $ 0.225 | $ 0.225 | ||
Subsequent Event | ||||||
Equity Note [Line Items] | ||||||
Cash dividends declared per common share (in dollars per share) | $ 0.075 | |||||
Dividend payable, declaration date | Oct. 31, 2018 | |||||
IGT Solutions Private Ltd [Member] | ||||||
Equity Note [Line Items] | ||||||
Equity Method Investment, Ownership Percentage | 51.00% | |||||
Proceeds from Sale of Equity Method Investments | $ 18 | |||||
Equity Method Investment, Realized Gain (Loss) on Disposal | 1 | |||||
Reclassification of loss on currency translation adjustment from accumulated other comprehensive loss | $ 4 |
Equity (Summary of cash dividends declared) (Details) - USD ($) $ / shares in Units, $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Dividend Per Share | $ 0.225 | $ 0.225 |
Dividend Declaration One [Member] | ||
Dividend Per Share | $ 0.075 | |
Declaration Date | Feb. 16, 2018 | |
Record Date | Mar. 01, 2018 | |
Payment Date | Mar. 15, 2018 | |
Amount (in $ thousands) | $ 9,406 | |
Dividend Declaration Two [Member] | ||
Dividend Per Share | $ 0.075 | |
Declaration Date | May 02, 2018 | |
Record Date | Jun. 07, 2018 | |
Payment Date | Jun. 21, 2018 | |
Amount (in $ thousands) | $ 9,459 | |
Dividend Declaration Three [Member] | ||
Dividend Per Share | $ 0.075 | |
Declaration Date | Aug. 01, 2018 | |
Record Date | Sep. 06, 2018 | |
Payment Date | Sep. 20, 2018 | |
Amount (in $ thousands) | $ 9,473 |
Equity-Based Compensation (Narrative 1 RSUs) (Details) - Restricted Share Units (RSU) - shares |
3 Months Ended | 9 Months Ended |
---|---|---|
Mar. 31, 2018 |
Sep. 30, 2018 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of awards granted | 857,133 | |
Share-based Compensation Award, Tranche One [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of awards granted | 596,063 | |
Share-based Compensation Award, Tranche Two [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of awards granted | 202,100 |
Equity-Based Compensation (Narrative 2 PSEs) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2018 |
Mar. 31, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Future equity-based compensation expense | $ 29 | $ 29 | |||
Total equity-based compensation expense | 0 | $ 9 | 12 | $ 24 | |
Equity-based compensation expense net of tax | 0 | 8 | 11 | 22 | |
Income tax benefit related to stock-based compensation expense | $ 0 | $ 1 | $ 1 | $ 2 | |
Performance Share Units (PSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of awards granted | 1,246,803 |
Equity-Based Compensation (Narrative 3 Stock Options) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Allocated Share-based Compensation Expense | $ 0 | $ 9 | $ 12 | $ 24 |
Allocated Share-based Compensation Expense, Net of Tax | 0 | 8 | 11 | 22 |
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | 0 | $ 1 | 1 | $ 2 |
Future equity-based compensation expense | $ 29 | $ 29 |
Equity-Based Compensation (Summary of Company's Equity Award Programs RSUs) (Details) - Restricted Share Units (RSU) |
9 Months Ended |
---|---|
Sep. 30, 2018
$ / shares
shares
| |
Number of RSUs | |
Beginning Balance | shares | 1,526,280 |
Granted at fair market value | shares | 857,133 |
Vested | shares | (433,359) |
Forfeited | shares | (316,898) |
Ending Balance | shares | 1,633,156 |
Weighted Average Grant Date Fair Value | |
Beginning Balance | $ / shares | $ 13.01 |
Granted at fair market value | $ / shares | 14.62 |
Vested | $ / shares | 12.95 |
Forfeited | $ / shares | 13.31 |
Ending Balance | $ / shares | $ 13.81 |
Equity-Based Compensation (Summary of Company's Equity Award Programs) (Table Narrative) (Details) |
9 Months Ended |
---|---|
Sep. 30, 2018
shares
| |
Restricted Share Units (RSU) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Restricted share units and stock options, net share settlements | 152,975 |
Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options, Vested Shares Deferred | 51,396 |
Performance Based Restricted Share Units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Restricted share units and stock options, net share settlements | 3,321 |
Equity-Based Compensation (Summary of activity of PSUs) (Details) - Performance Based Restricted Share Units [Member] |
9 Months Ended |
---|---|
Sep. 30, 2018
$ / shares
shares
| |
Number of PSUs | |
Beginning Balance | 2,694,999 |
Granted at fair market value | 1,444,522 |
Forfeited | (825,573) |
Vested | (11,290) |
Ending Balance | 3,302,658 |
Weighted Average Grant Date Fair Value | |
Beginning Balance | $ / shares | $ 13.10 |
Granted at fair market value | $ / shares | 16.33 |
Forfeited | $ / shares | 13.57 |
Vested | $ / shares | 15.50 |
Ending Balance | $ / shares | $ 14.37 |
Estimated awards that will vest | 2,122,960 |
Income Per Share (Narrative) (Details) - shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Common share equivalents excluded from the calculation of diluted income per share | 0 | 2,300,000 | 1,000,000 | 2,400,000 |
Discontinued Operations (Narrative) (Details) $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2018
USD ($)
| |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Group, Including Discontinued Operation, Release Of Liability | $ (28) |
Subsequent Events (Narrative) (Details) - $ / shares |
1 Months Ended | 3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|---|
Oct. 31, 2018 |
Sep. 30, 2018 |
Sep. 30, 2017 |
Sep. 30, 2018 |
Sep. 30, 2017 |
|
Subsequent Event [Line Items] | |||||
Dividend per share | $ 0.075 | $ 0.075 | $ 0.225 | $ 0.225 | |
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Dividend per share | $ 0.075 | ||||
Dividend payable, declaration date | Oct. 31, 2018 | ||||
Dividend payable, payment date | Dec. 20, 2018 | ||||
Dividend payable, record date | Dec. 06, 2018 |
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