| TRX Reports First Quarter 2009 Results |
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ATLANTA, 20 May 2009 — TRX, Inc. (www.trx.com) (NASDAQ: TRXI), a global leader in travel technology and data services, today reported financial results for the quarter ended 31 March 2009. Total revenues excluding client reimbursements for the first quarter of 2009 were $14.9 million compared with $21.9 million in the first quarter of 2008. Net loss for the first quarter was ($43.6) million, which included a $43.7 million non-cash charge for the impairment of goodwill, intangible assets and other long-lived assets, compared with a net loss of ($3.4) million in the first quarter of 2008. Net loss per diluted share was ($2.37) compared to net loss per diluted share of ($0.18) for the first quarter of 2008. Revenues from transaction processing services for the first quarter of 2009 decreased to $12.0 million from $17.6 million in the first quarter of 2008. Revenues from data reporting services were $2.9 million, compared with $4.2 million in the prior year. Adjusted revenues for the first quarter of 2009 were $14.9 million compared with adjusted revenues of $25.4 million in the first quarter of 2008. Revenues from data reporting services were $2.9 million, compared with adjusted revenues of $7.7 million in the first quarter of 2008. Adjusted EBITDA was $2.0 million for the quarter, compared with $2.9 million in the first quarter of 2008. Adjusted revenues and EBITDA in the first quarter of 2008 include $3.5 million of recurring data reporting services which were required to be deferred under US GAAP until the Company’s sale of a non-exclusive DATATRAX license to Citibank. The license sale occurred in the second quarter of 2008. Adjusted EBITDA in the first quarter of 2009 includes $1.0 million of severance expenses associated with the Company’s cost reduction efforts and also reflects $1.8 million of one-time reductions in personnel-related accrued expenses. “The travel environment in 2009 continues to reflect the current global economic condition, typified by lower volumes and increased pressure on pricing, cost control and downward pressure on industry stock valuations,” said TRX President and CEO Shane Hammond. “TRX is adapting to these fast-moving conditions by continuing the transition to a Software-as-a-Service solutions provider to deliver improved efficiency and an increased ability to drive cost savings to our clients. In addition, we are aggressively managing our infrastructure costs to provide the highest level of service and prudent capital investments through this difficult economic environment. We remain focused on delivering maximum value to all clients across our data intelligence, online booking, and reservation processing solutions.” |
| Use of Non-GAAP Financial Measures |
| TRX provides financial measures and terms not calculated in accordance with accounting principles generally accepted in the United States (GAAP). Presentation of non-GAAP measures such as Adjusted Revenues, Adjusted Data Reporting Revenues, EBITDA and Adjusted EBITDA provide investors with an alternative method for assessing our operating results in a manner that enables investors to more thoroughly evaluate our performance. These non-GAAP measures provide a baseline for assessing the company’s future earnings expectations. TRX management uses these non-GAAP measures for the same purpose. The non-GAAP measures included in this release are provided to give investors access to the types of measures that we use in analyzing our results.
Adjusted Revenues and Adjusted Data Reporting Revenues consist of GAAP transaction and other revenues, adjusted for the revenue earned from Citibank for providing routine services, which was required under US GAAP to be deferred until the sale of a software license to Citibank was complete, which occurred on April 30, 2008. The deferral of revenue recognition was required in the absence of vendor-specific objective evidence of the fair value of the license. Management uses Adjusted Revenue and Adjusted Data Reporting Revenue as additional measures for evaluating the performance of the business, because the pricing for and level of routine services currently being provided to Citibank are equivalent to those provided to Citibank before the arrangement to sell a license was consummated in July 2007. EBITDA consists of GAAP net loss adjusted for the items included in the accompanying reconciliation. EBITDA provides useful information to investors about the Company’s performance because it eliminates the effects of period to period changes in the cost associated with capital investments and interest expense. Adjusted EBITDA consists of EBITDA adjusted for the items included in the accompanying reconciliation. EBITDA and Adjusted EBITDA do not give effect to the cash the Company must use to service its debt or pay its income taxes and thus do not reflect the funds generated from operations or actually available for capital expenditures. TRX’s calculation of Adjusted Revenues, Adjusted Data Reporting Revenues, EBITDA and Adjusted EBITDA is not necessarily comparable to similarly titled measures reported by other companies. These non-GAAP measures may be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. Schedules that reconcile Adjusted Revenues, EBITDA and Adjusted EBITDA to GAAP net loss and Adjusted Data Reporting Revenues to GAAP Data Reporting Revenues are included with this release. |
| Cautionary Note Regarding Forward-Looking Statements |
| TRX provides financial measures and terms not calculated in accordance with accounting principles generally accepted in the United States (GAAP). Presentation of non-GAAP measures such as Adjusted Revenues, Adjusted Data Reporting Revenues, EBITDA and Adjusted EBITDA provide investors with an alternative method for assessing our operating results in a manner that enables investors to more thoroughly evaluate our performance. These non-GAAP measures provide a baseline for assessing the company’s future earnings expectations. TRX management uses these non-GAAP measures for the same purpose. The non-GAAP measures included in this release are provided to give investors access to the types of measures that we use in analyzing our results.
Adjusted Revenues and Adjusted Data Reporting Revenues consist of GAAP transaction and other revenues, adjusted for the revenue earned from Citibank for providing routine services, which was required under US GAAP to be deferred until the sale of a software license to Citibank was complete, which occurred on April 30, 2008. The deferral of revenue recognition was required in the absence of vendor-specific objective evidence of the fair value of the license. Management uses Adjusted Revenue and Adjusted Data Reporting Revenue as additional measures for evaluating the performance of the business, because the pricing for and level of routine services currently being provided to Citibank are equivalent to those provided to Citibank before the arrangement to sell a license was consummated in July 2007. EBITDA consists of GAAP net loss adjusted for the items included in the accompanying reconciliation. EBITDA provides useful information to investors about the Company’s performance because it eliminates the effects of period to period changes in the cost associated with capital investments and interest expense. Adjusted EBITDA consists of EBITDA adjusted for the items included in the accompanying reconciliation. EBITDA and Adjusted EBITDA do not give effect to the cash the Company must use to service its debt or pay its income taxes and thus do not reflect the funds generated from operations or actually available for capital expenditures. TRX’s calculation of Adjusted Revenues, Adjusted Data Reporting Revenues, EBITDA and Adjusted EBITDA is not necessarily comparable to similarly titled measures reported by other companies. These non-GAAP measures may be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. Schedules that reconcile Adjusted Revenues, EBITDA and Adjusted EBITDA to GAAP net loss and Adjusted Data Reporting Revenues to GAAP Data Reporting Revenues are included with this release. |
| Pre-recorded Call Information |
| After the earnings release has been furnished to the SEC, a pre-recorded call offering additional comments on the quarter will be available to all investors at www.trx.com under the Investors section of the website, both as a webcast and in the form of transcript. An archived webcast and transcript will remain available on the company's Website for approximately 90 days. |
| Links to Financial Reports |
About TRX
TRX is a world-leading travel technology and data services provider, offering more than 20 software-as-a-service utilities for online booking, reservation processing, data intelligence, and process automation. We deliver our technology applications in an on-demand environment to travel agencies, corporations, travel suppliers, government agencies, credit card associations, credit card issuing banks, and third-party administrators. We provide patented savings maximization solutions via our travel analytics consulting practice, extending spend management services to travel buyers all over the world. We complement all of these offerings with a global workforce focused on travel process automation and reengineering. For more information about TRX or to contact a TRX sales office, phone 404.929.6100 or visit the company's Web site at www.trx.com.| Investor Contacts: | David Cathcart Chief Financial Officer, TRX, Inc. (404) 929-6154 ; |
| Media Contacts: | Stephen Carroll
Senior Director, Product Marketing, TRX, Inc. (214) 346-4758 |