Serko deal with Sabre to add $1 mln in annual revenue from late 2017
By Paul McBeth
Aug. 23 (BusinessDesk) - Serko has signed a deal with Nasdaq-listed Sabre Corp to use the online travel booking tool on the US company's platform, which the Kiwi firm says will boost annual sales by at least $1 million.
The tie-up would mean users of Sabre's online platform would also be able to add Serko's services as an add-on, with an upgrade of the Sabre network slated for the third quarter of this year, and the Auckland-based anticipates revenue will get a boost from the second half of the 2017 financial year.
"It gives Sabre access to a broader corporate online booking portfolio and gives Serko access to a market of mid-sized organisations, which is growing faster than any other market," Serko chief executive Darrin Graton said. "Additionally, both Sabre and Serko’s Travel Management Company customers will have access to a wider range of corporate travel solutions while enjoying the operational benefits of using a single underlying booking platform."
The announcement came just before Serko's annual meeting in Auckland, where chairman Simon Botherway reaffirmed the company's guidance to achieve a monthly break-even and positive cash-flow by the end of the 2017 March year.
Botherway said Serko's cash reserves were $5.8 million as at July 31 and wants to keep the balance between $3 million and $4 million at the end of the financial year onMarch 31, 2017.
Serko's first-quarter recurring revenue was 9 percent higher than a year earlier and 7 percent up in aggregate, and Botherway said the loss before interest, tax, depreciation and amortisation showed a "substantial improvement" from the first quarter of 2016.
"We are not in a position to guide with respect to revenue expectations for the full-year ended March 2017 due to the difficulties in forecasting the timing and rate of growth tied to a number of new contracts, products and some strategic partnership initiatives that we are currently working on," he said.
The shares were unchanged at 60 cents, having dropped by a third so far this year.