American Express Global Business Travel, which is operated by
Global Business Travel Group, Inc. (NYSE: GBTG) (“Amex GBT” or the
“Company”), the world’s leading B2B travel platform, today
announced financial results for the fourth quarter and full year
ended December 31, 2022.
Fourth Quarter and Full-Year 2022 Highlights
Revenue and Adjusted EBITDA Ahead of Full-Year 2022 Guidance
- Delivered full-year 2022 revenue of $1.85 billion and Adjusted
EBITDA1 of $103 million.
- Q4 2022 revenue increased 84% from Q4 2021 to $527 million, and
revenue recovery reached 75% of 2019 pro forma2 revenue, up from
72% in Q3 2022.
- Q4 2022 Adjusted EBITDA1 totaled $43 million, with an Adjusted
EBITDA Margin3 of 8.2%. Net loss totaled ($63) million.
- Significantly reduced cash usage: Q4 2022 net cash used in
operating activities of ($4) million and Free Cash Flow4 of ($25)
million.
Continued SME Momentum
- Q4 2022 SME transaction recovery reached 82% of 2019 pro forma1
levels, versus 80% in Q3 2022.
- SME New Wins Value for full-year 2022 totaled $2.1 billion at
current recovery levels.
- SME win rate and customer satisfaction at all-time highs.
Positioned for Continued Strong Growth
- Q4 2022 total transaction recovery reached 72% of 2019 pro
forma1 levels, versus 71% in Q3 2022 and up 26 points
year-over-year.
- Total New Wins Value for full-year 2022 totaled $3.5 billion at
current recovery levels.
- 95% customer retention rate for full-year 2022.
Paul Abbott, Amex GBT Chief Executive Officer, stated: “The
fourth quarter marks a strong finish to 2022. Record new wins, high
customer retention and strong momentum in the SME segment delivered
results ahead of our guidance for the year. With continued strong
revenue growth and the momentum of three straight quarters of
positive Adjusted EBITDA, we are well positioned for continued
strong growth in revenue, profitability and cash flow as we look
ahead to 2023 and beyond.”
Fourth Quarter and Full-Year 2022 Financial Summary
(in millions, except percentages;
unaudited)
Three Months Ended
% B/(W)
Year Ended
% B/(W)
December 31,
December 31,
2022
2021
2022
2021
Total Transaction Value (TTV)
$5,913
$2,743
116%
$22,968
$6,392
259%
Transaction Growth
81%
200%
Revenue
$527
$287
84%
$1,851
$763
143%
Travel Revenue
$412
$185
122%
$1,444
$446
224%
Product and Professional Services
Revenue
$115
$102
14%
$407
$317
28%
Total operating expenses
$565
$480
(18%)
$2,049
$1,323
(55%)
Net loss
($63)
($200)
NM
($229)
($475)
NM
Net cash used in operating activities
($4)
($169)
NM
($394)
($512)
NM
EBITDA5
($8)
($146)
NM
($10)
($406)
NM
Adjusted EBITDA1
$43
($101)
NM
$103
($340)
NM
Adjusted Operating Expenses6
$484
$382
(27%)
$1,745
$1,095
(59%)
Free Cash Flow4
($25)
($185)
NM
($488)
($556)
NM
Fourth Quarter 2022 Financial Highlights7
Revenue increased $240 million, or 84%, versus the same period
in 2021. Within this, Travel Revenue increased $227 million, or
122%, due to incremental revenue of $81 million resulting from the
Egencia consolidation and $146 million primarily resulting from
Transaction Growth driven by the continued recovery in business
travel. Product and Professional Services Revenue increased $13
million, or 14%, primarily due to increased Meetings and Events
revenue driven by strengthening demand. Pro forma for the
acquisition of Egencia, total fourth quarter 2022 revenue increased
71% from the fourth quarter of 2021.
Total operating expense increased $85 million, or 18%, primarily
due to the inclusion of Egencia’s operating expenses in the fourth
quarter of 2022, increased cost of revenue to support the rise in
the volume of transactions, higher general and administrative
costs, increased technology and content expenses and higher sales
and marketing costs, partially offset by lower restructuring
charges and depreciation and amortization.
Net loss improved $137 million, primarily due to a decrease in
operating loss and a reduction in loss on early extinguishment of
debt partially offset by a lower benefit from income taxes,
increased interest expense and higher fair value movement on
earnout liabilities. Pro forma for the acquisition of Egencia,
fourth quarter 2022 net loss improved by $152 million compared to
the fourth quarter of 2021.
Adjusted EBITDA1 improved $144 million, primarily due to revenue
growth, partially offset by increased Adjusted Operating Expenses.
Pro forma for the acquisition of Egencia, fourth quarter 2022
Adjusted EBITDA improved by $145 million compared to the fourth
quarter of 2021.
Adjusted Operating Expenses6 increased $102 million, or 27%,
primarily due to the inclusion of Egencia’s operating expenses in
the fourth quarter of 2022, increased cost of revenue to support
the rise in the volume of transactions, higher general and
administrative costs, and increased technology and content
expenses.
Net cash used in operating activities decreased $165 million,
primarily due to the reduction in net loss and less cash utilized
for working capital.
Free Cash Flow4 improved $160 million, primarily due to the
decrease in net cash used in operating activities, partially offset
by increased cash outflow for the purchase of property and
equipment.
Full-Year 2022 Financial Highlights7
Revenue increased $1,088 million, or 143%, versus 2021. Within
this, Travel Revenue increased $998 million, or 224%, due to
incremental revenue of $343 million resulting from the Egencia
consolidation and $655 million primarily resulting from Transaction
Growth driven by the continued recovery in business travel. Product
and Professional Services Revenue increased $90 million, or 28%,
primarily due to increased Meetings and Events revenue driven by
strengthening demand, Egencia consolidation and increases in other
products, services and consulting revenues as business volumes
returned. Pro forma for the acquisition of Egencia, total 2022
revenue increased 108% from 2021.
Total operating expense increased $726 million, or 55%,
primarily due to the inclusion of Egencia’s operating expenses for
full-year 2022, increased cost of revenue to support the rise in
the volume of transactions, higher general and administrative
costs, increased sales and marketing costs, higher technology and
content expenses and increased depreciation and amortization,
partially offset by lower restructuring charges.
Net loss improved $246 million, primarily due to a decrease in
operating loss partially offset by a lower benefit from income
taxes. Pro forma for the acquisition of Egencia, full-year 2022 net
loss improved by $475 million compared to full-year 2021.
Adjusted EBITDA1 improved by $443 million, primarily due to
revenue growth, partially offset by increased Adjusted Operating
Expenses. Pro forma for the acquisition of Egencia, full-year 2022
Adjusted EBITDA improved by $623 million compared to full-year
2021.
Adjusted Operating Expenses6 increased $650 million, or 59%,
primarily due to the inclusion of Egencia’s operating expenses for
full-year 2022, increased cost of revenue to support the rise in
the volume of transactions, higher general and administrative
costs, increased technology and content expenses and higher sales
and marketing costs.
Net cash used in operating activities decreased $118 million,
primarily due to the reduction in net loss before considering any
non-cash charges, partially offset by cash utilized for working
capital driven by the continued business travel recovery.
Free Cash Flow4 improved $68 million, primarily due to the
decrease in net cash used in operating activities, partially offset
by increased cash outflow for the purchase of property and
equipment.
Net Debt8: As of December 31, 2022, total debt was $1,222
million, compared to $1,023 million as of December 31, 2021. Net
Debt was $919 million as of December 31, 2022, compared to Net Debt
of $507 million as of December 31, 2021. The increase in Net Debt
was driven by a $199 million increase in total debt primarily due
to borrowing under the delayed draw term loan commitments and a
$213 million decrease in cash and cash equivalents.
2023 Guidance
Q1 2023 Guidance
Full-Year 2023
Guidance
Revenue
$550M – $570M
$2.17B – $2.22B
Year-over-Year Growth
57% – 63%
17% – 20%
Adjusted EBITDA1
$75M – $90M
$330M – $370M
Adjusted EBITDA Margin3
15% – 16%
15% – 17%
Martine Gerow, Amex GBT Chief Financial Officer, stated: “In
2023, we expect to deliver double-digit revenue growth, drive
significant margin expansion, and turn Free Cash Flow positive
during the year. Looking beyond 2023, we remain on track to deliver
pre-COVID Adjusted EBITDA of approximately $500 million at an 86%
revenue recovery, or achievement of $2.4 billion in revenue. We are
executing on our commitments to customers and shareholders, and we
are positioned for strong growth in the years ahead.”
The Company’s Q1 2023 and full-year 2023 guidance considers
various material assumptions. Because the guidance is
forward-looking and reflects numerous estimates and assumptions
with respect to future industry performance under various scenarios
as well as assumptions for competition, general business, economic,
market and financial conditions and matters specific to the
business of Amex GBT, all of which are difficult to predict and
many of which are beyond the control of Amex GBT, actual results
may differ materially from the guidance due to a number of factors,
including the ultimate inaccuracy of any of the assumptions
described above and the risks and other factors discussed in the
section entitled “Forward-Looking Statements” below and the risk
factors in the Company’s SEC filings.
The Company has not provided a quantitative reconciliation of
Adjusted EBITDA guidance to forecasted net income (loss) determined
under U.S. generally accepted accounting principles (“GAAP”) within
this press release because the Company cannot, without unreasonable
effort, calculate certain reconciling items with confidence due to
the variability and complexity of the adjusting items that would be
excluded from Adjusted EBITDA guidance. Such adjustments are for
items that are not indicative of the Company’s core operations and
include restructuring and integration charges, mergers and
acquisition costs, equity-based compensation, certain fair value
measurements, including those related to fair value of earnouts,
foreign exchange gains (losses), impairments of long-lived assets
and corresponding income taxes. Further, the Company continuously
evaluates its capital and debt structure that could impact interest
payments. Such adjustments may be affected by changes in ongoing
assumptions, judgements, as well as nonrecurring, unusual or
unanticipated charges, expenses or gains/losses or other items that
may not directly correlate to the underlying performance of the
Company’s business operations. The exact amount of these
adjustments is not currently determinable but may be
significant.
Webcast Information
Amex GBT will host its fourth quarter and full-year 2022
investor conference call today at 9:00 a.m. E.T. The live webcast
and accompanying slide presentation can be accessed on the Amex GBT
Investor Relations website at
investors.amexglobalbusinesstravel.com. A replay of the event will
be available on the website for at least 90 days following the
event.
Glossary of Terms
See the “Glossary of Terms” for the definitions of certain terms
used within this press release.
Non-GAAP Financial Measures
The Company refers to certain financial measures that are not
recognized under GAAP in this press release, including EBITDA,
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Operating
Expenses, Free Cash Flow and Net Debt. See “Non-GAAP Financial
Measures” below for an explanation of these non-GAAP financial
measures and “Tabular Reconciliations for Non-GAAP Financial
Measures” below for reconciliations of the non-GAAP financial
measures to the comparable GAAP measures.
About American Express Global Business Travel
American Express Global Business Travel is the world’s leading
B2B travel platform, providing software and services to manage
travel, expenses, and meetings & events for companies of all
sizes. We have built the most valuable marketplace in B2B travel to
deliver unrivalled choice, value and experiences. With travel
professionals in more than 140 countries, our customers and
travelers enjoy the powerful backing of American Express Global
Business Travel.
Visit amexglobalbusinesstravel.com for more information about
Amex GBT. Follow @amexgbt on Twitter, LinkedIn and Instagram.
GLOBAL BUSINESS TRAVEL GROUP,
INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited)
Year ended December
31,
(in $ millions, except share and per
share data)
2022
2021
2020
Revenue
$
1,851
$
763
$
793
Costs and expenses:
Cost of revenue (excluding depreciation
and amortization shown separately below)
832
477
529
Sales and marketing
337
201
199
Technology and content
388
264
277
General and administrative
313
213
181
Restructuring charges
(3
)
14
206
Depreciation and amortization
182
154
148
Total operating expenses
2,049
1,323
1,540
Operating loss
(198
)
(560
)
(747
)
Interest income
—
1
1
Interest expense
(98
)
(53
)
(27
)
Fair value movement on earnouts and
warrants derivative liabilities
8
—
—
Loss on early extinguishment of debt
—
(49
)
—
Other income, net
1
8
14
Loss before income taxes and share of
losses from equity method investments
(287
)
(653
)
(759
)
Benefit from income taxes
61
186
145
Share of losses from equity method
investments
(3
)
(8
)
(5
)
Net loss
(229
)
(475
)
(619
)
Less: net loss attributable to
non-controlling interests in subsidiaries
(204
)
(475
)
(619
)
Net loss attributable to the Company’s
Class A common stockholders
$
(25
)
$
—
$
—
Basic loss per share attributable to the
Company’s Class A common stockholders
$
(0.50
)
Weighted average number of shares
outstanding – Basic
51,266,570
Diluted loss per share attributable to the
Company’s Class A common stockholders
$
(0.51
)
Weighted average number of shares
outstanding – Diluted
445,715,051
GLOBAL BUSINESS TRAVEL GROUP,
INC.
CONSOLIDATED BALANCE
SHEETS
(Unaudited)
As of December 31,
(in $ millions except share and per
share data)
2022
2021
Assets
Current assets:
Cash and cash equivalents
$
303
$
516
Accounts receivable (net of allowance for
credit losses of $23 and $4 as of December 31, 2022 and 2021,
respectively)
765
381
Due from affiliates
36
18
Prepaid expenses and other current
assets
130
137
Total current assets
1,234
1,052
Property and equipment, net
218
216
Equity method investments
14
17
Goodwill
1,188
1,358
Other intangible assets, net
636
746
Operating lease right-of-use assets
58
59
Deferred tax assets
333
282
Other non-current assets
47
41
Total assets
$
3,728
$
3,771
Liabilities, preferred shares and
shareholders’ equity
Current liabilities:
Accounts payable
$
253
$
137
Due to affiliates
48
41
Accrued expenses and other current
liabilities
452
519
Current portion of operating lease
liabilities
17
21
Current portion of long-term debt
3
3
Total current liabilities
773
721
Long-term debt, net of unamortized debt
discount and debt issuance costs
1,219
1,020
Deferred tax liabilities
24
119
Pension liabilities
147
333
Long-term operating lease liabilities
61
61
Earnout derivative liabilities
90
—
Other non-current liabilities
43
23
Total liabilities
2,357
2,277
Commitments and Contingencies
Preferred shares (par value €0.00001;
3,000,000 shares authorized; 1,500,000 shares issued and
outstanding as of December 31, 2021)
—
160
Shareholders’ equity:
Class A common stock (par value $0.0001;
3,000,000,000 shares authorized; 67,753,543 shares issued and
outstanding as of December 31, 2022)
—
—
Class B common stock (par value $0.0001;
3,000,000,000 shares authorized; 394,448,481 shares issued and
outstanding as of December 31, 2022)
—
—
Voting ordinary shares (par value
€0.00001; 40,000,000 shares authorized; 36,000,000 shares issued
and outstanding as of December 31, 2021)
—
—
Non-voting ordinary shares (par value
€0.00001; 15,000,000 shares authorized as of December 31, 2021;
8,413,972 shares issued and outstanding as of December 31,
2021)
—
—
Profit shares (par value €0.00001; 800,000
shares authorized, issued and outstanding as of December 31,
2021)
Additional paid-in-capital
334
2,560
Accumulated deficit
(175
)
(1,065
)
Accumulated other comprehensive loss
(7
)
(162
)
Total equity of the Company’s
shareholders
152
1,333
Equity attributable to noncontrolling
interest in subsidiaries
1,219
1
Total shareholders’ equity
1,371
1,334
Total liabilities, preferred shares and
shareholders’ equity
$
3,728
$
3,771
GLOBAL BUSINESS TRAVEL GROUP,
INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Unaudited)
Year ended December
31,
(in $ millions)
2022
2021
2020
Operating activities:
Net loss
$
(229
)
$
(475
)
$
(619
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
182
154
148
Deferred tax benefit
(65
)
(178
)
(110
)
Equity-based compensation
39
3
3
Allowance for credit losses
19
(5
)
4
Fair value movements on earnouts and
warrants derivative liabilities
(8
)
—
—
Loss on early extinguishment of debt
—
49
—
Impairment of operating lease ROU and
other assets
—
1
20
Other
22
2
3
Defined benefit pension funding
(32
)
(25
)
(25
)
Proceeds from termination of interest rate
swap derivative contract
23
—
—
Changes in working capital, net of effects
from acquisitions
Accounts receivable
(427
)
(85
)
524
Prepaid expenses and other current
assets
(29
)
40
(20
)
Due from affiliates
(18
)
(3
)
1
Due to affiliates
7
8
(20
)
Accounts payable, accrued expenses and
other current liabilities
122
2
(159
)
Net cash used in operating activities
(394
)
(512
)
(250
)
Investing activities:
Purchase of property and equipment
(94
)
(44
)
(47
)
Ovation business acquisition, net of cash
acquired
—
(53
)
—
Egencia business acquisition, net of cash
acquired
—
73
—
Other
(1
)
(3
)
—
Net cash used in investing activities
(95
)
(27
)
(47
)
Financing activities:
Proceeds from reverse recapitalization,
net
269
—
—
Redemption of preference shares
(168
)
—
—
Proceeds from issuance of preferred
shares
—
150
—
Proceeds from senior secured tranche B-1
term loans, net of debt discount
—
—
388
Proceeds from senior secured tranche B-2
term loans, net of debt discount
—
150
—
Proceeds from senior secured tranche B-3
term loans, net of debt discount
200
785
—
Repayment of senior secured term loans
(3
)
(551
)
(4
)
Repayment of finance lease obligations
(2
)
(2
)
—
Payment of lender fees and issuance costs
for senior secured term loans facilities
—
(8
)
—
Prepayment penalty and other costs related
to early extinguishment of debt
—
(34
)
—
Payment of deferred consideration
(4
)
—
—
Payment of offering costs
—
(10
)
—
Capital distributions to shareholders
—
(1
)
—
Other
—
(1
)
—
Net cash from financing activities
292
478
384
Effect of exchange rates changes on cash,
cash equivalents and restricted cash
(12
)
(7
)
7
Net (decrease) increase in cash, cash
equivalents and restricted cash
(209
)
(68
)
94
Cash, cash equivalents and restricted
cash, beginning of year
525
593
499
Cash, cash equivalents and restricted
cash, end of year
$
316
$
525
$
593
Glossary of Terms
B2B refers to business-to-business.
Customer retention rate is calculated based on Total
Transaction Value (TTV).
SME refers to clients Amex GBT considers
small-to-medium-sized enterprises, which Amex GBT generally defines
as having an expected annual spend on air travel of less than $20
million. This criterion can vary by country and client needs.
SME New Wins Value is calculated using expected annual
average Total Transaction Value (TTV) over the contract term from
new small-to-medium-sized enterprise (“SME”) client wins over the
last twelve months, based on current recovery levels.
Total New Wins Value is calculated using expected annual
average Total Transaction Value (TTV) over the contract term from
all new client wins over the last twelve months, based on current
recovery levels.
Total Transaction Value (or TTV) refers to the sum of the
total price paid by travelers for air, hotel, rail, car rental and
cruise bookings, including taxes and other charges applied by
suppliers at point of sale, less cancellations and refunds.
Transaction Growth (Decline) represents year-over-year
growth or decline as a percentage of the total number of
transactions, including air, hotel, car rental, rail or other
travel-related transactions, recorded at the time of booking and is
calculated on a gross basis to include cancellations, refunds and
exchanges. To calculate year-over-year growth or decline, Amex GBT
compares the total number of transactions in the comparative
previous period/year to the total number of transactions in the
current period/year in percentage terms.
Transaction recovery represents the total number of
transactions, including air, hotel, car rental, rail or other
travel-related transactions, recorded at the time of booking and
calculated on a gross basis to include cancellations, refunds and
exchanges, in the current period as a percentage of the comparative
period in 2019.
Non-GAAP Financial Measures
We report our financial results in accordance with GAAP. Our
non-GAAP financial measures are provided in addition to, and should
not be considered as an alternative to, other performance or
liquidity measure derived in accordance with GAAP. Non-GAAP
financial measures have limitations as analytical tools, and you
should not consider them either in isolation or as a substitute for
analyzing our results as reported under GAAP. In addition, because
not all companies use identical calculations, the presentations of
our non-GAAP financial measures may not be comparable to other
similarly titled measures of other companies and can differ
significantly from company to company.
Management believes that these non-GAAP financial measures
provide users of our financial information with useful supplemental
information that enables a better comparison of our performance or
liquidity across periods. We use EBITDA, Adjusted EBITDA, Adjusted
EBITDA Margin and Adjusted Operating Expenses as performance
measures as they are important metrics used by management to
evaluate and understand the underlying operations and business
trends, forecast future results and determine future capital
investment allocations. We use Free Cash Flow and Net Debt as
liquidity measures and as indicators of our ability to generate
cash to meet our liquidity needs and to assist our management in
evaluating our financial flexibility, capital structure and
leverage. These non-GAAP financial measures supplement comparable
GAAP measures in the evaluation of the effectiveness of our
business strategies, to make budgeting decisions, and/or to compare
our performance and liquidity against that of other peer companies
using similar measures.
We define EBITDA as net income (loss) before interest income,
interest expense, loss on early extinguishment of debt, benefit
from (provision for) income taxes and depreciation and
amortization.
We define Adjusted EBITDA as net income (loss) before interest
income, interest expense, loss on early extinguishment of debt,
benefit from (provision for) income taxes and depreciation and
amortization and as further adjusted to exclude costs that
management believes are non-core to the underlying business of the
Company, consisting of restructuring costs, integration costs,
costs related to mergers and acquisitions, non-cash equity-based
compensation, long-term incentive plan costs, certain corporate
costs, fair value movements on earnouts and warrants derivative
liabilities, foreign currency gains (losses), non-service
components of net periodic pension benefit (costs) and gains
(losses) on disposal of businesses.
We define Adjusted EBITDA Margin as Adjusted EBITDA divided by
revenue.
We define Adjusted Operating Expenses as total operating
expenses excluding depreciation and amortization and costs that
management believes are non-core to the underlying business of the
Company, consisting of restructuring costs, integration costs,
costs related to mergers and acquisitions, non-cash equity-based
compensation, long-term incentive plan costs and certain corporate
costs.
EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted
Operating Expenses are supplemental non-GAAP financial measures of
operating performance that do not represent and should not be
considered as alternatives to net income (loss) or total operating
expenses, as determined under GAAP. In addition, these measures may
not be comparable to similarly titled measures used by other
companies. These non-GAAP measures have limitations as analytical
tools, and these measures should not be considered in isolation or
as a substitute for analysis of the Company’s results or expenses
as reported under GAAP. Some of these limitations are that these
measures do not reflect:
- changes in, or cash requirements for, our working capital needs
or contractual commitments;
- our interest expense, or the cash requirements to service
interest or principal payments on our indebtedness;
- our tax expense, or the cash requirements to pay our
taxes;
- recurring, non-cash expenses of depreciation and amortization
of property and equipment and definite-lived intangible assets and,
although these are non-cash expenses, the assets being depreciated
and amortized may have to be replaced in the future;
- the non-cash expense of stock-based compensation, which has
been, and will continue to be for the foreseeable future, an
important part of how we attract and retain our employees and a
significant recurring expense in our business;
- restructuring, mergers and acquisition and integration costs,
all of which are intrinsic of our acquisitive business model;
and
- impact on earnings or changes resulting from matters that are
non-core to our underlying business, as we believe they are not
indicative of underlying operations.
EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted
Operating Expenses should not be considered as a measure of
liquidity or as a measure determining discretionary cash available
to us to reinvest in the growth of our business or as measures of
cash that will be available to us to meet our obligations. We
believe that the adjustments applied in presenting EBITDA, Adjusted
EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses are
appropriate to provide additional information to investors about
certain material non-cash and other items that management believes
are non-core to our underlying business.
We use these measures as performance measures as they are
important metrics used by management to evaluate and understand the
underlying operations and business trends, forecast future results
and determine future capital investment allocations. These non-GAAP
measures supplement comparable GAAP measures in the evaluation of
the effectiveness of our business strategies, to make budgeting
decisions, and to compare our performance against that of other
peer companies using similar measures. We also believe that EBITDA,
Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating
Expenses are helpful supplemental measures to assist potential
investors and analysts in evaluating our operating results across
reporting periods on a consistent basis.
We define Free Cash Flow as net cash from (used in) operating
activities, less cash used for additions to property and
equipment.
We believe Free Cash Flow is an important measure of our
liquidity. This measure is a useful indicator of our ability to
generate cash to meet our liquidity demands. We use this measure to
conduct and evaluate our operating liquidity. We believe it
typically presents an alternate measure of cash flows since
purchases of property and equipment are a necessary component of
our ongoing operations and it provides useful information regarding
how cash provided by operating activities compares to the property
and equipment investments required to maintain and grow our
platform. We believe Free Cash Flow provides investors with an
understanding of how assets are performing and measures
management’s effectiveness in managing cash.
Free Cash Flow is a non-GAAP measure and may not be comparable
to similarly named measures used by other companies. This measure
has limitations in that it does not represent the total increase or
decrease in the cash balance for the period, nor does it represent
cash flow for discretionary expenditures. This measure should not
be considered as a measure of liquidity or cash flows from
operations as determined under GAAP. This measure is not a
measurement of our financial performance under GAAP and should not
be considered in isolation or as an alternative to net income
(loss) or any other performance measures derived in accordance with
GAAP or as an alternative to cash flows from operating activities
as a measure of liquidity.
We define Net Debt as total debt outstanding consisting of
current and non-current portion of long-term debt (defined as debt
(excluding lease liabilities) with original contractual maturity
dates of one year or greater), net of unamortized debt discount and
unamortized debt issuance costs, minus cash and cash
equivalents.
Net Debt is a non-GAAP measure and may not be comparable to
similarly named measures used by other companies. This measure is
not a measurement of our indebtedness as determined under GAAP and
should not be considered in isolation or as an alternative to
assess our total debt or any other measures derived in accordance
with GAAP or as an alternative to total debt. Management uses Net
Debt to review our overall liquidity, financial flexibility,
capital structure and leverage. Further, we believe that certain
debt rating agencies, creditors and credit analysts monitor our Net
Debt as part of their assessment of our business.
Pro Forma Financial Information
This press release includes certain pro forma financial
information. The pro forma adjustments assume that the Company
acquired Egencia, Ovation and DER as of January 1, 2019 and include
a constant currency adjustment. The pro forma financial information
is unaudited and is presented for illustrative purposes only (and
not for purposes of Article 11 of Regulation S-X) and is not
necessarily indicative of the operating results or financial
position that would have occurred if the relevant transactions had
been consummated on the date indicated, nor is it indicative of
future operating results. The pro forma financial information is
based on certain assumptions which may or may not be realized,
including as a result of risks and other factors discussed in the
section entitled “Forward-Looking Statements” below and the risk
factors in the Company’s SEC filings.
Tabular Reconciliations for Non-GAAP Measures
Reconciliation of net loss to EBITDA and Adjusted EBITDA:
Three Months Ended December
31,
Year Ended December
31,
($ in millions)
2022
2021
2022
2021
Net loss
$
(63
)
$
(200
)
$
(229
)
$
(475
)
Interest income
—
(1
)
—
(1
)
Interest expense
29
16
98
53
Loss on early extinguishment of debt
—
49
—
49
Benefit from income taxes
(22
)
(60
)
(61
)
(186
)
Depreciation and amortization
48
50
182
154
EBITDA
(8
)
(146
)
(10
)
(406
)
Restructuring charges(a)
2
19
(3
)
14
Integration costs(b)
9
13
34
22
Mergers and acquisitions(c)
(3
)
1
18
14
Equity-based compensation(d)
16
2
39
3
Fair value movements on earnout and
warrants derivative liabilities(e)
22
—
(8
)
—
Other adjustments, net(f)
5
10
33
13
Adjusted EBITDA
$
43
$
(101
)
$
103
$
(340
)
Net loss margin
(12
%)
(70
%)
(12
%)
(62
%)
Adjusted EBITDA Margin
8
%
(35
%)
6
%
(45
%)
Reconciliation total operating expenses to Adjusted Operating
Expenses:
Three Months Ended December
31,
Year Ended December
31,
($ in millions)
2022
2021
2022
2021
Total operating expenses
$
565
$
480
2,049
$
1,323
Adjustments:
Depreciation and amortization
(48
)
(50
)
(182
)
(154
)
Restructuring charges(a)
(2
)
(19
)
3
(14
)
Integration costs(b)
(9
)
(13
)
(34
)
(22
)
Mergers and acquisitions(c)
3
(1
)
(18
)
(14
)
Equity-based compensation(d)
(16
)
(2
)
(39
)
(3
)
Other adjustments, net(f)
(9
)
(13
)
(34
)
(21
)
Adjusted Operating Expenses
$
484
$
382
$
1,745
$
1,095
a)
Represents severance and related expenses
due to restructuring activities.
b)
Represents expenses related to the
integration of businesses acquired.
c)
Represents expenses related to business
acquisitions, including potential business acquisitions, and
includes pre-acquisition due diligence and related activities
costs. The full-year 2022 includes a charge of $19 million for a
loss contingency in relation to a contingent event that existed as
of the Egencia acquisition date.
d)
Represents non-cash equity-based
compensation expense related to equity incentive awards to certain
employees.
e)
Represents fair value movements on
earnouts and warrants derivative liabilities during the
periods.
f)
Adjusted Operating Expenses excludes (i)
long-term incentive plan expense of $8 million and $10 million for
the three months ended December 31, 2022 and 2021, respectively,
and $25 million and $15 million for the years ended December 31,
2022 and 2021, respectively, and (ii) litigation and professional
services costs of $1 million and $3 million for the three months
ended December 31, 2022 and 2021, respectively, and $9 million and
$6 million for the years ended December 31, 2022 and 2021,
respectively. Adjusted EBITDA additionally excludes (i) unrealized
foreign exchange losses (gains) of $(1) million and $(1) million
for the three months ended December 31, 2022 and 2021,
respectively, and $8 million and $0 for the years ended December
31, 2022 and 2021, respectively, (ii) non-service component of our
net periodic pension benefit related to our defined benefit pension
plans of $3 million and $3 million for the three months ended
December 31, 2022 and 2021, respectively, and $9 million and $9
million for the years ended December 31, 2022 and 2021,
respectively, and (iii) loss on disposal of business of $0 and $1
million for the three months ended December 31, 2022 and 2021,
respectively, and $0 million and $1 million for the years ended
December 31, 2022 and 2021, respectively.
Reconciliation of net cash used in operating activities to Free
Cash Flow:
Three Months Ended December
31,
Year Ended December
31,
($ in millions)
2022
2021
2022
2021
Net cash used in operating
activities
$
(4
)
$
(169
)
$
(394
)
$
(512
)
Less: Purchase of property and
equipment
(21
)
(16
)
(94
)
(44
)
Free Cash Flow
$
(25
)
$
(185
)
$
(488
)
$
(556
)
Reconciliation of Net Debt:
As of
($ in millions)
December 31, 2022
December 31, 2021
Senior Secured Credit Agreement
Principal amount of senior secured initial
term loans (Maturity – August 2025)(1)
$
239
$
242
Principal amount of senior secured tranche
B-3 term loans (Maturity – December 2026)(2)
1,000
800
1,239
1,042
Less: Unamortized debt discount and debt
issuance costs
(17
)
(19
)
Total debt, net of unamortized debt
discount and debt issuance costs
1,222
1,023
Less: Cash and cash equivalents
(303
)
(516
)
Net Debt
$
919
$
507
(1)
Stated interest rate of LIBOR + 2.50% as
of December 31, 2022 and December 31, 2021.
(2)
Stated interest rate of LIBOR + 6.50%
(with a LIBOR floor of 1.00%) as of December 31, 2022 and December
31, 2021.
Reconciliation of Revenue Recovery vs. Pro Forma 2019:
Three Months Ended December
31,
Three Months Ended September
30,
($ in millions)
2022
2019
2022
2019
Revenue
$
527
$
536
$
488
$
507
Egencia, Ovation & DER revenue
—
160
—
160
Foreign exchange at constant currency
—
10
—
13
Pro Forma Revenue
$
527
$
706
$
488
$
680
Revenue Recovery vs. Pro Forma 2019
75
%
72
%
Reconciliation of Pro Forma Revenue, Pro Forma Adjusted EBITDA
and Pro Forma Adjusted EBITDA Margin:
Three Months Ended December
31, 2022
Three Months Ended December
31, 2021
Amex GBT
Egencia
Pro Forma
Revenue
$
527
$
253
$
55
$
308
Net loss
(63
)
(173
)
(42
)
(215
)
Interest expense
29
16
—
16
Loss on early extinguishment of debt
—
49
—
49
Benefit from income taxes
(22
)
(50
)
(10
)
(60
)
Depreciation and amortization
48
43
11
54
Restructuring charges
2
19
—
19
Integration costs
9
13
—
13
Mergers and acquisitions
(3
)
1
—
1
Equity-based compensation
16
2
(1
)
1
Fair value movements on earnout and
warrants derivative liabilities
22
—
—
—
Other adjustments, net
5
11
9
20
Adjusted EBITDA
$
43
$
(69
)
$
(33
)
$
(102
)
Net loss margin
(12
%)
(70
%)
Adjusted EBITDA Margin
8
%
(33
%)
Year Ended December 31,
2022
Year Ended December 31,
2021
Amex GBT
Egencia
Pro Forma
Revenue
$
1,851
$
730
$
159
$
889
Net loss
(229
)
(448
)
(256
)
(704
)
Interest income
—
(1
)
—
(1
)
Interest expense
98
53
—
53
Loss on early extinguishment of debt
—
49
—
49
Benefit from income taxes
(61
)
(176
)
(19
)
(195
)
Depreciation and amortization
182
147
49
196
Restructuring charges
(3
)
14
9
23
Integration costs
34
22
—
22
Mergers and acquisitions
18
14
—
14
Equity-based compensation
39
3
—
3
Fair value movements on earnout and
warrants derivative liabilities
(8
)
—
1
1
Other adjustments, net
33
14
5
19
Adjusted EBITDA
$
103
$
(309
)
(211
)
$
(520
)
Net loss margin
(12
%)
(79
%)
Adjusted EBITDA Margin
6
%
(58
%)
Forward-Looking Statements
This communication contains statements that are forward-looking
and as such are not historical facts. This includes, without
limitation, statements regarding our financial position, business
strategy and the plans and objectives of management for future
operations. These statements constitute projections, forecasts and
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. The words “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “intend,”
“may,” “might,” “plan,” “possible,” “potential,” “predict,”
“project,” “should,” “will,” “would” and similar expressions may
identify forward-looking statements, but the absence of these words
does not mean that a statement is not forward-looking.
The forward-looking statements contained in this communication
are based on our current expectations and beliefs concerning future
developments and their potential effects on us. There can be no
assurance that future developments affecting us will be those that
we have anticipated. These forward-looking statements involve a
number of risks, uncertainties (some of which are beyond our
control) or other assumptions that may cause actual results or
performance to be materially different from those expressed or
implied by these forward-looking statements. These risks and
uncertainties include, but are not limited to, the following risks,
uncertainties and other factors: (1) changes to projected financial
information or our ability to achieve our anticipated growth rate
and execute on industry opportunities; (2) our ability to maintain
our existing relationships with customers and suppliers and to
compete with existing and new competitors; (3) various conflicts of
interest that could arise among us, affiliates and investors; (4)
our success in retaining or recruiting, or changes required in, our
officers, key employees or directors; (5) factors relating to our
business, operations and financial performance, including market
conditions and global and economic factors beyond our control; (6)
the impact of the COVID-19 pandemic, geopolitical conflicts and
related changes in base interest rates, inflation and significant
market volatility on our business, the travel industry, travel
trends and the global economy generally; (7) the sufficiency of our
cash, cash equivalents and investments to meet our liquidity needs;
(8) the effect of a prolonged or substantial decrease in global
travel on the global travel industry; (9) political, social and
macroeconomic conditions (including the widespread adoption of
teleconference and virtual meeting technologies which could reduce
the number of in-person business meetings and demand for travel and
our services); and (10) the effect of legal, tax and regulatory
changes, and (11) other risks and uncertainties described in the
Company’s Form 10-Q, filed with the SEC on November 10, 2022, and
in the Company’s other SEC filings. Should one or more of these
risks or uncertainties materialize, or should any of our
assumptions prove incorrect, actual results may vary in material
respects from those projected in these forward-looking statements.
We undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as may be required under applicable securities
laws.
Disclaimer
An investment in Global Business Travel Group, Inc. is not an
investment in American Express. American Express shall not be
responsible in any manner whatsoever for, and in respect of, the
statements herein, all of which are made solely by Global Business
Travel Group, Inc.
________________________________________ 1Adjusted EBITDA is a
non-GAAP financial measure. Please refer to the section below
titled “Non-GAAP Financial Measures” for more information. 2Pro
forma assumes Egencia, Ovation and DER acquisitions completed on
January 1, 2019, presented with a constant currency adjustment.
3Adjusted EBITDA Margin is a non-GAAP financial measure. Please
refer to the section below titled “Non-GAAP Financial Measures” for
more information. 4Free Cash Flow is a non-GAAP financial measure.
Please refer to the section below titled “Non-GAAP Financial
Measures” for more information. 5EBITDA is a non-GAAP financial
measure. Please refer to the section below titled “Non-GAAP
Financial Measures” for more information. 6Adjusted Operating
Expenses is a non-GAAP financial measure. Please refer to the
section below titled “Non-GAAP Financial Measures” for more
information. 7Results include Egencia, which was acquired on
November 1, 2021. 8Net Debt is a non-GAAP financial measure. Please
refer to the section below titled “Non-GAAP Financial Measures” for
more information.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230308005711/en/
Media: Martin Ferguson Vice President Global Communications and
Public Affairs, American Express Global Business Travel
martin.ferguson@amexgbt.com Investors: Barry Sievert Vice President
Investor Relations, American Express Global Business Travel
investor@amexgbt.com
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