SINGAPORE and HAINAN, China - In a strategic move to bolster its international presence, Hainan Airlines has entered into a long-term agreement with Sabre (NASDAQ:SABR) Corporation (NASDAQ: SABR), a leading technology provider in the global travel industry with annual revenues of $3 billion and a market capitalization of $1.3 billion. The collaboration is set to enhance the Chinese airline's fare management capabilities for its international routes. According to InvestingPro data, Sabre demonstrates strong operational efficiency with impressive gross profit margins of 59.26%.
Hainan Airlines, a recipient of the SKYTRAX 5-Star Airline rating for over a decade, is working on expanding its global network. The partnership with Sabre is expected to support this growth by implementing Sabre's Fares Manager and Contract Manager solutions. These tools will enable the airline to dynamically monitor and adjust international fares, which is vital for maintaining competitive pricing and maximizing revenue.
Zhu Li, General Manager of the International Department at Hainan Airlines Marketing Committee, emphasized the importance of this alliance. "As we resume and introduce new routes, it is essential to have an appropriate fare structure across our network," said Zhu. He expressed confidence that Sabre's technology would support the airline's growth strategy and commitment to delivering competitive value to passengers worldwide.
Sabre's Vice President, Rakesh Narayanan, also commented on the agreement, highlighting the enhanced agility and precision it will bring to Hainan Airlines' fare structuring efforts.
Hainan Airlines, established in 1993, has recently expanded its fleet and route network. The airline, which operates over 1,400 domestic and international routes, aims to build a world-class network in alignment with China's Belt and Road Initiative.
The airline's focus on safety and service quality has been recognized with numerous awards, including the "One Star Flight Safety Diamond Award" from the Civil Aviation Administration of China and the consistent SKYTRAX 5-Star rating since 2011.
Sabre Corporation, headquartered in Southlake, Texas, serves customers in over 160 countries, providing innovative products and technology solutions to connect suppliers and buyers in the travel industry.
This new agreement with Hainan Airlines underscores Sabre's commitment to driving innovation and success through its technology offerings. The partnership is based on a press release statement and aims to facilitate Hainan Airlines' continued growth in the international aviation market.
In other recent news, Amadeus (BME:AMA) IT Group has maintained a Market Perform rating by Bernstein analysts, who highlighted the company's strong market position and substantial investment in research and development. On the other hand, Bernstein downgraded Sabre Corporation's stock from Market Perform to Underperform, citing concerns about the company's heavy reliance on the slowing Global Distribution System business and the challenges posed by rapid technological changes in North America.
In recent developments, Sabre Corp reported a 3% year-over-year revenue growth, reaching $765 million in Q3 2024, and has made significant strides in financial restructuring through new secured notes and term loan amendments. Despite a downgrade in stock rating, Sabre maintains a positive outlook, focusing on strategic investments and cost management, with projections for Q4 2024 including an anticipated revenue of approximately $715 million and adjusted EBITDA of around $115 million.
Moreover, Sabre aims to achieve over $700 million in adjusted EBITDA and more than $200 million in free cash flow by 2025. While Bernstein remains cautious about Sabre's financial health, the company's Q3 earnings call revealed a 19% increase in Adjusted EBITDA from the previous year. These are the recent developments in both companies.
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