Southwest still profitable, others soon
The travel industry has rebounded since the drastic slow down after 9-11, but hefty fuel prices has affected the bottom line of many in the airline industry. Southwest Airlines Co. is famous for running a tight ship and, yesterday, reported $86 million in profit, while, across town, American Airlines, an AMR Corp. company, reported a loss of $604 million.
Despite the loss, AMR Corp. should do much better year, thanks to cost cutting measures enacted in 2005. Many analysts expect AMR Corp., AirTran (NYSE: AAI), Continental Airlines Inc. (NYSE: CAL), and JetBlue (NASDAQ: JBLU) to join Southwest in the ranks of profitable carriers this year.
The increasing strength in the travel industry bodes well for Onelink4travel, Inc. (OTCBB: OLKT), which should be nearing the end of a 30 day trial run, it initiated, of its booking and settlement system with PNR Travel, signifying one of the final steps before widespread roll-out of its core transaction processing system, meaning it’s probable that it will not be available at this level much longer.
Onelink4travel also said that it, “is in discussions to add its service to other industry portals in the future, and anticipates making announcements in this regard in coming weeks.” OneLink already has agreements with key suppliers including Sabre Travel Network, PayPal, Hotels.com and Amadeus Global Travel Distribution, but PNR Travel will be the first agency to access the service, as a benefit of its membership in Computerized Corporate Rate Association, a Preferred Rate Hotel Program.
Robert E. Kern, Jr., President of PNR Travel, said, “PNR Travel strongly believes that a true retail business model is essential for the future success of the travel agency community. Onelink4travel’s system supports this concept by putting the agent in control of the customer transaction.
By doing so it not only strengthens an agency’s business position, but also improves its perceived value in the eyes of the customer.
PNR Travel is excited to be the first agency to benefit from the Onelink4travel system, and looks forward to the company’s larger success.”
Onelink4travel’s GDS is focused on the multi-billion dollar non-airline travel industry and pending successful completion of its software test, will begin introducing the service in late December to U.S. based travel agents who are members of the company’s CCRA International hotel marketing program, followed by a full-scale launch to Onelink4travel’s 100,000 travel agent members, most of which are based in North America, scheduled to begin in January.
If OneLink starts trading at typical industry multiples it could shoot straight up because starting fiscal year 2006 the company forecasts total revenues to hit between $42 million and $48 million for 2006, giving it an estimated operating income, 2006, of $11.5 million to $13 million, or $0.37 to $0.42 per share.
Thereafter, OneLink believes it can achieve revenues in the $250 million range, if it’s able to hit 5% market penetration for its unique proprietary product.
The OneLink GDS system is designed to interface with the prominent air travel computerized reservation systems, including Sabre, Galileo, Apollo, Worldspan and Amadeus.