Datalex third quarter revenues fall 19%

CONTINUED DIFFICULT conditions in the travel industry caused revenue at travel software firm Datalex to fall 19 per cent in the third quarter.

The company also revised its outlook to a loss of $3 million (€2 million) for the year.

In an interim statement issued yesterday, the Dublin-quoted group said the decline was mainly due to the reductions in customer spending on professional services, a trend it expected to continue into 2010.

“The difficult conditions experienced by the travel industry in the first half of 2009 show no signs of abating, with consumer demand still depressed and oil prices hovering around the $80 mark,” the statement said.

“In this environment, airlines are continuing to cut costs and defer capital investment until clear evidence emerges that the market outlook is improving.”

However, transaction revenue continued to grow, rising 22 per cent on the same quarter a year earlier, the firm said, and a 33 per cent increase year to date to $10.4 million compared to 2008.

The firm said two new contracts were in the pipeline, which it expects to have concluded before the end of this year for delivery in 2010.

Datalex trimmed costs by 10 per cent over the same period in 2008, and expects to save more than $7 million in 2010 as a result.

A dispute with the Flight Centre of Australia, in relation to the deployment of software at the business, is unlikely to be resolved this year, the company said.

“We are vigorously pursuing our claim for all monies owed, together with substantial damages for breach of contract,” Datalex said.