Amex GBT Notes Corp. Travel ‘Resilience’ in Omicron Recovery

American Express Global Business Travel’s transaction volume in February climbed back to more than half of its pre-pandemic level as part of a “strong recovery” from the Covid-19 omicron variant, the travel management company reported.

In advance of its plans to go public later this year, Amex GBT reported 2021 financial results on Monday, showing total transaction value of $6.8 billion for the year, up 14 percent compared with 2020. Travel revenue in 2021 was down 5 percent year over year to $446 million, and product and professional services revenue declined 2 percent year over year to $317 million. 

Total transaction volume in 2020 had declined 71 percent year over year, but Amex GBT CFO Martine Gerow noted yield was higher in 2020, which benefited from pre-pandemic-level travel at the beginning of the year in addition to servicing charges from the cancellations that followed as the pandemic began.

In the fourth quarter, which included figures after Amex GBT completed its acquisition of Egencia, total transaction value was up 488 percent year over year to $2.8 billion, with travel revenue up 244 percent and product and professional services revenue up 31 percent. Amex GBT CEO Paul Abbott in an earnings call said the TMC ended the year “on a high note” despite the emergence of the omicron variant, which hurt volume in December and January

“Corporate travel volumes have shown a lot more resilience and a much faster recovery rate from the omicron wave, as governments and businesses have adopted a more pragmatic response that recognizes the transition to the more endemic state,” Abbott said. “We actually passed the omicron volume trough in mid-January, only about four to six weeks after the initial outbreak.”

In the last week of February, transaction volumes were at 51 percent of 2019 levels, and total transaction value was at 45 percent of 2019 levels, he added.

Amex GBT also has seen growing demand for meetings and events as corporations around the world reopen offices, Abbott said. As of the beginning of March, forward bookings for meetings and events were at 63 percent of 2019 levels, he said.

The TMC reported a customer retention rate of 95 percent in 2021, which Abbott said was higher than pre-pandemic levels. He listed Hewlett Packard Enterprise, Standard Chartered and Palo Alto Networks as “notable [client] wins” last year, as well as Raytheon Technologies and Ferrero Group this year.

Amex GBT reported a net loss of $474 million in 2021, an improvement from a net loss of $619 million in 2020.