Datalex reports decline in revenue as CFO to step down

Irish travel retail software company records 5% fall in first-half revenue to $12.6m

Datalex chief executive Sean Corkery, pictured at a company agm. Photograph: Tom Honan

Datalex chief executive Sean Corkery, pictured at a company agm. Photograph: Tom Honan

 

Datalex, the travel retail software provider to airlines in which businessman Dermot Desmond is a major shareholder, has reported a decline in first-half revenue as the Covid crisis continues to impact the sector.

The news comes as the company announced its chief financial officer of two years, Niall O’Sullivan, will leave the company at the end of the December and that he has stepped down as a director with immediate effect. A process to appoint a successor is under way, Datalex said.

Datalex reported a 5 per cent decline in first-half revenue to $12.6 million (€10.6 million), as against $13.2 million a year earlier. Platform revenues were 3 per cent lower at $7.5 million.

The company reported adjusted earnings before interest, taxes, depreciation and amortisation (ebitda) of $1.8 million for the period compared with a $1.3 million loss a year earlier.

Operating costs

Total operating costs before exceptional items fell 22 per cent to $12.2 million, which included a $1.5 million supplier discount.

“The recovery from the impact of Covid-19 on the airline industry will take time and airlines continue to operate in a Covid-centric backdrop, which has caused them to delay and extend IT and digital investment decisions,” chief executive Sean Corkery said.

“However, we have experienced a considerable increase in sales pipeline activity in the second quarter of 2021, as airlines began to reconsider investment in their retailing technology as part of their recovery strategies,” he added.

Commenting on the departure of Mr O’Sullivan, Mr Corkery said he had been “instrumental in providing financial leadership through a period of significant change and transformation at the company”.

Mr Corkery said Dalalex has recently contracted with a customer for the latest version of its NDC product and for them to participate in a dynamic pricing production trial. It has also agreed a contract with a tier-one airline to complete a similar trial.

Datalex was forced to accept an additional €10 million credit line from its main shareholder Dermot Desmond last year on top of €11.3 million of expensive emergency loans he had given the company in 2019 to keep the company solvent during the coronavirus pandemic.