in the section captioned “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2017, filed with the U.S. Securities and Exchange Commission (the “SEC”) on February ~~21, 2017,~~20, 2018, as well as any other cautionary language in this Quarterly Report on Form 10-Q, provide examples of risks, uncertainties and events that may cause actual results to differ materially from the expectations described in the forward-looking statements. You should be aware that the occurrence of the events described in these risk factors and elsewhere in this report could have an adverse effect on our business, results of operations, financial position and cash flows.

Forward-looking statements speak only as of the date the statements are made. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect thereto or with respect to other forward-looking statements. For any forward-looking statements contained in any document, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

PART I—FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS (UNAUDITED)

TRAVELPORT WORLDWIDE LIMITED

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(unaudited)

(in $ thousands, except share data)
Three Months
Ended
March 31,
2017

Three Months
Ended
March 31,
2016

Net revenue $ 650,763 $ 609,263
Costs and expenses
Cost of revenue 386,837 362,677
Selling, general and administrative 112,147 114,477
Depreciation and amortization 52,909 52,241
Total costs and expenses 551,893 529,395
Operating income 98,870 79,868
Interest expense, net (30,275) (54,895)
Income before income taxes 68,595 24,973
Provision for income taxes (12,732) (7,792)
Net income 55,863 17,181
Net loss (income) attributable to non-controlling interest in subsidiaries 243 (596)
Net income attributable to the Company $ 56,106 $ 16,585
Income per share – Basic:
Income per share $ 0.45 $ 0.13
Weighted average common shares outstanding – Basic 124,081,175 123,718,311
Income per share – Diluted:
Income per share $ 0.45 $ 0.13
Weighted average common shares outstanding – Diluted 125,516,945 123,778,407
Cash dividends declared per common share $ 0.075 $ 0.075

	Three Months			Three Months
	Ended			Ended
	March 31,			March 31,
(in $ thousands, except share data)	2018			2017
Net revenue	$	677,838		$	650,763
Costs and expenses
Cost of revenue		426,397			386,837
Selling, general and administrative		125,200			111,301
Depreciation and amortization		48,577			52,909
Total costs and expenses		600,174			551,047
Operating income		77,664			99,716
Interest expense, net		(14,935	)		(30,275	)
Loss on early extinguishment of debt		(27,661	)		—
Other expense		(93	)		(846	)
Income before income taxes		34,975			68,595
Provision for income taxes		(3,491	)		(12,732	)
Net income from continuing operations		31,484			55,863
Income from discontinued operations, net of tax		27,747			—
Net income		59,231			55,863
Net (income) loss attributable to non-controlling interest in subsidiaries		(402	)		243
Net income attributable to the Company	$	58,829		$	56,106
Income per share – Basic:
Income per share – continuing operations	$	0.25		$	0.45
Income per share – discontinued operations		0.22			—
Basic income per share	$	0.47		$	0.45

Weighted average common shares outstanding – Basic		125,428,257			124,081,175
Income per share – Diluted:
Income per share – continuing operations	$	0.25		$	0.45
Income per share – discontinued operations		0.22			—
Diluted income per share	$	0.47		$	0.45

Weighted average common shares outstanding – Diluted		126,131,201			125,516,945

Cash dividends declared per common share	$	0.075		$	0.075

See Notes to the Consolidated Condensed Financial Statements

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited)

(in $ thousands)
Three Months
Ended
March 31,
2017

Three Months
Ended
March 31,
2016

Net income $ 55,863 $ 17,181
Other comprehensive income, net of tax
Currency translation adjustment, net of tax 4,337 7,459
Amortization of actuarial loss to net income, net of tax 2,599 2,251
Other comprehensive income, net of tax 6,936 9,710
Comprehensive income 62,799 26,891
Comprehensive loss (income) attributable to non-controlling interest in subsidiaries 243 (596)
Comprehensive income attributable to the Company $ 63,042 $ 26,295

	Three Months			Three Months
	Ended			Ended
	March 31,			March 31,
(in $ thousands)	2018			2017
Net income	$	59,231		$	55,863
Other comprehensive income, net of tax
Currency translation adjustment, net of tax		4,270			4,337
Amortization of actuarial loss to net income, net of tax		2,473			2,599
Other comprehensive income, net of tax		6,743			6,936
Comprehensive income		65,974			62,799
Comprehensive (income) loss attributable to non-controlling interest in subsidiaries		(402	)		243
Comprehensive income attributable to the Company	$	65,572		$	63,042

See Notes to the Consolidated Condensed Financial Statements

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

CONSOLIDATED CONDENSED BALANCE SHEETS

(unaudited)

(in $ thousands, except share data)
March 31,
2017

December 31,
2016

Assets
Current assets:
Cash and cash equivalents $ 187,407 $ 139,938
Accounts receivable (net of allowances for doubtful accounts of $12,720 and $13,430) 267,785 218,224
Other current assets 99,286 84,089
Total current assets 554,478 442,251
Property and equipment, net 414,639 431,046
Goodwill 1,082,315 1,079,951
Trademarks and tradenames 313,097 313,097
Other intangible assets, net 510,750 511,607
Deferred income taxes 9,366 9,213
Other non-current assets 48,460 46,764
Total assets $ 2,933,105 $ 2,833,929
Liabilities and equity
Current liabilities:
Accounts payable $ 62,347 $ 59,219
Accrued expenses and other current liabilities 527,862 478,560
Current portion of long-term debt 62,441 63,558
Total current liabilities 652,650 601,337
Long-term debt 2,270,788 2,281,210
Deferred income taxes 59,433 59,381
Other non-current liabilities 225,049 227,783
Total liabilities 3,207,920 3,169,711
Commitments and contingencies (Note 11)
Shareholders’ equity (deficit):
Preference shares ($0.0025 par value; 225,000,000 shares authorized; no shares issued and outstanding as of March 31, 2017 and December 31, 2016) — —
Common shares ($0.0025 par value; 560,000,000 shares authorized;
125,000,621 shares and 124,941,233 shares issued; 124,082,833
shares and 124,032,361 shares outstanding as of March 31, 2017
and December 31, 2016, respectively) 312 312
Additional paid in capital 2,705,950 2,708,836
Treasury shares, at cost (917,788 shares and 908,872 shares as of March 31, 2017 and December 31, 2016, respectively) (14,294) (14,166)
Accumulated deficit (2,808,732) (2,864,838)
Accumulated other comprehensive loss (183,136) (190,072)
Total shareholders’ equity (deficit) (299,900) (359,928)
Equity attributable to non-controlling interest in subsidiaries 25,085 24,146
Total equity (deficit) (274,815) (335,782)
Total liabilities and equity $ 2,933,105 $ 2,833,929

	March 31,			December 31,
(in $ thousands, except share data)	2018			2017
Assets
Current assets:
Cash and cash equivalents	$	127,165		$	122,039
Accounts receivable (net of allowances for doubtful accounts of $9,566 and $10,245, respectively)		270,663			206,524
Other current assets		142,526			109,724
Total current assets		540,354			438,287
Property and equipment, net		435,354			431,741
Goodwill		1,090,515			1,089,590
Trademarks and tradenames		313,097			313,097
Other intangible assets, net		509,700			496,180
Deferred income taxes		22,864			12,796
Other non-current assets		77,358			76,808
Total assets	$	2,989,242		$	2,858,499
Liabilities and equity
Current liabilities:
Accounts payable	$	80,147		$	73,278
Accrued expenses and other current liabilities		576,770			509,068
Current portion of long-term debt		54,089			64,291
Total current liabilities		711,006			646,637
Long-term debt		2,169,035			2,165,722
Deferred income taxes		35,307			34,899
Other non-current liabilities		200,890			203,562
Total liabilities		3,116,238			3,050,820
Commitments and contingencies (Note 13)
Shareholders’ equity (deficit):
Preference shares ($0.0025 par value; 225,000,000 shares authorized; no shares issued and outstanding as of March 31, 2018 and December 31, 2017)		—			—
Common shares ($0.0025 par value; 560,000,000 shares authorized; 127,260,153 shares and 126,967,010 shares issued; 125,630,319 shares and 125,346,613 shares outstanding as of March 31, 2018 and December 31, 2017, respectively)		318			317
Additional paid in capital		2,695,766			2,700,133
Treasury shares, at cost 1,629,834 shares and 1,620,397 shares as of March 31, 2018 and December 31, 2017, respectively)		(24,867	)		(24,755	)
Accumulated deficit		(2,662,560	)		(2,722,375	)
Accumulated other comprehensive loss		(148,878	)		(155,621	)
Total shareholders’ equity (deficit)		(140,221	)		(202,301	)
Equity attributable to non-controlling interest in subsidiaries		13,225			9,980
Total equity (deficit)		(126,996	)		(192,321	)
Total liabilities and equity	$	2,989,242		$	2,858,499

See Notes to the Consolidated Condensed Financial Statements

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(unaudited)

(in $ thousands)
Three Months
Ended
March 31,
2017

Three Months
Ended
March 31,
2016

Operating activities
Net income $ 55,863 $ 17,181
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 52,909 52,241
Amortization of customer loyalty payments 18,795 16,574
Impairment of long-lived assets 685 461
Amortization of debt finance costs and debt discount 2,673 2,571
Gain on foreign exchange derivative instruments (7,701) (11,074)
(Gain) loss on interest rate derivative instruments (226) 16,456
Equity-based compensation 8,006 9,117
Deferred income taxes 152 (887)
Customer loyalty payments (16,755) (25,307)
Pension liability contribution (595) (1,118)
Changes in assets and liabilities:
Accounts receivable (49,198) (49,424)
Other current assets (4,075) (23,251)
Accounts payable, accrued expenses and other current liabilities 37,449 27,232
Other (2,960) (4,568)
Net cash provided by operating activities $ 95,022 $ 26,204
Investing activities
Property and equipment additions $ (23,609) $ (22,521)
Net cash used in investing activities $ (23,609) $ (22,521)

	Three Months			Three Months
	Ended			Ended
	March 31,			March 31,
(in $ thousands)	2018			2017
Operating activities
Net income	$	59,231		$	55,863
Income from discontinued operations, net of tax		(27,747	)		—
Net income from continuing operations		31,484			55,863
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities:
Depreciation and amortization		48,577			52,909
Amortization of customer loyalty payments		22,343			18,795
Impairment of long-lived assets		491			685
Amortization of debt finance costs and debt discount		1,890			2,673
Loss on early extinguishment of debt		27,661			—
Unrealized loss (gain) on foreign exchange derivative instruments		242			(7,701	)
Unrealized gain on interest rate derivative instruments		(10,430	)		(226	)
Equity-based compensation		5,056			8,006
Deferred income taxes		(9,836	)		152
Customer loyalty payments		(27,366	)		(16,755	)
Pension liability contribution		(338	)		(595	)
Changes in assets and liabilities:
Accounts receivable		(62,768	)		(49,198	)
Other current assets		(8,057	)		(4,075	)
Accounts payable, accrued expenses and other current liabilities		53,750			37,449
Other		10,398			(2,960	)
Net cash provided by operating activities of continuing operations	$	83,097		$	95,022
Investing activities
Property and equipment additions	$	(36,663	)	$	(23,609	)
Net cash used in investing activities	$	(36,663	)	$	(23,609	)

See Notes to the Consolidated Condensed Financial Statements

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS—(Continued)

(unaudited)

(in $ thousands)
Three Months
Ended
March 31,
2017

Three Months
Ended
March 31,
2016

Financing activities
Repayment of term loans $ (5,938) $ (9,405)
Repayment of capital lease obligations and other indebtedness (9,511) (12,079)
Proceeds from revolver borrowings — 10,000
Repayment of revolver borrowings — (10,000)
Dividend to shareholders (9,306) (9,280)
Proceeds from share issuance under employee share purchase plan 632 —
Treasury share purchase related to vesting of equity awards (128) (275)
Net cash used in financing activities $ (24,251) $ (31,039)
Effect of changes in exchange rates on cash and cash equivalents 307 508
Net increase (decrease) in cash and cash equivalents 47,469 (26,848)
Cash and cash equivalents at beginning of period 139,938 154,841
Cash and cash equivalents at end of period $ 187,407 $ 127,993
Supplemental disclosures of cash flow information
Interest payments, net of capitalized interest $ 30,126 $ 37,480
Income tax payments, net of refunds 3,905 4,549
Non-cash capital lease additions 1,651 6,779

	Three Months			Three Months
	Ended			Ended
	March 31,			March 31,
(in $ thousands)	2018			2017
Financing activities
Proceeds from term loans	$	1,400,000		$	—
Proceeds from issuance of senior secured notes		745,000			—
Repayment of term loans		(2,153,750	)		(5,938	)
Repayment of capital lease obligations and other indebtedness		(8,000	)		(9,511	)
Debt finance costs and lender fees		(17,381	)		—
Dividend to shareholders		(9,427	)		(9,306	)
Proceeds from share issuance under employee share purchase plan and stock options		2,088			632
Treasury share purchase related to vesting of equity awards		(235	)		(128	)
Net cash used in financing activities	$	(41,705	)	$	(24,251	)
Effect of changes in exchange rates on cash and cash equivalents		397			307
Net increase in cash and cash equivalents		5,126			47,469
Cash and cash equivalents at beginning of period		122,039			139,938
Cash and cash equivalents at end of period	$	127,165		$	187,407
Supplemental disclosures of cash flow information
Interest payments, net of capitalized interest	$	31,530		$	30,126
Income tax payments, net of refunds		11,902			3,905
Non-cash capital lease additions		2,164			1,651
Non-cash purchase of property and equipment		4,220			—

See Notes to the Consolidated Condensed Financial Statements

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN TOTAL EQUITY (DEFICIT)

(unaudited)

Common Shares Additional
Paid in
Capital Treasury Shares Accumulated
Deficit Accumulated
Other
Comprehensive
Loss Non-
Controlling
Interest in
Subsidiaries Total
Equity
(Deficit)
(in $ thousands, except share data) Number Amount Number Amount
Balance as of December 31, 2016 124,941,233 $ 312 $ 2,708,836 908,872 $ (14,166) $ (2,864,838) $ (190,072) $ 24,146 $ (335,782)
Dividend to shareholders ($0.075 per common share) — — (10,054) — — — — — (10,054)
Equity-based compensation 59,388 — 7,168 — — — — 1,182 8,350
Treasury shares purchased in relation to vesting of equity awards — — — 8,916 (128) — — — (128)
Comprehensive income (loss), net of tax — — — — — 56,106 6,936 (243) 62,799
Balance as of March 31, 2017 125,000,621 $ 312 $ 2,705,950 917,788 $ (14,294) $ (2,808,732) $ (183,136) $ 25,085 $ (274,815)

Common Shares Additional
Paid in
Capital Treasury Shares Accumulated
Deficit Accumulated
Other
Comprehensive
Loss Non-
Controlling
Interest in
Subsidiaries Total
Equity
(Deficit)
(in $ thousands, except share data) Number Amount Number Amount
Balance as of December 31, 2015 124,476,382 $ 311 $ 2,715,538 844,908 $ (13,331) $ (2,881,658) $ (177,507) $ 33,789 $ (322,858)
Dividend to shareholders ($0.075 per common share) — — (9,458) — — — — — (9,458)
Equity-based compensation 111,412 — 9,026 — — — — — 9,026
Treasury shares purchased in relation to vesting of equity awards — — — 23,417 (275) — — — (275)
Comprehensive income, net of tax — — — — — 16,585 9,710 596 26,891
Balance as of March 31, 2016 124,587,794 $ 311 $ 2,715,106 868,325 $ (13,606) $ (2,865,073) $ (167,797) $ 34,385 $ (296,674)

																	Accumulated			Non-
					Additional												Other			Controlling		Total
	Common Shares				Paid in			Treasury Shares						Accumulated			Comprehensive			Interest in		Equity
(in $ thousands, except share data)	Number		Amount		Capital			Number			Amount			Deficit			Loss			Subsidiaries		(Deficit)
Balance as of December 31, 2017		126,967,010	$	317	$	2,700,133			1,620,397		$	(24,755	)	$	(2,722,375	)	$	(155,621	)	$	9,980	$	(192,321	)
Change in accounting policy for revenue recognition (see Note 3)		—		—		—			—			—			986			—			—		986
Dividend to shareholders ($0.075 per common share)		—		—		(9,699	)		—			—			—			—			—		(9,699	)
Equity-based compensation		293,143		1		7,342			—			—			—			—			956		8,299
Purchase of a non-controlling interest in a subsidiary		—		—		(1,887	)		—			—			—			—			1,887		—
Treasury shares purchased in relation to vesting of equity awards		—		—		—			17,445			(235	)		—			—			—		(235	)
Treasury shares issued in relation to vesting of equity awards		—		—		(123	)		(8,008	)		123			—			—			—		—
Comprehensive income, net of tax		—		—		—			—			—			58,829			6,743			402		65,974
Balance as of March 31, 2018		127,260,153	$	318	$	2,695,766			1,629,834		$	(24,867	)	$	(2,662,560	)	$	(148,878	)	$	13,225	$	(126,996	)

																Accumulated			Non-
					Additional											Other			Controlling			Total
	Common Shares				Paid in			Treasury Shares					Accumulated			Comprehensive			Interest in			Equity
(in $ thousands, except share data)	Number		Amount		Capital			Number		Amount			Deficit			Loss			Subsidiaries			(Deficit)
Balance as of December 31, 2016		124,941,233	$	312	$	2,708,836			908,872	$	(14,166	)	$	(2,864,838	)	$	(190,072	)	$	24,146		$	(335,782	)
Dividend to shareholders ($0.075 per common share)		—		—		(10,054	)		—		—			—			—			—			(10,054	)
Equity-based compensation		59,388		—		7,168			—		—			—			—			1,182			8,350
Treasury shares purchased in relation to vesting of equity awards		—		—		—			8,916		(128	)		—			—			—			(128	)
Comprehensive income (loss), net of tax		—		—		—			—		—			56,106			6,936			(243	)		62,799
Balance as of March 31, 2017		125,000,621	$	312	$	2,705,950			917,788	$	(14,294	)	$	(2,808,732	)	$	(183,136	)	$	25,085		$	(274,815	)

See Notes to the Consolidated Condensed Financial Statements

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

1. Basis of Presentation

Basis of Presentation

Travelport Worldwide Limited (the “Company” or “Travelport”) is a travel commerce platform providing distribution, technology, payment, mobile and other solutions for the global travel and tourism industry. With a presence in approximately 180 countries and territories, Travelport business is comprised of:

The Travel Commerce Platform, through which the Company facilitates travel commerce by connecting the world’s leading travel providers, such as airlines, ~~and~~ hotel chains and car rental companies, with online and offline travel buyers in the Company’s proprietary business-to-business (“B2B”) travel ~~commerce~~ platform. As ~~travel industry~~customer needs and technologies evolve, Travelport ~~is utilizing~~continues to invest in its Travel Commerce ~~Platform to redefine the~~Platform. Travelport has led innovation in electronic distribution and merchandising of airline core and ancillary products ~~as well as extending~~and extensively divested its ~~reach into the growing world of travel commerce beyond air, including~~offerings to hotel, car rental, rail, cruise-line and tour operators. In addition, Travelport has leveraged its domain expertise in the travel industry to design a pioneering B2B payment solution that addresses the need of travel agencies to efficiently and securely make payments to travel providers globally. The Company also ~~provides travel companies with~~has a strong focus on mobile ~~travel platform and digital product set~~commerce, providing a wide range of services that allows airlines, hotels, corporate travel management companies and travel agencies to engage with their customers through digital services, including apps, ~~mobile web~~corporate booking tools and mobile messaging. Travelport utilizes the extensive data managed by its platform to provide an array of additional services, such as advertising solutions, subscription services, business intelligence data services, and marketing-oriented analytical tools to travel agencies, travel providers and other travel data users.

Through its Technology Services, Travelport provides critical hosting ~~solutions~~services to airlines, such as ~~pricing,~~ shopping, ticketing, ~~ground handling~~departure control, business intelligence and other solutions, enabling them to focus on their core business competencies and reduce costs. The Company hosts reservations, inventory management and other related critical systems for Delta Air Lines Inc.

The Company has two operating segments, Travelport and eNett; however, the Company reports them together as one reportable segment as eNett does not meet the ~~thresholds~~criteria for a separate reportable segment.

These consolidated condensed financial statements and other consolidated condensed financial information included in this Quarterly Report on Form 10-Q are unaudited, with the exception of the December 31, ~~2016~~2017 consolidated condensed balance sheet, which was derived from audited consolidated financial statements. These consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim reporting. Certain disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations.

In presenting the consolidated condensed financial statements in accordance with U.S. GAAP, management makes estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgments and available information. Accordingly, actual results could differ from those estimates. In management’s opinion, the consolidated condensed financial statements contain all normal recurring adjustments necessary for a fair presentation of interim results reported. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These consolidated condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~2017 filed with the SEC on February ~~21, 2017.~~20, 2018.

The Company has reclassified prior period information as a result of the Company's adoption of new guidance on pensions as further described in Note 2–Recently Issued Accounting Pronouncements.

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

2. Recently Issued Accounting Pronouncements

~~Pension~~

Accounting Pronouncements Adopted

Equity-Based Compensation—Modification Accounting

In ~~March~~May 2017, the Financial Accounting Standards Board (the “FASB”) issued guidance clarifying when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This guidance does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the value, vesting conditions or award classification and will not be required if the changes are considered non-substantive. The Company adopted the provisions of this guidance prospectively effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements.

Pension

In March 2017, the FASB issued guidance on the presentation of net periodic pension cost and post-retirement benefit cost (“net benefit cost”). The new

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~2. Recently Issued Accounting Pronouncements (Continued)~~

guidance requires ~~the Company to present~~ the service cost component of net benefit cost to be presented as part of the other employee compensation costs in operating income, which can be further considered for capitalization as part of the capitalization policy, and to present the other components of net benefit cost, including interest costs, expected return on plan assets and amortization of actuarial gain or loss (the “other components”) separately, in one or more line items, outside of operating income. Further, the new guidance requires a ~~company to disclose in the footnotes to the financial statements~~disclosure of the line items that contain the other components of net benefit cost in the footnotes to the financial statements if they are not presented on appropriately described separate lines in the statement of operations. The ~~new~~Company adopted the provisions of this guidance ~~is applicable~~effective January 1, 2018, as required under the guidance, and reclassified $1 million related to the ~~Company~~other components from selling, general and administrative expense to other expense within the consolidated condensed statements of operations for interim and annual reporting periods beginning after December 15, 2017 using a retrospective transition method (except for capitalization of service cost, which has to be applied on a prospective basis). Earlythe three months ended March 31, 2017. The adoption of ~~the amendments in the~~this guidance ~~is permitted only in the first quarter of 2017. The Company does not anticipate any significant~~had no impact on the Company’s net income, consolidated condensed ~~financial~~balance sheets or statements ~~resulting from the adoption~~ of ~~this guidance.~~

cash flows.

Goodwill Impairment

In January 2017, the FASB issued guidance to simplify the accounting for goodwill impairment. The guidance removes step two of the goodwill impairment test, which requires a hypothetical purchase price allocation. AUnder this guidance a goodwill impairment ~~will be~~is the amount by which a reporting unit’s carrying value exceeds its fair value. The new guidance is applicable ~~to the Company~~ for interim and annual reporting periods beginning after December 15, 2019. Early adoption of the amendments in the guidance is permitted for any impairment tests performed after January 1, 2017 and requires its application using a prospective transition method. The Company ~~does~~early adopted the provisions of this guidance effective January 1, 2018. The adoption of this guidance did not ~~anticipate any significant~~have an impact on the Company’s consolidated condensed financial ~~statements resulting from the adoption of this guidance.~~

statements.

Restricted Cash

In November 2016, the FASB issued guidance that requires entities to include restricted cash as part of cash and cash equivalents in the statement of cash flows. It also requires a reconciliation ~~between~~of cash, cash equivalents and restricted cash balances disclosed in the balance sheet ~~and~~with the corresponding amounts as shown in the statement of cash flows. The ~~new~~Company adopted the provisions of this guidance ~~is applicable to~~effective January 1, 2018 as required under the ~~Company for interim and annual reporting periods beginning after December 15, 2017. Early~~guidance. The adoption of ~~the amendments in the~~this guidance ~~is permitted and requires its application using a retrospective transition method. The Company does~~did not ~~anticipate any significant~~have an impact on the Company’s consolidated condensed financial ~~statements resulting from the adoption of this guidance.~~

statements.

Statement of Cash Flows

In August 2016, the FASB issued guidance on the classification of certain cash receipts and cash payments in the statement of cash flows. The amendments provide specific guidance relating to the classification of certain items, including cash payments for debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, distributions received from equity method investments and cash flows classification based on its predominate source or use. The ~~new~~Company adopted the provisions of this guidance ~~is applicable to~~effective January 1, 2018 as required under the ~~Company for interim and annual reporting periods beginning after December 15, 2017. Early~~guidance. The adoption of this guidance did not have an impact on the ~~amendments~~Company’s consolidated condensed financial statements.

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

Financial Instruments

In January 2016, the FASB issued guidance that amends the current guidance on the classification and measurement of financial instruments. It significantly revises the accounting related to (i) the classification and measurement of investments in equity securities of unconsolidated subsidiaries (other than those accounted for using the equity method of accounting) and (ii) the presentation of certain fair value changes for financial liabilities measured at fair value. The guidance also amends certain disclosure requirements associated with the fair value of financial instruments. The Company adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not have an impact on the Company’s consolidated condensed financial statements.

Revenue Recognition

In May 2014, the FASB issued guidance on revenue from contracts with customers that superseded most current revenue recognition guidance, including industry-specific guidance. The underlying principle of the guidance is ~~permitted~~to recognize revenue to depict the transfer of goods or services to customers at an amount to which the company expects to be entitled in exchange for those goods or services. The new guidance requires an evaluation of revenue arrangements with customers following a five-step approach: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) the company satisfies each performance obligation. Revenues are recognized when control of the promised services are transferred to the customers in an amount that reflects the expected consideration in exchange for those services. A customer obtains control when it has the ability to direct the use of and obtain the benefits from the services. Other major provisions of the guidance include capitalization of certain contract costs, consideration of the time value of money in the transaction price and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires ~~its application using a retrospective transition method.~~enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company ~~does~~adopted the provisions of this guidance effective January 1, 2018 as required under the guidance. The adoption of this guidance did not ~~anticipate~~have any ~~significant~~material impact on the Company’s consolidated condensed financial statements ~~resulting from the adoption of this guidance.~~

(see Note 3 – Revenue).

Accounting Pronouncements Not Yet Adopted

Financial Instruments—Credit Losses

In June 2016, the FASB issued guidance that amends the ~~guidance on~~ accounting for credit losses on financial instruments. The guidance adds an impairment model that is based on expected losses rather than incurred losses. Under this new guidance, ~~an entity will recognize an~~ allowance for credit losses will be recognized based on ~~its~~

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~2. Recently Issued Accounting Pronouncements (Continued)~~

the estimate of expected credit losses, which will result in more timely recognition of such losses. The guidance requires ~~an entity to consider~~ all available relevant information to be considered when estimating expected credit losses, including details about past events, current conditions, and reasonable and supportable forecasts and their implications for expected credit losses. The new guidance is applicable to the Company for interim and annual reporting periods beginning after December 15, 2019 and requires its application using a retrospective transition method. The Company is currently evaluating the impact of the amended guidance on ~~the~~its consolidated condensed financial statements.

~~Compensation—Equity-Based Compensation~~

In March 2016, the FASB issued guidance that simplified several areas of employee equity-based compensation accounting, including income taxes, forfeitures, minimum statutory withholding requirements and classifications within the statement of cash flows. More significantly, the new guidance eliminated the need to track tax windfalls in a separate pool within additional paid-in capital; instead, excess tax benefits and tax deficiencies are to be recorded within income tax expense. The new guidance also gives entities the ability to elect whether to estimate forfeitures or account for them as they occur. The Company adopted the provisions of this guidance effective January 1, 2017. Adoption of the requirements within this guidance related to excess tax benefits, forfeitures, minimum statutory withholding requirements and classifications within the statement of cash flows did not have a material impact on the Company’s consolidated condensed financial statements. The recognition of a $10 million deferred tax asset as of January 1, 2017 related to an unrecognized excess tax benefit was fully offset by a valuation allowance recorded as it is more-likely-than-not that the deferred tax asset will not be realized.

Leases

In February 2016, the FASB issued guidance on lease accounting that supersedes the current guidance on leases. The new guidance establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with the classification affecting the pattern of expense recognition in the ~~income statement.~~statement of operations. The new guidance is applicable to the Company for interim and annual reporting periods beginning after December 15, 2018. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption of the amendments in the guidance is permitted. The ~~Company is currently evaluating the impact of the guidance on the consolidated condensed financial statements. The~~ Company’s minimum lease commitments for operating leases as of March 31, ~~2017~~2018 was ~~$100~~$98 million.

~~Revenue Recognition~~

~~In May 2014,~~ The Company is currently evaluating the ~~FASB issued~~impact of the guidance on revenue from contracts with customers that will supersede most current revenue recognition guidance, including industry-specific guidance. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include capitalization of certain contract costs, consideration of the time value of money in the transaction price and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers.its consolidated condensed financial statements.

In August 2015, the FASB delayed the effective date of the new revenue guidance issued in May 2014 by one year but allowed companies a choice to adopt the guidance as of the original effective date that was set out in May 2014. The Company has decided to adopt the guidance beginning January 1, 2018. The

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

~~2. Recently Issued Accounting Pronouncements (Continued)~~

3. Revenue

On January 1, 2018, the Company adopted the new revenue recognition guidance ~~permits~~applying the ~~use of either a full or~~ modified retrospective ~~adoption approach.~~method to all contracts. Results for reporting periods beginning after January 1, 2018 are presented under the new revenue recognition guidance, while prior period amounts are not adjusted and continue to be reported in accordance with the historic accounting under previous revenue recognition guidance. The Company recorded a $1 million reduction to its accumulated deficit balance as of January 1, 2018, representing the cumulative impact of adopting the new revenue recognition guidance, which primarily relates to the timing of recognition of hotel reservations in the Company’s Beyond Air revenue. The impact to net revenue for the quarter ended March 31, 2018 was a decrease of less than $1 million as a result of applying the new revenue recognition guidance.

The Company operates a travel commerce platform providing distribution, technology, payment, mobile and other solutions for the global travel and tourism industry. Through its Travel Commerce Platform, the Company connects travel providers (“customers”), such as airlines, hotel chains and car rental companies with online and offline travel buyers, including travel agencies, travel management companies and corporations. The Company also provides critical information technology services to airlines, such as shopping, ticketing, departure control, business intelligence and other solutions.

The following table presents the Company’s net revenue disaggregated by its source. Sales and usage-based taxes are excluded from net revenue.

	Three Months Ended
	March 31,
(in $ thousands)	2018
Air	$	472,935
Beyond Air		179,751
Travel Commerce Platform⁽¹⁾		652,686
Technology Services		25,152
Net revenue	$	677,838

(1)

Includes $18 million of Travel Commerce Platform revenue for the three months ended March 31, 2018 that does not represent revenue recognized from contracts with customers.

Travel Commerce Platform Revenue

Travel Commerce Platform revenue primarily utilizes a transaction volume model to recognize revenue. The Company charges a fee per segment booked. The Company also receives a fee for cancellations of bookings previously made on the Company’s platform and a fee for tickets issued by the Company that were originally booked on an alternative system.

Revenue for air bookings is recognized at the time of reservation, net of estimated cancellations and anticipated incentives payable to customers. Cancellations prior to the date of departure are estimated based on the historical level of cancellations (net of cancellation fees).

The Company’s Beyond Air portfolio includes hospitality, payment solutions, digital services, advertising and other platform services. Revenue for hotel reservations is recognized upon check-in and revenue for car reservations is recognized upon pick-up, as such reservations can generally be cancelled without penalty. The Company’s payment solutions revenue is earned primarily as a percentage of total transaction value in the form of a share of interchange fees. Revenue is recognized at the point in time when the payment is processed.

The Company collects annual fees from travel agencies, internet sites and other subscribers to access the applications on its Travel Commerce Platform, including providing the ability to access schedule and fare information, book reservations and issue tickets. Where the contractual terms are on a subscription basis with fixed amounts of fees, revenue is recognized ratably over the contract period as the performance obligation is satisfied over time. Where the contractual terms are transaction-based with fees charged per transaction, revenue is recognized as the services are provided.

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

The table below sets forth Travel Commerce Platform revenue disaggregated by region:

	Three Months Ended
	March 31,
(in $ thousands)	2018
Asia Pacific		141,551
Europe		244,442
Latin America and Canada		29,859
Middle East and Africa		79,106
International		494,958
United States		157,728
Travel Commerce Platform⁽¹⁾		652,686

(1)

Includes $18 million of Travel Commerce Platform revenue for the three months ended March 31, 2018 that does not represent revenue recognized from contracts with customers.

Technology Services Revenue

The Company collects fees, generally on a monthly basis under long-term contracts, for providing hosting solutions and other services to airlines such as shopping, ticketing, departure control, business intelligence and other solutions. Where the contractual terms are on a subscription basis with fixed amounts of fees, revenue is recognized ratably over the contract period as the performance obligation is satisfied over time. Where the contractual terms are transaction-based with fees charged per transaction, revenue is recognized as the services are provided.

Contract Balances

Where a performance obligation has been satisfied but not yet invoiced at the reporting date, a contract asset is recognized on the balance sheet. Where a performance obligation has not yet been satisfied but an invoice has been raised at the reporting date, a contract liability is recognized on the balance sheet.

The opening and closing balances of the Company’s accounts receivables and contract liabilities (current and non-current) are as follows:

			Contract Liabilities
(in $ thousands)	Accounts Receivable, net⁽¹⁾		Deferred Revenue (current)⁽¹⁾		Deferred Revenue (non-current)
Balance as of March 31, 2018	$	231,336	$	32,186	$	6,367
Balance as of January 1, 2018		174,765		32,010		6,056
Increase	$	56,571	$	176	$	311

(1)

Accounts receivables, net, and deferred revenue exclude balances not related to contracts with customers.

The majority of the Company’s Air revenue within its Travel Commerce Platform is collected through the Airline Clearing House (“ACH”) and other similar clearing houses, whereby the payments are submitted monthly to the ACH and are settled (on a net basis) within approximately 30 days. Airlines that do not settle payment through the ACH and customers in Beyond Air and Technology Services are generally invoiced on a monthly basis, and the payments are generally received within approximately 30-60 days.

Deferred revenue is recorded when cash payments are received or due in advance of the Company’s performance, including amounts that are refundable. The cash payments received or due in advance of satisfying the Company’s performance obligations, was offset by $6 million of net revenue recognized that were included in the deferred revenue balance as of December 31, 2017.

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

Remaining Performance Obligations

As of March 31, 2018, the aggregate amount of the transaction price allocated to the remaining performance obligations was approximately $57 million, of which the Company expects to ~~adopt~~recognize revenue of approximately 78% over the ~~guidance using~~next 24 months, including 45% over the ~~modified retrospective approach, under~~next 12 months.

The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected term of one year or less and (ii) contracts for which the ~~cumulative effect~~Company recognizes revenue at the amounts to which it has the right to invoice for services performed.

4. Income Taxes

The Company’s tax provision differs significantly from the expected provision amount calculated at the U.S. federal statutory rate primarily as a result of ~~initially applying~~(i) being subject to income tax in numerous non- U.S. jurisdictions with varying income tax rates, (ii) a valuation allowance maintained in various jurisdictions, including the ~~guidance~~U.S. and the U.K., due to historical losses in such jurisdictions, (iii) certain expenses that are not deductible for tax or do not secure an effective tax deduction under the relevant jurisdictions, (iv) certain income or gains that are not subject to tax, (v) the impact of the U.S. Tax Reforms (as defined below) and (vi) the impact of changes in the U.K. to the tax deductibility of interest.

As of December 31, 2017, the Company had U.S. federal net operating losses (“NOL”) carry forwards of approximately $400 million, which expire between 2032 and 2037, state NOL carry forwards, which expire between 2018 and 2037, and alternative minimum tax (“AMT”) and other tax credits carry forward of approximately $27 million. The Company had other non–U.S. NOL carry forwards of $345 million that expire between three years and indefinitely. The deferred tax asset in respect of these U.S. and non–U.S. NOL carry forwards and U.S. tax credits were $197 million. The Company believes it is more likely than not that the benefit from certain U.S. federal, U.S. state and non–U.S. NOL carry forwards and other deferred tax assets will not be ~~recognized~~realized. Consequently, a valuation allowance of $187 million has been recorded against such deferred tax assets as of December 31, 2017.

The Company regularly assesses its ability to realize deferred tax assets. As of March 31, 2018, the Company’s estimated annual effective tax rate includes the impact of (i) releasing a portion of the valuation allowance associated with the U.S. NOL carry forwards due to an increase in taxable temporary differences that support deferred tax asset utilization and (ii) releasing a portion of the valuation allowance associated with the U.K. NOL carry forwards (see below). However, the Company has maintained a valuation allowance on the remaining deferred tax assets. Future realized earnings performance and changes in future earnings projections, among other factors, may cause an adjustment to the ~~opening balance of retained earnings (or accumulated losses)~~conclusion as ~~of January 1, 2018. The guidance also permits~~to whether it is more likely than not that the ~~application~~benefit of the ~~modified retrospective approach to either all contracts as~~deferred tax assets will be realized. This would impact the income tax expense in the period for which it is determined that these factors have changed.

As a result of the ~~date of initial application or only to contracts that are not completed as of this date. The~~Company’s debt restructuring in March 2018 (see Note 11–Long-Term Debt), the Company expects ~~to apply the modified retrospective approach only to contracts~~ that ~~are not completed as of January 1, 2018.~~

~~The Company is~~there will be future taxable income in the ~~process~~U.K. other than the reversal of ~~evaluating its contracts~~deferred tax liabilities. Consequently, the Company has realized a benefit of $10 million following the release of the valuation allowance on deferred tax assets associated with ~~customers and analyzing~~U.K. NOL carry forwards.

The Company’s preliminary estimate of the impact of the ~~new guidance on~~comprehensive changes to the U.S. tax legislation that were enacted in December 2017 under the Tax Cuts and Jobs Act (the “U.S. Tax Reforms”) is subject to the finalization of management’s analysis related to certain matters, such as developing interpretations of the provisions of the U.S. Tax Reforms, the impact of state income taxes, administrative interpretations or court decisions interpreting the U.S. Tax Reforms that may require further adjustments and changes in the Company’s ~~revenue contracts, comparing its current accounting policies and practices~~estimates that could be beneficial or adverse. The Company continued to assess the ~~requirements~~impact of the ~~new guidance,~~U.S. Tax Reforms during the three months ended March 31, 2018 and ~~identifying potential differences that would result~~expects to complete its assessment and resultant accounting, if any, by December 2018 (being the one–year measurement period from ~~applying~~ the ~~new guidance to its contracts. The Company is also in the process~~date of ~~identifying and implementing changes to its business processes, systems and controls to support adoption~~enactment of the ~~new guidance in 2018. As of March 31, 2017, the expected impact on the consolidated condensed financial statements cannot be reasonably estimated.~~U.S. Tax Reforms).

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

5. Other Current Assets

Other current assets consisted of:

(in $ thousands)
March 31,
2017

December 31,
2016

Sales and use tax receivables $ 26,216 $ 27,178
Prepaid expenses 25,339 26,289
Client funds 19,265 11,632
Prepaid incentives 13,698 9,492
Derivative assets 2,325 856
Other 12,443 8,642
$ 99,286 $ 84,089

	March 31,		December 31,
(in $ thousands)	2018		2017
Client funds	$	34,125	$	15,774
Sales and use tax receivables		32,309		30,163
Prepaid expenses		28,268		24,271
Prepaid incentives		16,236		16,677
Derivative assets		22,238		15,233
Other		9,350		7,606
	$	142,526	$	109,724

Client funds represent cash held on behalf of clients for a short period of time before being transferred to travel industry partners. A compensating balance is held in accrued expenses and other current liabilities as customer prepayments.

6. Property and Equipment, Net

Property and equipment, net, consisted of:

March 31, 2017 December 31, 2016
(in $ thousands) Cost
Accumulated
depreciation
Net Cost
Accumulated
depreciation
Net
Capitalized software $ 965,418 $ (756,921) $ 208,497 $ 925,998 $ (736,573) $ 189,425
Computer equipment 342,479 (207,804) 134,675 344,112 (205,222) 138,890
Building and leasehold improvements 26,670 (9,313) 17,357 27,187 (9,622) 17,565
Construction in progress 54,110 — 54,110 85,166 — 85,166
$ 1,388,677 $ (974,038) $ 414,639 $ 1,382,463 $ (951,417) $ 431,046

	March 31, 2018							December 31, 2017
			Accumulated							Accumulated
(in $ thousands)	Cost		depreciation			Net		Cost		depreciation			Net
Capitalized software	$	1,074,053	$	(850,777	)	$	223,276	$	1,029,772	$	(829,416	)	$	200,356
Computer equipment		346,769		(217,089	)		129,680		346,846		(207,484	)		139,362
Building and leasehold improvements		33,389		(13,745	)		19,644		32,834		(12,972	)		19,862
Construction in progress		62,754		—			62,754		72,161		—			72,161
	$	1,516,965	$	(1,081,611	)	$	435,354	$	1,481,613	$	(1,049,872	)	$	431,741

The Company recorded depreciation expense (including depreciation on assets under capital leases) of ~~$43~~$38 million and ~~$41~~$43 million during the three months ended March 31, 2018 and 2017, ~~and 2016,~~ respectively.

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~4. Property and Equipment, Net (Continued)~~

As of March 31, ~~2017~~2018 and December 31, ~~2016,~~2017, the Company had capital lease assets of ~~$192~~$210 million and ~~$195~~$208 million, respectively, with accumulated depreciation of ~~$100~~$116 million and ~~$93~~$107 million, respectively, included within computer equipment.

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

7. Intangible Assets

The changes in the carrying amount of goodwill and intangible assets ~~for~~of the Company between January 1, 2018 and March 31, 2018 are as follows:

	January 1,									Foreign			March 31,
(in $ thousands)	2018			Additions			Retirements			Exchange			2018
Non-Amortizable Assets:
Goodwill	$	1,089,590		$	—		$	—		$	925		$	1,090,515
Trademarks and tradenames		313,097			—			—			—			313,097
Other Intangible Assets:
Acquired intangible assets		743,549			—			—			6			743,555
Accumulated amortization		(461,666	)		(10,166	)		—			(32	)		(471,864	)
Acquired intangible assets, net		281,883			(10,166	)		—			(26	)		271,691
Customer loyalty payments		380,841			45,126			(10,551	)		2,008			417,424
Accumulated amortization		(166,544	)		(22,343	)		10,315			(843	)		(179,415	)
Customer loyalty payments, net		214,297			22,783			(236	)		1,165			238,009
Other intangible assets, net	$	496,180		$	12,617		$	(236	)	$	1,139		$	509,700

The changes in the carrying amount of goodwill and intangible assets of the Company between January 1, 2017 and March 31, 2017 are as follows:

(in $ thousands)
January 1,
2017
Additions Retirements
Foreign
Exchange

March 31,
2017

Non-Amortizable Assets:
Goodwill $ 1,079,951 $ — $ — $ 2,364 $ 1,082,315
Trademarks and tradenames 313,097 — — — 313,097
Other Intangible Assets:
Acquired intangible assets 1,127,059 — (368,715) 26 758,370
Accumulated amortization (804,089) (10,392) 368,715 (52) (445,818)
Acquired intangible assets, net 322,970 (10,392) — (26) 312,552
Customer loyalty payments 358,259 28,354 (12,908) 2,076 375,781
Accumulated amortization (169,622) (18,795) 12,908 (2,074) (177,583)
Customer loyalty payments, net 188,637 9,559 — 2 198,198
Other intangible assets, net $ 511,607 $ (833) $ — $ (24) $ 510,750

~~The changes in the carrying amount of goodwill and intangible assets for the Company between January 1, 2016 and March 31, 2016 are as follows:~~

(in $ thousands)
January 1,
2016
Additions Retirements
Foreign
Exchange

March 31,
2016

Non-Amortizable Assets:
Goodwill $ 1,067,415 $ — $ — $ 4,660 $ 1,072,075
Trademarks and tradenames 313,961 — — 52 314,013
Other Intangible Assets:
Acquired intangible assets 1,127,360 — — (26) 1,127,334
Accumulated amortization (756,489) (11,139) — (552) (768,180)
Acquired intangible assets, net 370,871 (11,139) — (578) 359,154
Customer loyalty payments 300,142 32,050 (19,880) 4,124 316,436
Accumulated amortization (136,473) (16,574) 19,154 (1,556) (135,449)
Customer loyalty payments, net 163,669 15,476 (726) 2,568 180,987
Other intangible assets, net $ 534,540 $ 4,337 $ (726) $ 1,990 $ 540,141

	January 1,									Foreign			March 31,
(in $ thousands)	2017			Additions			Retirements			Exchange			2017
Non-Amortizable Assets:
Goodwill	$	1,079,951		$	—		$	—		$	2,364		$	1,082,315
Trademarks and tradenames		313,097			—			—			—			313,097
Other Intangible Assets:
Acquired intangible assets		1,127,059			—			(368,715	)		26			758,370
Accumulated amortization		(804,089	)		(10,392	)		368,715			(52	)		(445,818	)
Acquired intangible assets, net		322,970			(10,392	)		—			(26	)		312,552
Customer loyalty payments		358,259			28,354			(12,908	)		2,076			375,781
Accumulated amortization		(169,622	)		(18,795	)		12,908			(2,074	)		(177,583	)
Customer loyalty payments, net		188,637			9,559			—			2			198,198
Other intangible assets, net	$	511,607		$	(833	)	$	—		$	(24	)	$	510,750

The Company paid cash of ~~$17~~$27 million and ~~$25~~$17 million for customer loyalty payments during the three months ended March 31, ~~2017~~2018 and ~~2016,~~2017, respectively. Further, as of March 31, ~~2017~~2018 and December 31, ~~2016,~~2017, the Company had balances payable of ~~$70~~$94 million and ~~$60~~$77 million, respectively, for customer loyalty payments.

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~5. Intangible Assets (Continued)~~

Amortization expense for acquired intangible assets was $10 million ~~and $11 million~~ for each of the three months ended March 31, ~~2017~~2018 and ~~2016, respectively,~~2017 and is included as a component of depreciation and amortization in the Company’s consolidated condensed statements of operations.

Amortization expense for customer loyalty payments was ~~$19~~$22 million and ~~$17~~$19 million for the three months ended March 31, ~~2017~~2018 and ~~2016,~~2017, respectively, and is included within cost of revenue or net revenue in the Company’s consolidated condensed statements of operations.

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

8. Other Non-Current Assets

Other non-current assets consisted of:

(in $ thousands)
March 31,
2017

December 31,
2016

Prepaid incentives $ 26,415 $ 25,538
Deferred financing costs 4,313 4,752
Supplier prepayments 3,630 3,454
Derivative assets 2,510 1,719
Pension assets 1,711 989
Other 9,881 10,312
$ 48,460 $ 46,764

	March 31,		December 31,
(in $ thousands)	2018		2017
Prepaid incentives	$	35,349	$	35,645
Pension assets		9,985		8,674
Supplier prepayments		8,461		10,983
Derivative assets		7,740		3,503
Deferred financing costs		1,828		1,930
Other		13,995		16,073
	$	77,358	$	76,808

9. Restructuring Charges

In November 2016, the Company committed to undertake a course of action ~~(the “Program”)~~ to enhance and optimize the Company’s operational and technological efficiency. The Program involves (i) consolidating the multiple technological vendors with which the Company currently works, (ii) establishing a new centralized quality assurance function and (iii) consolidating the Company’s three existing U.S. technology hubs in Atlanta, Denver and Kansas City into two centers in Atlanta and Denver. These actions are expected to contribute to the achievementThis program was substantially completed as of ~~the Company’s long-term targets. The Program is expected to be completed by mid-2018.~~

The Company expects total charges under the Program in connection with severance and employee-related obligations to be approximately $14 million to $16 million and costs related to implementation to be approximately $13 million to $15 million, including approximately $1 million for the termination of operating lease and other contracts. The Company expects the obligations related to these costs to be paid in cash which will be funded from operations.

Severance and employee-related costs were recorded based on the Program developed by the business and corporate management which specified positions to be eliminated, benefits to be paid for involuntary terminations under existing severance plans or as a one-time arrangement and the expected timetable for completion of the plan. Estimates of restructuring costs and benefits were made based on information available at the time the charges were recorded. Due to the inherent uncertainty involved, actual amounts paid for such activities may differ from amounts initially recorded, and the Company may need to revise previous estimates.

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~7. Restructuring Charges (Continued)~~

~~The following table summarizes the activities related to the Company’s restructuring liability during the three month ended March~~December 31, ~~2017 which is included in accrued expenses and other current liabilities in the consolidated condensed balance sheets:~~

(in $ thousands)
Severance and
Employee-Related
Obligations

Implementation
Costs
Total
Balance as of January 1, 2017 $ 11,082 $ 1,686 $ 12,768
Restructuring charges recognized 2,381 1,037 3,418
Cash payments made (372) (2,558) (2,930)
Balance as of March 31, 2017 $ 13,091 $ 165 $ 13,256

2017.

Total restructuring charges recognized of $0 and $3 million for the three months ended March 31, 2018 and 2017, respectively, are included within selling, general and administrative expenses in the consolidated condensed statements of operations.

10. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of:

(in $ thousands)
March 31,
2017

December 31,
2016

Accrued commissions and incentives $ 321,145 $ 267,488
Accrued payroll and related 65,231 83,783
Deferred revenue 44,460 42,233
Income tax payable 25,956 17,560
Customer prepayments 19,265 11,632
Derivative liabilities 15,779 21,771
Accrued interest expense 13,125 15,215
Pension and post-retirement benefit liabilities 1,727 1,655
Other 21,174 17,223
$ 527,862 $ 478,560

	March 31,		December 31,
(in $ thousands)	2018		2017
Accrued commissions and incentives	$	356,856	$	282,954
Accrued payroll and related		61,631		70,234
Deferred revenue		55,683		48,096
Income tax payable		35,113		32,986
Customer prepayments		34,125		15,774
Derivative liabilities		1,397		292
Accrued interest expense		4,131		12,010
Pension and post-retirement benefit liabilities		1,699		1,628
Other		26,135		45,094
	$	576,770	$	509,068

Included in accrued commissions and incentives are ~~$70~~$94 million and ~~$60~~$77 million of accrued customer loyalty payments as of March 31, ~~2017~~2018 and December 31, ~~2016,~~2017, respectively.

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

11. Long-Term Debt

Long-term debt consisted of:

(in $ thousands)
Interest
rate
Maturity
March 31,
2017

December 31,
2016

Senior Secured Credit Agreement
Term loans
Dollar denominated(1)(2)(3)
L+3.25% September 2021 $ 2,232,453 $ 2,236,157
Revolver borrowings
Dollar denominated L+5.00% September 2019 — —
Capital leases and other indebtedness 100,776 108,611
Total debt $ 2,333,229 $ 2,344,768
Less: current portion 62,441 63,558
Long-term debt $ 2,270,788 $ 2,281,210

	Interest		March 31,		December 31,
(in $ thousands)	rate	Maturity	2018		2017
Senior Secured Credit Agreement
Term loans – (2018 Credit Agreement)⁽¹⁾	L+2.50%	March 2025	$	1,385,934	$	—
Term loans – (2014 Credit Agreement)⁽²⁾	L+2.75%	September 2021		—		2,124,439
Revolver borrowings – (2018 Credit Agreement)	L+2.25%	September 2022		—		—
Revolver borrowings – (2014 Credit Agreement)	L+2.50%	September 2022		—		—
Senior Secured Notes
Senior secured notes⁽³⁾	6.00%	March 2026		737,404		—
Capital leases and other indebtedness				99,786		105,574
Total debt				2,223,124		2,230,013
Less: current portion				54,089		64,291
Long-term debt			$	2,169,035	$	2,165,722

~~(1)~~

~~Minimum LIBOR floor~~

(1)

As of March 31, 2018, the principal amount of terms loans under the 2018 Credit Agreement (as defined below) was $1,400 million, which is netted for unamortized debt discount of $7 million and unamortized debt finance costs of $7 million.

(2)

As of December 31, 2017, the principal amount of terms loans under the 2014 Credit Agreement (as defined below) was $2,154 million, which is netted for unamortized debt finance costs of $13 million and unamortized debt discount of $17 million.

(3)

As of March 31, 2018, the principal amount of senior secured notes was $745 million, which is netted for unamortized debt finance costs of $8 million.

Senior Secured Credit Agreement

In March 2018, Travelport Finance (Luxembourg) S.à r.l. (the “Borrower”), a wholly-owned subsidiary of ~~1.00%~~

~~(2)~~

Asthe Company, entered into a new senior secured credit agreement (the “2018 Credit Agreement”). Under the 2018 Credit Agreement, the lenders agreed to extend credit to the Borrower in the form of ~~March 31, 2017 and December 31, 2016, the principal amounts of~~(a) initial secured term loans ~~were $2,272~~in an aggregate principal amount of $1,400 million ~~and $2,278 million, respectively, which is netted for unamortized debt finance costs of $17 million and $18 million, respectively, and unamortized debt~~maturing in March 2025, issued at a discount of ~~$22 million and $23 million, respectively.~~

~~(3)~~

~~Interest rate on~~0.50%, which amortizes in quarterly installments, commencing August 31, 2018, equal to 0.25% of the ~~term loans as of December 31, 2016, was LIBOR plus 4.00%~~

~~The Company is not contractually required to repay quarterly installments~~original principal amount of the term loans, ~~until~~with the ~~second quarter~~balance payable at maturity and (b) a revolving credit facility in an aggregate principal amount of ~~2019. However,~~$150 million maturing in September 2022.The Company used the ~~Company has classified a portion of the~~proceeds from these term loans, ~~as a current portion~~along with the proceeds from the issuance of ~~long-term debt as the Company intends~~senior secured notes (discussed below) and ~~is able to make additional voluntary prepayments of the term loans from~~ cash ~~flows from operations, which the Company expects to occur within the next twelve months. The amount of any such prepayments may vary based~~ on the ~~Company’s actual cash flow generation and needs, as well as general economic conditions.~~

~~In January 2017,~~balance sheet, to repay the Company entered into an amendment for its senior secured credit agreement, which (i) amended the applicable rates to 2.25% per annum, in the case of base rate loans, and 3.25% per annum, in the case of LIBOR loans and (ii) reset the 1% premium on the repricingoutstanding balance remaining of the term loans under the previous senior secured credit agreement (the “2014 Credit Agreement”) and to pay the related transaction expenses and fees.Upon the repayment in full of the obligations, the 2014 Credit Agreement was terminated.The Company recorded the debt refinancing transaction as the issuance of new debt and extinguishment of prior debt and recognized a loss of $28 million in its consolidated condensed statements of operations for ~~a period of six months. The~~the three months ended March 31, 2018.

Under the 2018 Credit Agreement, the interest rate per annum applicable to (a) the term loans is based on, at the election of the ~~Company, (i)~~Borrower, LIBOR plus ~~3.25%~~2.50% or base rate (as defined in the ~~senior secured credit~~ agreement) plus 1.50% and (b) the borrowings under revolving credit facility, at the election of the Borrower, LIBOR plus 2.25% or base rate (as defined in the agreement) plus 1.25%. ~~The term loans are subject to~~LIBOR rates and base rates have a ~~LIBOR~~ floor of ~~1.00% and a base rate floor of 2.00%~~0.00%. The Company expects to pay interest based on ~~LIBOR plus 3.25% for the term loans. During~~LIBOR.

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

Further, during the three months ended March 31, ~~2017, the average LIBOR rate applied to the term loans was 1.02%.~~

~~During the three months ended March 31, 2017,~~2018, the Company (i) repaid a quarterly installment of $6 million principal of term loans outstanding under the ~~senior secured credit agreement,~~2014 Credit Agreement, (ii) amortized $2$1 million of each of debt finance costs and ~~$1 million of~~ debt discount, ~~and~~ (iii) repaid ~~$10~~$7 million under its capital lease obligations ~~and other indebtedness~~ and entered into $2 million of new capital leases for information technology ~~assets.~~

assets and (iv) repaid $1 million under its other indebtedness obligations.

As discussed above, in March 2018, the Borrower entered into a new revolving credit facility under the 2018 Credit Agreement with a consortium of banks. The lenders, terms, credit facility amount and maturity date under the new revolving credit facility were substantially the same as under the 2014 Credit Agreement, except for the reduction in interest rates discussed above. Under the ~~senior secured credit agreement,~~new terms, the ~~Company~~Borrower has a ~~$125~~$150 million revolving credit facility, ~~with a consortium of banks,~~ which contains a letter of credit sub-limit up to a maximum of ~~$50~~$100 million. As of March 31, ~~2017, the Company had~~2018, there were no outstanding borrowings under ~~its~~the revolving credit facility under the 2018 Credit Agreement, and ~~utilized~~ $8 million was utilized for the issuance of letters of credit, with a balance of ~~$117~~$142 million remaining.

Senior Secured Notes

In March 2018, Travelport Corporate Finance PLC (the “Issuer”), a wholly-owned subsidiary of the Company, issued a principal amount of $745 million in senior secured notes due in March 2026 with a stated interest rate of 6.00% per annum. The proceeds were used to repay a portion of the term loans outstanding under the 2014 Credit Agreement. The interest on the senior secured notes is payable semi-annually in cash in arrears on March 15 and September 15 of each year, commencing September 15, 2018.

Debt Maturities

Aggregate maturities of debt as of March 31, 2018 are as follows:

							Capital Leases
(in $ thousands)	Term			Senior Secured			and Other
Year ending March 31,	Loans			Notes			Indebtedness
2019	$	10,500		$	—		$	43,589
2020		14,000			—			29,951
2021		14,000			—			16,638
2022		14,000			—			8,260
2023		14,000			—			1,348
Thereafter		1,333,500			745,000			—
		1,400,000			745,000			99,786
Less: Unamortized debt finance cost		(7,110	)		(7,596	)		—
Less: Unamortized debt discount		(6,956	)		—			—
Total debt	$	1,385,934		$	737,404		$	99,786

Debt Finance Costs

The Company had unamortized debt finance costs of (i) $7 million and $13 million as of March 31, 2018 and December 31, 2017, respectively, in relation to its term loans under the 2018 Credit Agreement and 2014 Credit Agreement, respectively, which are presented as a deduction from the principal amount of the term loans, (ii) $8 million as of March 31, 2018 in relation to its senior secured notes, which is presented as a deduction from the principal amount of senior secured notes, and (iii) $2 million as of both March 31, 2018 and December 31, 2017 in relation to its revolving credit facility, which are capitalized within other non-current assets on the consolidated condensed balance sheets. The debt finance costs are amortized over the term of the related debt into earnings as part of interest expense in the consolidated condensed statements of operations. The movements in total unamortized debt finance costs for the three months ended March 31, 2018 and 2017 are summarized below:

	Three Months			Three Months
	Ended March 31,			Ended March 31,
(in $ thousands)	2018			2017
Balance as of January 1	$	14,708		$	22,855
Capitalization of debt finance costs		14,799			—
Amortization		(914	)		(1,417	)
Write-off on early extinguishment of debt		(12,059	)		—
Balance as of March 31	$	16,534		$	21,438

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

~~9. Long-Term~~

Debt ~~(Continued)~~

Covenants and Guarantees

The 2018 Credit Agreement and the Indenture governing the senior secured notes contain financial and other covenants, including: limitations on the ability of Travelport Limited, a wholly-owned subsidiary of the Company and the Borrower’s and the Issuer’s immediate parent entity (the “Parent Guarantor”) and its restricted subsidiaries to incur debt or liens or make certain investments and acquisitions and restricted payments, limitations on transactions with affiliates and certain restrictions on the sale of assets. A violation of these covenants could result in the Parent Guarantor and its restricted subsidiaries being prohibited from making certain restricted payments, including dividends, or cause a default under the 2018 Credit Agreement or the Indenture, which would permit the participating lenders to restrict the Parent Guarantor’s and its restricted subsidiaries’ ability to access the revolving credit ~~agreement also permits~~facility and require the ~~issuance~~immediate repayment of ~~certain cash collateralized letters~~any outstanding advances made under the 2018 Credit Agreement or the Indenture. Solely in the case of the revolving credit ~~in addition to those that can be issued~~facility under the 2018 Credit Agreement, if the amount outstanding under the revolving credit facility ~~whereby 103%~~exceeds a certain threshold, there is a requirement to maintain a first lien leverage ratio.

The senior secured notes are guaranteed fully and unconditionally on a senior secured basis by the Parent Guarantor and certain of ~~cash collateral is to be maintained for outstanding letters~~its existing and future wholly-owned subsidiaries that also guarantee the facilities under the 2018 Credit Agreement. The senior secured notes and related guarantees are secured on a first-priority basis by security interests in all of ~~credit.~~the Issuer’s and the guarantors’ assets that also secure the facilities under the 2018 Credit Agreement on a first-priority basis. As of March 31, ~~2017, there were no outstanding cash collateralized letters of credit.~~

~~As of March 31, 2017,~~2018, the Company was in full compliance with all restrictive and financial covenants related to its ~~long-term~~ debt.

~~10.~~

12. Financial Instruments

The Company uses derivative financial instruments as part of its overall strategy to manage its exposure to market risks primarily associated with fluctuations in foreign currency exchange rates and interest rates. The Company does not use derivatives for trading or speculative purposes. During the three months ended March 31, ~~2017,~~2018, there was no material change in the Company’s foreign currency and interest rate risk management policies or in its fair value methodology. As of March 31, ~~2017,~~2018, the Company had a net ~~liability~~asset position of ~~$12~~$29 million related to its derivative financial ~~instruments associated with~~instruments.

Foreign Currency Risk

The Company’s primary foreign currency risk exposure as of March 31, 2018 was due to exchange rate fluctuations that arise from certain intercompany transactions and earnings denominated in non-U.S. dollar currencies and from non-functional currency denominated assets and liabilities.

The Company uses foreign currency derivative contracts (forward contracts) to manage its ~~interest rate risk and~~exposure to changes in foreign currency exchange ~~rate risk.~~

rates, primarily exposure to British pound, Euro and Australian dollar. The Company did not designate these foreign currency derivative contracts as accounting hedges. Fluctuations in the value of these foreign currency derivative contracts were recorded within the Company’s consolidated condensed statements of operations, which partially offset the impact of the changes in the value of the foreign currency denominated receivables and payables and forecasted earnings they were intended to economically hedge.

Interest Rate Risk

As of March 31, 2018, the Company’s primary interest rate risk exposure ~~as of March 31, 2017~~ was to interest rate fluctuations in the United States, specifically the impact of LIBOR interest rates on the Company’s U.S. dollar denominated variable rate term loans. ~~The term loans have a 1.00% LIBOR floor under the Company’s senior secured credit agreement.~~ During the three months ended March 31, ~~2017,~~2018, the average LIBOR ~~rates increased above~~rate applied to the ~~LIBOR floor of 1.00%~~term loans was 1.64%. In order to protect against potential higher interest costs resulting from increases in LIBOR, ~~in October 2015,~~as of March 31, 2018, the Company ~~transacted $1,400 million notional amount of~~had outstanding interest rate swap contracts covering a period from February 2017 to February 2019. Further, during the three months ended March 31, 2017, the Company transacted $1,200 million notional amount of interest rate swap contracts commencing February 2019 until February 2020. These swapsthat fix the LIBOR rate payable ~~on approximately 60% of the Company’s floating rate debt during these periods at average rates of 1.4010% and 2.1906%, respectively.~~as follows:

		Average
Notional Amount		Interest
($ in thousands)	Period	Rate
1,400,000	February 2017 to February 2019	1.4010%
1,200,000	February 2019 to February 2020	2.1906%
400,000	February 2020 to February 2021	2.1925%

The Company’s primary foreign currency risk exposure as of March 31, 2017 was to exchange rate fluctuations that arise from certain intercompany transactions and from non-functional currency denominated assets and liabilities and earnings denominated in non-U.S. dollar currencies.

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

~~10. Financial Instruments (Continued)~~

Presented below is a summary of the gross fair value of the Company’s derivative contracts, which have not been designated as hedging instruments, recorded on the consolidated condensed balance ~~sheets at fair value.~~

Fair Value Asset Fair Value (Liability)
(in $ thousands)
Balance Sheet
Location

March 31,
2017

December 31,
2016

Balance Sheet
Location

March 31,
2017

December 31,
2016

Interest
rate swap
contracts Other
current assets $ 1,035 $ 768 Accrued expenses
and other current
liabilities $ — $ —
Interest
rate swap
contracts Other
non-current
assets 2,510 1,719 Other non-current
liabilities (832) —
Foreign currency
contracts Other
current assets 1,290 88 Accrued expenses
and other current
liabilities (15,779) (21,771)
Total fair value of
derivative assets
(liabilities) $ 4,835 $ 2,575 $ (16,611) $ (21,771)

sheets:

		Fair Value Asset					Fair Value (Liability)
	Balance Sheet	March 31,		December 31,		Balance Sheet	March 31,			December 31,
(in $ thousands)	Location	2018		2017		Location	2018			2017
Interest rate swap contracts	Other current assets	$	10,940	$	4,799	Accrued expenses and other current liabilities	$	—		$	—
Interest rate swap contracts	Other non-current assets		7,740		3,503	Other non-current liabilities		—			(51	)
Foreign currency contracts	Other current assets		11,298		10,434	Accrued expenses and other current liabilities		(1,397	)		(292	)
Total fair value of derivative assets (liabilities)		$	29,978	$	18,736		$	(1,397	)	$	(343	)

As of March 31, ~~2017,~~2018, the net notional amounts of ~~foreign currency forward~~the Company’s derivative contracts ~~was $292 million,~~ and for interest rate swap contracts covering a period from February 2017 to February 2019 was $1,400 million and for contracts covering a period from February 2019 to February 2020 was $1,200 million.

the periods covered by them are as follows:

	March 31,		December 31,
(in $ thousands)	2018		2017
Interest rate swap contracts (varying contracts and periods as discussed above)	$	3,000,000	$	3,000,000
Foreign currency contracts (covering the period until March 2019)		409,652		373,487

The following table provides a reconciliation of the movement in the net carrying amount of derivative financial instruments during the three months ended March 31, ~~2017~~2018 and ~~2016.~~

(in $ thousands)
Three Months Ended
March 31, 2017

Three Months Ended
March 31, 2016

Net derivative liability opening balance $ (19,196) $ (2,111)
Total gain (loss) for the period included in net income 2,284 (14,605)
Payments on settlement of foreign currency derivative contracts 5,136 9,261
Net derivative liability closing balance $ (11,776) $ (7,455)

2017:

	Three Months Ended			Three Months Ended
(in $ thousands)	March 31, 2018			March 31, 2017
Net derivative asset (liability) opening balance	$	18,393		$	(19,196	)
Total gain for the period included in net income		16,281			2,284
(Proceeds from) payments on settlement of derivative contracts		(6,093	)		5,136
Net derivative asset (liability) closing balance	$	28,581		$	(11,776	)

The table below presents the impact of the changes in fair values of derivatives not designated as hedges on net income during the three months ended March 31, ~~2017~~2018 and ~~2016:~~

Amount of Income (Loss)
Recorded in Net Income
(in $ thousands) Statement of Operations location Three Months Ended
March 31,
2017 2016
Interest rate swap contracts Interest expense, net $ 226 $ (16,456)
Foreign currency contracts Selling, general and administrative 2,058 1,851
$ 2,284 $ (14,605)

2017:

		Amount of Gain
		Recorded in Net Income
		Three Months Ended
	Location of Gain Recorded	March 31,
(in $ thousands)	in Statement of Operations	2018		2017
Interest rate swap contracts	Interest expense, net	$	11,222	$	226
Foreign currency contracts	Selling, general and administrative		5,059		2,058
		$	16,281	$	2,284

Fair Value Disclosures for All Financial Instruments

The carrying amounts of cash and cash equivalents, accounts receivable, other current assets, accounts payable and accrued expenses and other current liabilities approximate fair value due to the short-term maturities of these assets and liabilities.

~~TABLE OF CONTENTS~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

~~10. Financial Instruments (Continued)~~

The fair values of the Company’s other financial instruments are as follows:

March 31, 2017 December 31, 2016
(in $ thousands) Fair Value Hierarchy Carrying Amount Fair Value Carrying Amount Fair Value
Asset (liability)
Derivative assets Level 2 $ 4,835 $ 4,835 $ 2,575 $ 2,575
Derivative liabilities Level 2 (16,611) (16,611) (21,771) (21,771)
Total debt Level 2 (2,333,229) (2,387,968) (2,344,768) (2,402,783)

		March 31, 2018						December 31, 2017
(in $ thousands)	Fair Value Hierarchy	Carrying Amount			Fair Value			Carrying Amount			Fair Value
Asset (liability)
Derivative assets	Level 2	$	29,978		$	29,978		$	18,736		$	18,736
Derivative liabilities	Level 2		(1,397	)		(1,397	)		(343	)		(343	)
Total debt	Level 2		(2,223,124	)		(2,249,765	)		(2,230,013	)		(2,258,893	)

The significant unobservable inputs used to fair value the Company’s derivative financial instruments are based on market quoted probability rates of default for each of the derivative assets and liabilities, resulting in a weighted average probability of default of ~~approximately 4%~~less than 1% and a recovery rate of 75% for derivative assets and 65% for derivative liabilities. ~~In accordance with the Company’s policy, as~~As the credit valuation adjustment applied to arrive at the fair value of derivatives ~~has not been greater~~is less than 15% of the unadjusted fair value of derivative instruments for two consecutive quarters, the Company has categorized derivative fair valuations at Level 2 of the fair value hierarchy. A 10% change in the significant unobservable inputs will not have a material impact on the fair value of the derivative financial instruments as of March 31, ~~2017.~~

2018.

The fair value of the Company’s total debt has been determined by calculating the fair value of its term loans and senior secured notes based on quoted prices obtained from independent brokers for identical debt instruments when traded as an asset and is categorized within Level 2 of the fair value hierarchy.

~~11.~~

13. Commitments and Contingencies

Purchase Commitments

In the ordinary course of business, the Company makes various commitments to purchase goods and services from specific suppliers, including those related to capital expenditures. As of March 31, ~~2017,~~2018, the Company had approximately ~~$93~~$80 million of outstanding purchase commitments, primarily relating to service contracts for information technology, of which ~~$37~~$44 million relates to the twelve months ending March 31, ~~2018.~~2019. These purchase obligations extend through ~~2019.~~

2022.

Contingencies

Company Litigation

The Company is involved in various claims, legal proceedings and governmental inquiries related to contract disputes, business practices, intellectual property and other commercial, employment and tax matters. The Company believes it has adequately accrued for such matters as appropriate or, for matters not requiring accrual, believes they will not have a material adverse effect on its results of operations, financial position or cash flows based on information currently available. However, litigation is inherently unpredictable and although the Company believes its accruals are adequate and/or that it has valid defenses in these matters, unfavorable resolutions could occur, which could have a material effect on the Company’s results of operations or cash flows in a particular reporting period.

Standard Guarantees/Indemnification

In the ordinary course of business, the Company enters into numerous agreements that contain standard guarantees and indemnities whereby the Company indemnifies another party for breaches of representations and warranties. In addition, many of these parties are also indemnified against any

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~11. Commitments and Contingencies (Continued)~~

third-party claim resulting from the transaction that is contemplated in the underlying agreement. Such guarantees or indemnifications are granted under various agreements, including those governing (i) purchases, sales or outsourcing of assets or businesses, (ii) leases of real estate, (iii) licensing of trademarks, (iv) use of derivatives and (v) issuances ~~or sales~~ of debt or equity securities. The guarantees or indemnifications issued are for the benefit of the (i) buyers in sale agreements and sellers in purchase agreements, (ii) landlords in lease contracts, (iii) licensees of the Company’s trademarks, (iv) financial institutions in derivative contracts and (v) underwriters in debt or equity security ~~issuances or sales.~~issuances. While some of these guarantees extend only for the duration of the underlying agreement, many survive the expiration of the term of the agreement or extend into perpetuity (unless subject to a legal statute of limitations). There are no specific limitations on the maximum potential amount of future payments the Company could be required to make under these guarantees, nor is the Company able to develop an estimate of the maximum potential amount of future payments to be made under these guarantees, as the triggering events are not subject to predictability and there is little or no history of claims against the Company under such arrangements. With respect to certain of the aforementioned guarantees, such as indemnifications of landlords against third-party claims for the use of real estate property leased by the Company, the Company maintains insurance coverage that mitigates any potential payments to be made.

~~12.~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

14. Equity

Dividends on Common Shares

The Company’s Board of Directors declared the following cash dividend during the three months ended March 31, ~~2017:~~

Declaration Date
Dividend Per
Share

Record
Date

Payment
Date

Amount
(in $ thousands)

February 13, 2017 $ 0.075 March 2, 2017 March 16, 2017 $ 9,306

2018:

	Dividend	Record	Payment	Amount
Declaration Date	Per Share	Date	Date	(in $ thousands)
February 16, 2018	$0.075	March 1, 2018	March 15, 2018	$9,406

On May ~~5, 2017,~~2, 2018, the Company’s Board of Directors declared a cash dividend of $0.075 per common share (see Note ~~15—~~18—Subsequent Events).

~~13.~~

15. Equity-Based Compensation

As discussed in Note 2—Recently Issued Accounting Pronouncements, effective January 1, 2017, the Company adopted the provisions of a new guidance on equity-based compensation accounting which simplified its several areas of accounting, including income taxes, forfeitures, minimum statutory withholding requirements and classifications within the statement of cash flows. The adoption of this guidance did not have a material impact on the Company’s consolidated condensed financial statements. The recognition of a $10 million deferred tax asset as of January 1, 2017 related to an unrecognized excess tax benefit was fully offset by a valuation allowance recorded as it is more-likely-than-not that the deferred tax asset will not be realized.

Restricted Share Units (“RSUs”)

During the three months ended March 31, ~~2017,~~2018, as part of its annual grant program, the Company granted ~~691,502~~592,579 RSUs. ~~The~~These RSUs vest one-fourth annually over a period of four years, if the employee continues to remain in employment during the vesting period. The Company further granted 202,100 RSUs to certain employees that cliff-vest in approximately two years from the grant date upon continued employment of the employee during the vesting period. RSUs accrue dividend equivalents associated with the underlying common shares as dividends are declared by the Company. Dividends will generally be paid to holders of RSUs in cash upon the vesting of the associated RSUs and will be forfeited should the RSUs not vest. The RSUs do not have an exercise price, and the fair value of the RSUs is considered to be the closing market price of the Company’s common shares at the date of grant. Certain of the Company’s outstanding RSUs may be settled by the issuance of common shares held as treasury shares. In line with the Company’s accounting policy, the compensation costs related to RSUs are expensed on a straight-line basis.

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~13. Equity-Based Compensation (Continued)~~

The table below presents the activity of the Company’s RSUs for the three months ended March 31, ~~2017:~~

(in dollars, except number of RSUs) Number
Weighted
Average
Grant Date
Fair Value

Balance as of January 1, 2017 1,395,307 $ 13.84
Granted at fair market value 691,502 $ 12.23
Vested(1) (18,968) $ 12.90
Forfeited (29,267) $ 13.63
Balance as of March 31, 2017 2,038,574 $ 13.31

2018:

				Weighted Average
				Grant Date
(in dollars, except number of RSUs)	Number			Fair Value
Balance as of January 1, 2018		1,526,280		$	13.01
Granted at fair market value		794,679		$	14.35
Vested⁽¹⁾		(36,259	)	$	13.07
Forfeited		(129,551	)	$	12.96
Balance as of March 31, 2018		2,155,149		$	13.50

(1)

During the three months ended March 31, 2018, the Company completed net share settlements of 17,445 common shares in connection with employee taxable income created upon vesting of RSUs. The Company agreed to pay these taxes on behalf of the employees in return for the employees returning an equivalent value of common shares. These common shares were accounted for as treasury shares by the Company.

~~(1)~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

Performance Share Units (“PSUs”)

During the three months ended March 31, 2017, the Company completed net share settlements of 8,916 common shares in connection with employee taxable income created upon vesting of RSUs. The Company agreed to pay these taxes on behalf of the employees in return for the employees returning an equivalent value of common shares. These common shares were accounted for as treasury shares by the Company.

~~Performance Share Units (“PSUs”)~~

~~During the three months ended March 31, 2017,~~2018, as part of its annual grant program, the Company granted ~~1,593,814~~1,246,803 PSUs. The PSUs cliff-vest at the end of approximately three years from the date of the grant based on the satisfaction of certain performance conditions and continued employment of the employee during the vesting period. The ultimate number of PSUs that will vest ~~will~~ also ~~depend~~depends on the Company’s ranking within a group of companies based on achievement of its total shareholder’s return (“TSR”) during the applicable performance period compared to the TSR of the companies within the selected group. However, the total number of PSUs that will ultimately vest will not exceed 200% of the original grant. Each reporting period, the Company assesses the probability of vesting, and, if there is any change in such probability, the Company records the cumulative effect of the adjustment in the current reporting period. All of the PSUs are settled in the Company’s common shares. PSUs accrue dividend equivalents associated with the underlying common shares as dividends are declared by the Company. Dividends will generally be paid to holders of PSUs in cash upon the vesting of the associated PSUs and will be forfeited should the PSUs not vest. The PSUs do not have an exercise price. For PSUs earned based on a market condition, the Company utilizes a Monte Carlo simulation to determine the fair value of these awards at the date of ~~grant, and such fair value is~~grant. Certain of the Company’s outstanding PSUs may be settled by the issuance of common shares held as treasury shares. In line with the Company’s accounting policy, the compensation costs related to the PSUs are expensed ~~over the vesting period of approximately three-year performance period~~ on a straight-line basis.

The table below presents the activity of the Company’s PSUs for the three months ended March 31, ~~2017:~~

(in dollars, except number of PSUs) Number
Weighted
Average
Grant Date
Fair Value

Balance as of January 1, 2017 2,641,227 $ 15.52
Granted at fair market value 1,689,700 $ 12.95
Forfeited (174,733) $ 13.40
Balance as of March 31, 2017(1)
4,156,194 $ 14.58

2018:

				Weighted Average
				Grant Date
(in dollars, except number of PSUs)	Number			Fair Value
Balance as of January 1, 2018		2,694,999		$	13.10
Granted at fair market value		1,444,522		$	16.33
Forfeited		(351,937	)	$	12.94
Balance as of March 31, 2018⁽¹⁾		3,787,584		$	14.32

~~(1)~~

~~Total estimated awards that will ultimately vest based on the Company’s forecasted performance against the pre-defined targets is expected to be 4,634,612 PSUs.~~

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~13. Equity-Based Compensation (Continued)~~

(1)

Total estimated awards that ultimately will vest based on the Company’s forecasted performance against the pre-defined targets and before considering any adjustments that may be necessary based on the ranking of the Company’s TSR compared to the TSR of the selected group is expected to be 4,350,925 PSUs.

Stock Options

During the three months ended March 31, 2018, the Company did not grant any stock options.

The table below presents the activity of the Company’s stock options for the three months ended March 31, ~~2017:~~

Number of Options Weighted Average
Exercise Price
(in dollars) Weighted Average
Remaining
Contractual
Terms
(in years) Aggregate
Intrinsic Value
(in $ thousands)
Balance as of January 1, 2017 2,720,514 $ 13.58
Forfeited (12,836) $ 13.65
Balance as of March 31, 2017 2,707,678 $ 13.58 7.66 $ 766
Exercisable as of March 31, 2017 755,986 $ 12.99 4.92 766
Expected to vest as of March 31, 2017 1,951,692 $ 13.81 8.72 —

2018:

						Weighted Average
				Weighted Average		Remaining		Aggregate
				Exercise Price		Contractual Terms		Intrinsic Value
	Number of Options			(in dollars)		(in years)		(in $ thousands)
Balance as of January 1, 2018		2,352,928		$	13.51
Forfeited		(107,410	)	$	13.55
Exercised		(290,160	)	$	9.92
Expired		(40,984	)	$	15.53
Balance as of March 31, 2018		1,914,374		$	14.01		7.24	$	4,506
Exercisable as of March 31, 2018		841,211		$	14.45		6.55	$	1,618
Expected to vest as of March 31, 2018		1,073,163		$	13.66		7.78	$	2,888

Total equity-based compensation expense recognized in the Company’s consolidated condensed statements of operations for the three months ended March 31, 2018 and 2017 was $5 million and ~~2016 was~~ $8 million ~~and $9 million~~ ($74 million and $8$7 million after tax), respectively. The total income tax benefit related to equity-based compensation expense was $1 million for each of the three months ended March 31, ~~2017~~2018 and ~~2016.~~

2017.

The Company expects the future equity-based compensation expense in relation to awards ~~recognized for accounting purposes as being~~ granted as of March 31, ~~2017~~2018 will be approximately ~~$71~~$73 million.

~~14.~~

TRAVELPORT WORLDWIDE LIMITED

NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(unaudited)

16. Income Per Share

The following table reconciles the numerators and denominators used in the computation of basic and diluted income per ~~share:~~

Three Months Ended March 31,
(in $ thousands, except for share data) 2017 2016
Numerator – Basic and Diluted Income per Share:
Net income attributable to the Company $ 56,106 $ 16,585
Denominator – Basic Income per Share:
Weighted average common shares outstanding 124,081,175 123,718,311
Income per share – Basic $ 0.45 $ 0.13
Denominator – Diluted Income per Share:
Number of common shares used for basic income per share 124,081,175 123,718,311
Weighted average effect of dilutive securities
RSUs / PSUs 1,342,130 —
Stock Options 93,640 60,096
Weighted average common shares outstanding 125,516,945 123,778,407
Income per share – Diluted $ 0.45 $ 0.13

share from continuing operations:

	Three Months Ended March 31,
(in $ thousands, except for share data)	2018			2017
Numerator – Basic and Diluted Income per Share:
Net income from continuing operations	$	31,484		$	55,863
Net (income) loss attributable to non-controlling interest in subsidiaries		(402	)		243
Net income from continuing operations attributable to the Company	$	31,082		$	56,106
Denominator – Basic Income per Share:
Weighted average common shares outstanding		125,428,257			124,081,175
Income per share from continuing operations – Basic	$	0.25		$	0.45

Denominator – Diluted Income per Share:
Number of common shares used for basic income per share from continuing operations		125,428,257			124,081,175
Weighted average effect of dilutive securities
RSUs / PSUs		604,051			1,342,130
Stock options		98,893			93,640
Weighted average common shares outstanding		126,131,201			125,516,945
Income per share from continuing operations – Diluted	$	0.25		$	0.45

Basic income per share is based on the weighted average number of common shares outstanding during each period. Diluted income per share is based on the weighted average number of common shares outstanding and the effect of all dilutive common share equivalents during each period.

~~TABLE OF CONTENTS~~

~~TRAVELPORT WORLDWIDE LIMITED~~

~~NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS~~
~~(unaudited)~~

~~14. Income Per Share (Continued)~~

For each of the three months ended March 31, 2018 and 2017, the Company had 2 million of weighted average common share equivalents, primarily associated with the Company’s stock options, that were excluded from the calculation of diluted income per share from continuing operations as their inclusion would have been antidilutive as the number of common shares repurchased from the total assumed proceeds applying the treasury stock method exceed the number of common shares that would have been issued.

~~15.~~

17. Discontinued Operations

In connection with the sale of the Gullivers Travel Associates business to Kuoni in 2011, the Company agreed to indemnify Kuoni through January 2018 for certain potential liabilities relating to pre-sale events. As no further obligations arose under the indemnity, the Company released the remaining balance of the indemnity provision of $28 million during the three months ended March 31, 2018, which is included within income from discontinued operations, net of tax, in the consolidated condensed statements of operations.

18. Subsequent Events

On May ~~5, 2017,~~2, 2018, the Company’s Board of Directors declared a cash dividend of $0.075 per common share for the first quarter of ~~2017,~~2018, which is payable on June ~~15, 2017~~21, 2018 to shareholders of record on June ~~1, 2017.~~

7, 2018.

~~TABLE OF CONTENTS~~

ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our results of operations and financial condition for the three months ended March 31, ~~2017~~2018 should be read in conjunction with our consolidated condensed financial statements and accompanying notes thereto included elsewhere in this Quarterly Report on Form 10-Q. The following discussion and analysis includes forward-looking statements that reflect the current view of management and involve risks and uncertainties. Our actual results may differ materially from those contained in any forward-looking statements as a result of factors discussed below and elsewhere in this Quarterly Report, particularly under the headings “Risk Factors” and “Forward-Looking Statements.”

Overview

We are a leading travel commerce platform providing distribution, technology, payment, mobile and other solutions for the global travel and tourism industry. We facilitate travel commerce by connecting the world’s leading travel providers, such as airlines, ~~and~~ hotel chains and car rental companies, with online and offline travel ~~agencies and other travel~~ buyers in our proprietary ~~business-to-business (“B2B”)~~B2B travel commerce ~~platform (our Travel Commerce Platform).~~platform. In ~~2016,~~2017, we processed approximately ~~$79~~$83 billion of travel spending. ~~Since 2012, we have~~We continue to strategically ~~invested~~invest in products with a focus on redefining our Travel Commerce Platform to address the trends, inefficiencies and unmet needs of all components of the travel value chain.

We have one reporting segment, and we further classify revenue according to its source as either Travel Commerce Platform revenue (comprised of Air and Beyond Air) or Technology Services revenue. For the three months ended March 31, ~~2017,~~2018, Air, Beyond Air and Technology Services represented ~~73%~~approximately 70%, ~~23%~~26% and 4%, respectively, of our net revenue.

Travel Commerce Platform

Our Travel Commerce Platform combines state-of-the-art technology with features, functionality and innovative solutions to address the high-volume and growing transaction processing requirements for the evolving needs of the travel industry.

Air

We provide comprehensive real-time search, pricing, booking, change, payment and integrated itinerary creation for travelers who use the services of online and offline travel agencies for both leisure and business travel. We provide such services to approximately 400 airlines globally, including approximately 125 low cost carriers (“LCCs”). Our access to business travelers, merchandising capabilities and ability to process complex itineraries have attracted and allowed for the full integration of several fast-growing LCCs such as AirAsia, easyJet, IndiGo and Ryanair into our Travel Commerce Platform.

Beyond Air

We have expanded our Travel Commerce Platform with a fast growing portfolio of Beyond Air initiatives. Our Beyond Air portfolio includes hospitality, payment solutions, digital services, advertising and other platform services.

For the hospitality sector of the travel industry, we provide innovative distribution and merchandising solutions for hotel, car rental, rail, cruise-line and tour operators.

For payment solutions, eNett International (Jersey) Limited’s (“eNett”) core offering is a Virtual Account Number (“VAN”) that automatically generates unique Mastercard numbers used to process payments globally. eNett’s operations currently focus on Asia Pacific and Europe, and we believe the model is highly scalable. During the three months ended March 31, ~~2017,~~2018, eNett generated net revenue of ~~$41~~$74 million, representing an approximately ~~22%~~81% increase compared to the three months ended March 31, ~~2016.~~

2017.

We also provide a mobile travel platform and digital product set that allows airlines, hotels, corporate travel management companies and travel agencies to engage with their customers through mobile services, including apps, mobile web and mobile messaging.

~~TABLE OF CONTENTS~~

In addition to hospitality, payment solutions and digital services, we utilize the broad connections and extensive data managed by our Travel Commerce Platform to provide advertising solutions to over 3,000 advertisers that allow our travel providers to easily and cost-effectively promote upgrades, ancillary products or services, package deals and other offers. We also offer other platform services, including subscription services, processing services, business intelligence data services and marketing-oriented analytical tools, to travel agencies, travel providers and other travel data users.

Technology Services

We provide critical hosting ~~solutions~~services to airlines, such as ~~pricing,~~ shopping, ticketing, ~~ground handling~~departure control, business intelligence and other ~~services,~~solutions, enabling them to focus on their core business competencies and reduce costs. We also host reservations, inventory management and other related critical systems for Delta Air Lines Inc.

Management Performance Metrics

Our management ~~team~~ monitors the performance of our operations against our strategic objectives. We assess our performance using both financial and non-financial measures. As a Travel Commerce Platform, we measure performance primarily on the basis of changes in both Reported Segments and RevPas. Travel Commerce Platform RevPas is computed by dividing Travel Commerce Platform revenue by the total number of Reported Segments. Travel Commerce Platform revenue is generated from a wide portfolio of products and services, including traditional air bookings, ancillaries, hospitality, payment solutions, digital services, advertising and other platform services. Reported Segments is defined as travel provider revenue generating units (net of cancellations) sold by our travel agency network, geographically presented by region based upon the point of sale location. We also use other GAAP and non-GAAP measures as performance metrics.

The table below sets forth our performance metrics:

Three Months
Ended March 31, Change
(in $ thousands, except share data, Reported Segments and RevPas) 2017 2016 %
Net revenue $ 650,763 $ 609,263 $ 41,500 7
Operating income 98,870 79,868 19,002 24
Net income 55,863 17,181 38,682 *
Income per share – diluted (in $) 0.45 0.13 0.32 *
Adjusted EBITDA(1)
168,553 154,140 14,413 9
Adjusted Operating Income(2)
107,241 96,464 10,777 11
Adjusted Net Income(3)
64,357 50,955 13,402 26
Adjusted Income per Share – diluted(4) (in $)
0.51 0.41 0.10 24
Net cash provided by operating activities 95,022 26,204 68,818 *
Free Cash Flow(5)
71,413 3,683 67,730 *
Reported Segments (in thousands) 93,197 89,973 3,224 4
Travel Commerce Platform RevPas (in $) 6.67 6.43 0.24 4

	Three Months
	Ended March 31,				Change
(in $ thousands, except share data, Reported Segments and RevPas)	2018		2017		$			%
Net revenue	$	677,838	$	650,763		27,075			4
Operating income		77,664		99,716		(22,052	)		(22	)
Net income		59,231		55,863		3,368			6
Income per share – diluted (in $)		0.47		0.45		0.02			4
Adjusted EBITDA⁽¹⁾		154,177		168,553		(14,376	)		(9	)
Adjusted Operating Income⁽²⁾		93,436		107,241		(13,805	)		(13	)
Adjusted Net Income⁽³⁾		54,938		64,357		(9,419	)		(15	)
Adjusted Income per Share – diluted⁽⁴⁾ (in $)		0.44		0.51		(0.07	)		(15	)
Net cash provided by operating activities		83,097		95,022		(11,925	)		(13	)
Free Cash Flow⁽⁵⁾		46,434		71,413		(24,979	)		(35	)
Reported Segments (in thousands)		92,321		93,197		(876	)		(1	)
Travel Commerce Platform RevPas (in $)		7.07		6.67		0.40			6

Percentage calculated not meaningful

(1)

Adjusted EBITDA is defined as Adjusted Net Income (Loss) excluding depreciation and amortization of property and equipment, amortization of customer loyalty payments, interest expense, net (excluding unrealized gains (losses) on interest rate derivative instruments) and related income taxes.

(2)

Adjusted Operating Income (Loss) is defined as Adjusted EBITDA less depreciation and amortization of property and equipment, amortization of customer loyalty payments and components of net periodic pension and post-retirement benefit costs other than service cost.

(3)

Adjusted Net Income (Loss) is defined as net income (loss) excluding amortization of acquired intangible assets, gain (loss) on early extinguishment of debt, and items that are excluded under our debt covenants, such as income (loss) from discontinued operations, non-cash equity-based compensation, certain corporate and restructuring costs, non-cash impairment of long-lived assets, certain litigation and related costs and other non-cash items such as unrealized foreign currency gains (losses) on earnings hedges, and unrealized gains (losses) on interest rate derivative instruments, along with any income tax related to these exclusions. Tax impacts not related to core operations have also been excluded (see Note 4—Income Taxes to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q).

(4)

Adjusted Income (Loss) per Share—diluted is defined as Adjusted Net Income (Loss) for the period divided by the weighted average number of dilutive common shares.

(5)

Free Cash Flow is defined as net cash provided by (used in) operating activities of continuing operations, less cash used for additions to property and equipment.

~~Percentage calculated not meaningful~~

~~(1)~~

~~(2)~~

~~Adjusted Operating Income (Loss) is defined as Adjusted EBITDA less depreciation and amortization of property and equipment and amortization of customer loyalty payments.~~

~~(3)~~

Adjusted Net Income (Loss) is defined as net income (loss) from continuing operations excluding amortization of acquired intangible assets, gain (loss) on early extinguishment of debt, and items that are excluded under our debt covenants, such as non-cash equity-based compensation, certain corporate

~~TABLE OF CONTENTS~~

and restructuring costs, non-cash impairment of long-lived assets, certain litigation and related costs and other non-cash items such as unrealized foreign currency gains (losses) on earnings hedges, and unrealized gains (losses) on interest rate derivative instruments, along with any income tax related to these exclusions.

~~(4)~~

~~Adjusted Income (Loss) per Share—diluted is defined as Adjusted Net Income (Loss) for the period divided by the weighted average number of dilutive common shares.~~

~~(5)~~

~~Free Cash Flow is defined as net cash provided by (used in) operating activities of continuing operations, less cash used for additions to property and equipment.~~

We utilize non-GAAP (or adjusted) financial measures, including Adjusted EBITDA, Adjusted Operating Income (Loss), Adjusted Net Income (Loss) and Adjusted Net Income (Loss) per Share—diluted, to provide useful supplemental information to assist investors in understanding and assessing our performance and financial results on the same basis that management uses internally. These adjusted financial measures provide investors greater transparency with respect to key metrics used by management to evaluate our core operations, forecast future results, determine future capital investment allocations and understand business trends within the industry. ~~These~~Adjusted Operating Income (Loss) and Adjusted Net Income (Loss) per Share—diluted metrics are also used by our Board of Directors to determine incentive compensation for future periods. Management believes the adjusted financial measures assist investors in the comparison of financial results between periods as such measures exclude certain items that management believes are not reflective of our core operating performance consistent with how management reviews the business.

Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Share—diluted, Adjusted Operating Income (Loss) and Adjusted EBITDA are supplemental measures of operating performance that do not represent, and should not be considered as, alternatives to net income (loss) or net income (loss) per share—diluted, as determined under U.S. GAAP. In addition, these measures may not be comparable to similarly named measures used by other companies. The presentation of these measures has limitations as analytical tools, and should not be considered in isolation or as a substitute for analysis of our results as reported under U.S. GAAP.

The following table provides a reconciliation of net income to Adjusted Net Income, to Adjusted Operating Income and to Adjusted EBITDA:

Three Months Ended
March 31,
(in $ thousands) 2017 2016
Net income $ 55,863 $ 17,181
Adjustments:
Amortization of intangible assets(1)
10,392 11,139
Equity-based compensation and related taxes 7,786 9,101
Corporate and restructuring costs(2)
5,656 7,409
Impairment of long-lived assets(3)
685 461
Other – non cash(4)
(16,374) 4,942
Tax impact of adjustments(5)
349 722
Adjusted Net Income 64,357 50,955
Adjustments:
Interest expense, net(6)
30,501 38,439
Remaining provision for income taxes 12,383 7,070
Adjusted Operating Income 107,241 96,464
Adjustments:
Depreciation and amortization of property and equipment 42,517 41,102
Amortization of customer loyalty payments 18,795 16,574
Adjusted EBITDA $ 168,553 $ 154,140

	Three Months Ended
	March 31,
(in $ thousands)	2018			2017
Net income	$	59,231		$	55,863
Adjustments:
Amortization of acquired intangible assets⁽¹⁾		10,166			10,392
Loss on early extinguishment of debt		27,661			—
Equity-based compensation and related taxes		4,833			7,786
Corporate and restructuring costs⁽²⁾		1,215			5,656
Impairment of long-lived assets⁽³⁾		491			685
Income from discontinued operations		(27,747	)		—
Other – non cash⁽⁴⁾		(11,363	)		(16,374	)
Tax adjustments⁽⁵⁾		(9,549	)		349
Adjusted Net Income		54,938			64,357
Adjustments:
Interest expense, net⁽⁶⁾		25,365			30,501
Other expense⁽⁷⁾		93			—
Remaining provision for income taxes		13,040			12,383
Adjusted Operating Income		93,436			107,241
Adjustments:
Depreciation and amortization of property and equipment		38,398			42,517
Amortization of customer loyalty payments		22,343			18,795
Adjusted EBITDA	$	154,177		$	168,553

(1)

Relates primarily to intangible assets acquired in the sale of Travelport to The Blackstone Group in 2006 and from the acquisition of Worldspan in 2007.

(2)

Relates to costs associated with corporate development transactions and costs incurred to enhance our organization’s efficiency, including restructuring activity (see Note 9—Restructuring Charges to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q).

~~(1)~~

~~Relates primarily to intangible assets acquired in the sale of Travelport to The Blackstone Group in 2006 and from the acquisition of Worldspan in 2007.~~

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~~(2)~~

Relates to costs associated with corporate development transactions and costs incurred to enhance our organization’s efficiency, including restructuring activity (see Note 7—Restructuring Charges to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q).

~~(3)~~

~~Impairment of long-lived assets relate to capitalized software.~~

~~(4)~~

Other—non cash includes (i) unrealized gains on foreign currency derivatives contracts of $8 million and $11 million for the three months ended March 31, 2017 and 2016, respectively, (ii) unrealized (gains) losses on interest rate derivative contracts of less than $(1) million and $16 million for the three months ended March 31, 2017 and 2016, respectively, (iii) $8 million related to revenue deferred in previous years, for the three months ended March 31, 2017 and (iv) other gains of $1 million for the three months ended March 31, 2017.

~~(5)~~

Tax impact of adjustments primarily relates to equity-based compensation, corporate and restructuring costs and unrealized gains and losses on foreign currency derivative contracts and is calculated at the rate applicable for the jurisdiction in which the adjusting item arose.

~~(6)~~

Interest expense, net, excludes the impact of unrealized (gains) losses of less than $(1) million and $16 million on interest rate derivative contracts for the three months ended March 31, 2017 and 2016, respectively, which is included within “Other—non cash.”

(3)

Relates to the impairment of property and equipment and customer loyalty payments.

(4)

Includes (i) unrealized gains on foreign currency derivatives contracts of $1 million and $8 million for the three months ended March 31, 2018 and 2017, respectively, (ii) unrealized gains on interest rate derivative contracts of $10 million and less than $1 million for the three months ended March 31, 2018 and 2017, respectively, (iii) $8 million related to revenue deferred in previous years for the three months ended March 31, 2017 and (iv) other gains of $1 million for the three months ended March 31, 2017.

(5)

Relates primarily to the tax impact of the loss on early extinguishment of debt, equity-based compensation, corporate and restructuring costs and unrealized gains and losses on foreign currency derivative contracts that are excluded from net income to determine Adjusted Net Income tax adjustments are calculated at the rate applicable for the jurisdiction in which the adjusting item arose. The adjustments also include the benefit realized following the release of a portion of the valuation allowance on deferred tax assets associated with U.K. net operating losses carry forwards (see Note 4—Income Taxes to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q).

(6)

Excludes the impact of unrealized gains on interest rate derivative of $10 million and less than $1 million for the three months ended March 31, 2018 and 2017, respectively, which is included within “Other—non-cash.”

(7)

Relates to interest costs, expected return on plan assets and amortization of actuarial gain or loss components of net periodic pension and post-retirement benefit costs, which we consider to be non-operating components, to be excluded from Adjusted Operating Income and Adjusted EBITDA starting January 1, 2018 on a prospective basis.

The following table provides a reconciliation of income per share—diluted to Adjusted Income per Share—diluted:

Three Months Ended
March 31,
2017 2016
Income per share – diluted $ 0.45 $ 0.13
Per share adjustments to net income to determine Adjusted Income per Share – diluted 0.06 0.28
Adjusted Income per Share – diluted $ 0.51 $ 0.41

	Three Months Ended
	March 31,
(in $)	2018			2017
Income per share – diluted	$	0.47		$	0.45
Per share adjustments to net income to determine Adjusted Income per Share – diluted		(0.03	)		0.06
Adjusted Income per Share – diluted	$	0.44		$	0.51

We have included Adjusted Income (Loss) per Share—diluted as we believe it is a useful measure for our investors as it represents, on a per share basis, our consolidated results, taking into account depreciation and amortization on property and equipment and amortization of customer loyalty payments, as well as other items which are not allocated to the operating businesses such as interest expense (excluding unrealized gains (losses) on interest rate derivative instruments), certain components of net periodic pension and post-retirement benefit costs and related income taxes but excluding the effects of certain expenses not directly tied to the core operations of our businesses. Adjusted Income (Loss) per Share—diluted has similar limitations as Adjusted Net Income (Loss), Adjusted Operating Income (Loss) and Adjusted EBITDA and may not be comparable to similarly named measures used by other companies. In addition, Adjusted Net Income (Loss) does not include all items that affect our net income (loss) and net income (loss) per share for the period. Therefore, it is important to evaluate these measures along with our consolidated condensed statements of operations.

For a discussion of Free Cash Flow, please see “Liquidity and Capital Resources—Cash Flows.”

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Factors Affecting Results of Operations

Geographic Mix: Our geographically dispersed footprint helps insulate us from a particular country or regional instability, allows for optimal information technology efficiency and enhances our value proposition to travel providers. We are well positioned to capture higher value business from travel providers operating in away markets, which results in higher per transaction revenue for both us and the travel providers we serve. The table below sets forth revenue by region percentages for our Travel Commerce Platform for the three months ended March 31, ~~2017~~2018 and ~~2016:~~

Three Months Ended
March 31,
(in percentages) 2017 2016
Asia Pacific 24 22
Europe 33 33
Latin America and Canada 5 5
Middle East and Africa 13 13
International 75 73
United States 25 27
Travel Commerce Platform 100 100

2017:

	Three Months Ended
	March 31,
(in percentages)	2018		2017
Asia Pacific		22		24
Europe		37		33
Latin America and Canada		5		5
Middle East and Africa		12		13
International		76		75
United States		24		25
Travel Commerce Platform		100		100

We expect some of the regions in which we currently operate, such as Asia Pacific, the Middle East and Africa, to experience growth in travel that is greater than the global average due to factors such as economic growth and a growing middle class, while more mature regions, such as the United States, remain stable. As these emerging travel regions may grow at a higher rate than mature regions, the geographic distribution of our revenue may similarly shift.

Customer Mix: We believe our customer mix is broadly diversified, supporting our stable and recurring business model with high revenue visibility. We provide air distribution services to approximately 400 airlines globally, including approximately 125 LCCs. In addition, we serve numerous Beyond Air travel providers, including approximately 650,000 hotel properties (of which over 500,000 are independent hotel properties), over ~~37,000~~38,000 car rental locations, ~~over~~approximately 50 cruise-line and tour operators and 1413 major rail networks worldwide. We aggregate travel content across approximately ~~68,000~~65,000 travel agency locations representing ~~over 234,000~~approximately 230,000 online and offline travel agency terminals worldwide, which in turn serves millions of end customers globally. None of our travel buyers or travel providers accounted for more than 10% of our revenue for the three months ended March 31, ~~2017.~~

2018.

Seasonality: Our revenue can experience seasonal fluctuations, reflecting seasonal demand trends for the products and services we offer. These trends generally cause our revenue to be higher in the first and second quarters as compared to the third and fourth quarters of the calendar year. Revenue typically peaks during the first two quarters of the year as travelers plan and purchase their upcoming spring and summer travel.

Foreign Exchange Fluctuations:We are exposed to movements in currency exchange rates that impact our operating results. While substantially all of our revenue is denominated in U.S. dollars, a portion of our operating cost base, primarily commissions, is transacted in non-U.S. dollar currencies (principally, the British pound, Euro and Australian dollar).

Litigation and Related Costs:We are involved in various claims, legal proceedings and governmental inquiries related to contract disputes, business practices, intellectual property and other commercial, employment and tax matters. We believe we have adequately accrued for such matters, and for costs of defending against such matters. However, litigation is inherently unpredictable and although we believe that our accruals are adequate and we have valid defenses in these matters, unfavorable resolutions could occur, which could have a material adverse effect on our results of operations or cash flows in a particular reporting period.

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Results of Operations

Three Months Ended March 31, ~~2017~~2018 Compared to Three Months Ended March 31, ~~2016~~

Three Months Ended
March 31, Change
(in $ thousands) 2017 2016 $ %
Net revenue $ 650,763 $ 609,263 $ 41,500 7
Costs and expenses
Cost of revenue 386,837 362,677 24,160 7
Selling, general and administrative 112,147 114,477 (2,330) (2)
Depreciation and amortization 52,909 52,241 668 1
Total costs and expenses 551,893 529,395 22,498 4
Operating income 98,870 79,868 19,002 24
Interest expense, net (30,275) (54,895) 24,620 45
Income before income taxes 68,595 24,973 43,622 175
Provision for income taxes (12,732) (7,792) (4,940) (63)
Net income $ 55,863 $ 17,181 $ 38,682 *

2017

We have adopted new guidance on pension costs from January 1, 2018 (see Note 2—Recently Issued Accounting Pronouncements—Pension to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q). In accordance with the guidance, we have presented interest costs, expected return on plan assets and amortization of actuarial gain or loss components of net periodic pension and post-retirement benefit costs separately outside of operating income. For the three months ended March 31, 2017, we reclassified $1 million from selling, general and administrative expense to other expense within the consolidated condensed statement of operations.

	Three Months Ended
	March 31,						Change
(in $ thousands, except share data)	2018			2017			$			%
Net revenue	$	677,838		$	650,763		$	27,075			4
Costs and expenses
Cost of revenue		426,397			386,837			39,560			10
Selling, general and administrative		125,200			111,301			13,899			12
Depreciation and amortization		48,577			52,909			(4,332	)		(8	)
Total costs and expenses		600,174			551,047			49,127			9
Operating income		77,664			99,716			(22,052	)		(22	)
Interest expense, net		(14,935	)		(30,275	)		15,340			51
Loss on early extinguishment of debt		(27,661	)		—			(27,661	)		*
Other expense		(93	)		(846	)		753			89
Income before income taxes		34,975			68,595			(33,620	)		(49	)
Provision for income taxes		(3,491	)		(12,732	)		9,241			73
Net income from continuing operations		31,484			55,863			(24,379	)		(44	)
Income from discontinued operations, net of tax		27,747			—			27,747			*
Net income	$	59,231		$	55,863		$	3,368			6

~~Percentage calculated not meaningful~~

Percentage calculated not meaningful

Net Revenue

On January 1, 2018, we adopted new guidance on revenue recognition applying the modified retrospective method to all contracts. Results for the three months ended March 31, 2018 are presented under the new revenue recognition guidance, while prior period amounts are not adjusted and continue to be reported in accordance with the historic accounting under previous revenue recognition guidance. We recorded a reduction of $1 million to our accumulated deficit balance as of January 1, 2018, representing the cumulative impact of adopting the new revenue recognition guidance, which primarily relates to the timing of recognition of hotel reservations in our Beyond Air revenue. The impact to net revenue for the quarter ended March 31, 2018 was a decrease of less than $1 million as a result of applying the new revenue recognition guidance (see Note 3–Revenue to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q).

Net revenue is comprised of:

Three Months Ended
March 31, Change
(in $ thousands ) 2017 2016 $ %
Air $ 474,475 $ 443,884 $ 30,591 7
Beyond Air 147,585 135,002 12,583 9
Travel Commerce Platform 622,060 578,886 43,174 7
Technology Services 28,703 30,377 (1,674) (6)
Net revenue $ 650,763 $ 609,263 $ 41,500 7

	Three Months Ended
	March 31,				Change
(in $ thousands)	2018		2017		$			%
Air	$	472,935	$	474,475	$	(1,540	)		—
Beyond Air		179,751		147,585		32,166			22
Travel Commerce Platform		652,686		622,060		30,626			5
Technology Services		25,152		28,703		(3,551	)		(12	)
Net revenue	$	677,838	$	650,763	$	27,075			4

During the three months ended March 31, ~~2017,~~2018, net revenue increased by ~~$42~~$27 million, or 7%4%, compared to the three months ended March 31, ~~2016.~~2017. This increase was primarily driven by an increase in Travel Commerce Platform revenue of ~~$43~~$31 million, or 7%5%, offset by a decrease in Technology Services revenue of $4 million, or 12%.

Travel Commerce Platform

The table below sets forth Travel Commerce Platform RevPas and Reported Segments:

Three Months Ended
March 31, Change
2017 2016 $ %
Travel Commerce Platform RevPas (in $) $ 6.67 $ 6.43 $ 0.24 4
Reported Segments (in thousands) 93,197 89,973 3,224 4

	Three Months Ended
	March 31,				Change
	2018		2017					%
Travel Commerce Platform RevPas (in $)	$	7.07	$	6.67	$	0.40			6
Reported Segments (in thousands)		92,321		93,197		(876	)		(1	)

The increase in Travel Commerce Platform revenue of ~~$43~~$31 million, or 7%5%, was due to a ~~$31~~$32 million, or ~~7%, increase in Air revenue and a $13 million, or 9%~~22%, increase in Beyond Air revenue, offset by a $2 million decrease in Air revenue. Overall, there was a 4%6% increase in Travel Commerce Platform RevPas and a ~~4% increase~~1% decrease in Reported Segments.

Our Travel Commerce Platform continues to benefit from growth in ~~Air revenue and~~ Beyond Air revenue. The value of transactions processed on our Travel Commerce Platform increased to $23.3 billion for the three months ended March 31, 2018 from $20.6 billion for the three months ended March 31, 2017 ~~from $20.1 billion for the three months ended March 31, 2016~~

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primarily due to an increase in the value and volume of transactions in payment ~~solutions.~~solutions and increase in ticket prices in line with global trends. Our percentage of Air segment revenue from away bookings ~~decreased~~increased to ~~67%~~69% from ~~68%~~67%. Our hospitality segments per 100 airline tickets issued ~~decreased to 41 from 43. This is primarily due to higher growth in airline tickets issued compared to growth in hospitality segments.~~remained stable at 41. Our hotel room nights and car rental days sold grew by 4%2% and 1%11%, respectively, and were 1617 million and 2225 million, respectively, for the three months ended March 31, ~~2017.~~

2018.

The table below sets forth Travel Commerce Platform revenue by region:

Three Months Ended
March 31, Change
(in $ thousands) 2017 2016 $ %
Asia Pacific $ 151,015 $ 128,495 $ 22,520 18
Europe 202,416 194,847 7,569 4
Latin America and Canada 28,782 28,036 746 3
Middle East and Africa 83,553 73,450 10,103 14
International 465,766 424,828 40,938 10
United States 156,294 154,058 2,236 1
Travel Commerce Platform $ 622,060 $ 578,886 $ 43,174 7

	Three Months Ended
	March 31,				Change
(in $ thousands)	2018		2017		$			%
Asia Pacific	$	141,551	$	151,015	$	(9,464	)		(6	)
Europe		244,442		202,416		42,026			21
Latin America and Canada		29,859		28,782		1,077			4
Middle East and Africa		79,106		83,553		(4,447	)		(5	)
International		494,958		465,766		29,192			6
United States		157,728		156,294		1,434			1
Travel Commerce Platform	$	652,686	$	622,060	$	30,626			5

The table below sets forth Reported Segments and RevPas by region:

Segments (in thousands)

RevPas (in $)

Three Months Ended
March 31, Change Three Months Ended
March 31, Change
2017 2016 % 2017 2016 $ %
Asia Pacific 19,208 16,989 2,219 13 $ 7.86 $ 7.56 $ 0.30 4
Europe 23,497 23,133 364 2 $ 8.61 $ 8.42 $ 0.19 2
Latin America and Canada 4,626 4,550 76 2 $ 6.22 $ 6.16 $ 0.06 1
Middle East and Africa 9,476 9,721 (245) (3) $ 8.82 $ 7.56 $ 1.26 17
International 56,807 54,393 2,414 4 $ 8.20 $ 7.81 $ 0.39 5
United States 36,390 35,580 810 2 $ 4.30 $ 4.33 $ (0.03) (1)
Travel Commerce Platform 93,197 89,973 3,224 4 $ 6.67 $ 6.43 $ 0.24 4

	Segments(in thousands)										RevPas(in $)
	Three Months Ended										Three Months Ended
	March 31,				Change						March 31,				Change
	2018		2017					%			2018		2017		$			%
Asia Pacific		16,168		19,208		(3,040	)		(16	)	$	8.76	$	7.86		0.90			11
Europe		25,647		23,497		2,150			9		$	9.53	$	8.61		0.92			11
Latin America and Canada		4,710		4,626		84			2		$	6.34	$	6.22		0.12			2
Middle East and Africa		9,628		9,476		152			2		$	8.22	$	8.82		(0.60	)		(7	)
International		56,153		56,807		(654	)		(1	)	$	8.81	$	8.20		0.61			8
United States		36,168		36,390		(222	)		(1	)	$	4.36	$	4.30		0.06			1
Travel Commerce Platform		92,321		93,197		(876	)		(1	)	$	7.07	$	6.67		0.40			6

~~International~~

International

Our International Travel Commerce Platform revenue increased ~~$41~~by $29 million, or ~~10%~~6%, due to ~~a 5%~~an 8% increase in RevPas ~~and~~offset by a ~~4% increase~~1% decrease in Reported Segments. The increase in RevPas was a result of growth in ~~our Air and~~payment solutions in Beyond Air, ~~offerings.~~partially offset by a decrease in Air. The ~~increase~~decrease in Air was mainly due to ~~improved pricing,~~the loss of a large travel agency in the Pacific region, mix and a $9 million recognition of revenue in 2017 in respect of revenue deferred in previous ~~years. The increase in Beyond Air was primarily driven~~years, partially offset by ~~growth in payment solutions and digital services.~~improved pricing. Our International Travel Commerce Platform revenue as a percentage of Travel Commerce Platform revenue was 76% for the three months ended March 31, 2018 compared to 75% for the three months ended March 31, ~~2017 compared to 73% for the three months ended March 31, 2016.~~

2017.

Asia Pacific

Revenue in Asia Pacific ~~increased $23~~decreased $9 million, or ~~18%~~6%, mainly due to a 4%16% decrease in Reported Segments offset by an 11% increase in RevPas. Reported Segments decreased due to loss of a large travel agency in the Pacific region, partially offset by growth in India. RevPas increased due to growth in payment solutions in Beyond Air.

Europe

Revenue in Europe increased $42 million, or 21%, primarily due to an 11% increase in RevPas and a ~~13%~~9% increase in Reported Segments. RevPas increased due to revenue growth in Air and growth in payment solutions in Beyond Air. Reported Segments increased ~~due to growth in Australia, India and Hong Kong.~~

~~Europe~~

Revenue in Europe increased $8 million, or 4%, primarily due to a 2% increase in RevPas and a 2% increase in Reported Segments. RevPas increased due to revenue growth in Air and growth in digital services and payment solutions in Beyond Air. Reported Segments increased mainly due to growth in ~~Russia, France~~Greece, United Kingdom and ~~Finland partially offset by a decline in the United Kingdom.~~

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Netherlands.

Latin America and Canada

Revenue in Latin America and Canada increased marginally by $1 million, or 3%4%. ~~The increase in net revenue in Latin America was partially offset by a decline in net revenue in Canada.~~

Middle East and Africa

Revenue in the Middle East and Africa ~~increased $10~~decreased $4 million or ~~14%~~5%, due to a ~~17% increase~~7% decrease in RevPas offset by a ~~3% decrease~~2% increase in Reported Segments. The ~~increase~~decrease in RevPas was mainly due to a $9 million recognition in 2017 of revenue deferred in previous years.

United States

Revenue in the United States increased $2marginally by $1 million.

Technology Services

Technology Services revenue decreased $4 million, or 1%12%, primarily due to ~~a 2% increase~~the sale of IGT Solutions Private Ltd (“IGTS”) in ~~Reported Segments, offset by a 1% decrease in RevPas.~~

~~Technology Services~~

~~Technology Services revenue decreased $2 million, or 6%, primarily due to a reduction in development and hosting solutions revenue.~~

2017.

Cost of Revenue

Cost of revenue is comprised of:

Three Months Ended
March 31, Change
(in $ thousands) 2017 2016 $ %
Commissions $ 302,789 $ 282,042 $ 20,747 7
Technology costs 84,048 80,635 3,413 4
Cost of revenue $ 386,837 $ 362,677 $ 24,160 7

	Three Months Ended
	March 31,				Change
(in $ thousands)	2018		2017		$			%
Commissions	$	349,951	$	302,789	$	47,162			16
Technology costs		76,446		84,048		(7,602	)		(9	)
Cost of revenue	$	426,397	$	386,837	$	39,560			10

Cost of revenue increased by ~~$24~~$40 million, or 7%10%, as a result of a ~~$21~~$47 million, or 7%16%, increase in commission costs and ~~a $3~~an $8 million, or 4%9%, ~~increase~~decrease in technology costs. Commissions increased primarily due to ~~a 2% increase in travel distribution costs per segment, primarily driven by mix and pricing and~~ incremental commission costs from our payment solutions business and ~~a 4%~~an 8% increase in ~~Reported Segments. This increase was partially offset~~travel distribution costs per segment driven by ~~a reduction in commissions resulting from our acquisition of our distributor in Japan~~pricing, mix and ~~favorable~~unfavorable foreign ~~currency~~ exchange ~~movement.~~movements. Commissions include amortization of customer loyalty payments of $20 million and $17 million for ~~each of~~ the three months ended March 31, 2018 and 2017, ~~and 2016.~~respectively. Technology costs across the shared infrastructure that runs our Travel Commerce Platform and Technology Services ~~increased~~decreased by $8 million, or 9%, due to ~~continued expansion~~reduced costs resulting from the sale of ~~our operations through acquisitions~~IGTS in April 2017 and ~~further investments in technology.~~higher capitalization of technology investments.

Selling, General and Administrative (SG&A)

SG&A is comprised of:

Three Months Ended
March 31, Change
(in $ thousands) 2017 2016 $ %
Workforce $ 85,375 $ 84,571 $ 804 1
Non-workforce 21,182 24,449 (3,267) (13)
Sub-total 106,557 109,020 (2,463) (2)
Non-core corporate costs 5,590 5,457 133 2
SG&A $ 112,147 $ 114,477 $ (2,330) (2)

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	Three Months Ended
	March 31,				Change
(in $ thousands)	2018		2017		$			%
Workforce	$	103,333	$	84,529	$	18,804			22
Non-workforce		16,510		21,182		(4,672	)		(22	)
Sub-total		119,843		105,711		14,132			13
Non-core corporate costs		5,357		5,590		(233	)		(4	)
SG&A	$	125,200	$	111,301	$	13,899			12

SG&A expenses ~~decreased~~increased by $2$14 million, or 2%12%, during the three months ended March 31, ~~2017~~2018 compared to March 31, ~~2016.~~2017. SG&A expenses include $6$5 million and $5$6 million of charges for the three months ended March 31, ~~2017~~2018 and ~~2016,~~2017, respectively, for non-core corporate costs that are removed from Adjusted EBITDA. Excluding these items, the increase in our SG&A expenses for the three months ended March 31, ~~2017~~2018 compared to the three months ended March 31, ~~2016 decreased by $2 million, or 2%.~~2017 remained $14 million. Workforce expenses, which include the wages and benefits of our selling, marketing, advertising, finance and legal personnel, increased ~~marginally~~ by $1$19 million, or ~~1%.~~22%, primarily due to merit, headcount and other employee-related incentives and unfavorable foreign exchange movements. Non-workforce expenses, which include the costs of finance and legal professional fees, communications and marketing and foreign exchange related costs, decreased by $3$5 million, or ~~13%~~22%, primarily due to ~~lower~~ realized foreign exchange ~~losses.~~

gains.

Non-core corporate costs of $6$5 million and $5$6 million for the three months ended March 31, ~~2017~~2018 and ~~2016,~~2017, respectively, represent costs related to strategic transactions and restructurings, equity-based compensation, impairment of ~~long lived~~long-lived assets, certain legal and related costs and unrealized foreign currency gains and losses related to derivatives. ~~These~~The decrease of $4 million of corporate and restructuring costs ~~remained stable during~~and $3 million in equity-based compensation and related taxes was offset by $6 million of unfavorable movements in the ~~three months ended March 31, 2017 compared to March 31, 2016.~~

fair value of unrealized foreign currency derivative contracts.

Depreciation and Amortization

Depreciation and amortization is comprised of:

Three Months Ended
March 31, Change
(in $ thousands) 2017 2016 $ %
Depreciation on property and equipment $ 42,517 $ 41,102 $ 1,415 3
Amortization of acquired intangible assets 10,392 11,139 (747) (7)
Total depreciation and amortization $ 52,909 $ 52,241 $ 668 1

	Three Months Ended
	March 31,				Change
(in $ thousands)	2018		2017		$			%
Depreciation on property and equipment	$	38,411	$	42,517	$	(4,106	)		(10	)
Amortization of acquired intangible assets		10,166		10,392		(226	)		(2	)
Total depreciation and amortization	$	48,577	$	52,909	$	(4,332	)		(8	)

Total depreciation and amortization ~~increased marginally~~decreased by $1$4 million, or 1%8%.

Depreciation on property and equipment decreased by $4 million, or 10%, due to lower level of depreciable assets. Amortization of acquired intangible assets remained stable.

Interest Expense, Net

Interest expense, net, decreased ~~$25~~by $15 million, or ~~45%~~51%, primarily due to (i) a ~~$17~~$10 million unrealized favorable impact of fair value changes on our interest rate ~~swaps,~~swap derivative contracts and ~~an $8~~(ii) a $4 million decrease ~~due~~related to the ~~lower outstanding~~reduced balance ofon the term loans outstanding under our senior secured credit agreement and lower interest rates.

Loss on Early Extinguishment of Debt

In March 2018, we issued senior secured notes and entered into a ~~decrease~~new senior secured credit agreement (the “2018 Credit Agreement”). The proceeds from the issuance of the senior secured notes and term loan borrowings under the 2018 Credit Agreement, along with cash on our balance sheet, were used to fully repay our borrowings under the previous senior secured credit agreement (the “2014 Credit Agreement”). This transaction was accounted for as the issuance of new debt and an extinguishment of existing debt resulting in ~~the interest rate~~a loss on ~~such term loans.~~early extinguishment of $28 million.

Provision for Income Taxes

Our tax provision differs significantly from the expected provision amount calculated at the U.S. ~~Federal~~federal statutory rate primarily as a result of ~~a number of items such as~~ (i) being subject to income tax in numerous non-U.S. jurisdictions with varying income tax rates, (ii) a valuation allowance ~~continued to be~~ maintained in various jurisdictions, including the U.S. and the U.K., due to ~~the~~ historical losses in such jurisdictions, (iii) certain expenses that are not deductible for tax or do not secure an effective tax deduction under the relevant jurisdictions, ~~and~~ (iv) certain income or gains ~~which~~that are not subject to ~~tax.~~

tax, (v) the impact of the U.S. Tax Reforms and (vi) the impact of changes in the U.K. to the tax deductibility of interest.

As of December 31, 2017, our deferred tax asset in respect of U.S. and non–U.S. NOL carry forwards and U.S. tax credits were $197 million. We believe it is more likely than not that the benefit from such deferred tax assets will not be realized. Consequently, we have recorded a valuation allowance of $187 million against such deferred tax assets as of December 31, 2017.

We regularly assess our ability to realize deferred tax assets. As of March 31, 2018, our estimate of our annual effective tax rate includes the impact of releasing a portion of the valuation allowance associated with both the U.S. and U.K. NOL carry forwards (see below). However, we have maintained a valuation allowance on the remaining deferred tax assets. Future realized earnings performance and changes in future earnings projections, among other factors, may cause an adjustment to the conclusion as to whether it is more likely than not that the benefit of the deferred tax assets will be realized. This would impact the income tax expense in the period for which it is determined that these factors have changed.

As a result of our debt restructuring in March 2018 (see Note 11–Long-term Debt to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q), we expect that there will be future taxable income in the U.K. other than the reversal of deferred tax liabilities. Consequently, we have realized a benefit of $10 million following the release of the valuation allowance on deferred tax assets associated with our U.K. NOL carry forwards (see Note 4–Income Taxes to our consolidated condensed financial statements included in this Quarterly Report on Form 10-Q).

Liquidity and Capital Resources

Our principal sources of liquidity are (i) cash and cash equivalents, (ii) cash flows generated from operations and (iii) borrowings under our revolving credit facility. As of March 31, ~~2017,~~2018, our cash and cash equivalents and revolving credit facility availability were as follows:

(in $ thousands)
March 31,
2017

Cash and cash equivalents $ 187,407
Revolving credit facility availability 116,690

	March 31,
(in $ thousands)	2018
Cash and cash equivalents	$	127,165
Revolving credit facility availability		141,658

With the cash and cash equivalents on our consolidated condensed balance sheet, our ability to generate cash from operations and access to our revolving credit facility and other lending sources, we believe we have sufficient liquidity to meet our ongoing needs for at least the next 12 months.

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Working Capital

Our cash flows from operations are significantly impacted by revenue derived from, and commissions paid to, travel providers and travel agencies and ~~consists~~consist of accounts receivables and deferred revenue from travel providers and travel agencies, current prepaid travel agency incentive payments and accrued liabilities for commissions. The movement within these account balances are included within working capital.

The table below sets out our working capital as of March 31, ~~2017~~2018 and December 31, ~~2016,~~2017, as monitored by management, which is then reconciled to our working capital as presented in our consolidated condensed balance sheets:

Asset (Liability)
(in $ thousands)
March 31,
2017

December 31,
2016
Change
Accounts receivable, net $ 267,785 $ 218,224 $ 49,561
Accrued commissions and incentives (321,145) (267,488) (53,657)
Deferred revenue and prepaid incentives, net (30,762) (32,741) 1,979
Cash and cash equivalents 187,407 139,938 47,469
Accounts payable and employee related (129,305) (144,657) 15,352
Accrued interest (13,125) (15,215) 2,090
Current portion of long-term debt (62,441) (63,558) 1,117
Taxes 260 9,618 (9,358)
Other assets (liabilities), net 3,154 (3,207) 6,361
Working Capital $ (98,172) $ (159,086) $ 60,914
Consolidated Condensed Balance Sheets:
Total current assets $ 554,478 $ 442,251 $ 112,227
Total current liabilities (652,650) (601,337) (51,313)
Working Capital $ (98,172) $ (159,086) $ 60,914

	Asset (Liability)
	March 31,			December 31,
(in $ thousands)	2018			2017			Change
Accounts receivable, net	$	270,663		$	206,524		$	64,139
Accrued commissions and incentives		(356,856	)		(282,954	)		(73,902	)
Deferred revenue and prepaid incentives, net		(39,447	)		(31,419	)		(8,028	)
Cash and cash equivalents		127,165			122,039			5,126
Accounts payable and employee related		(143,477	)		(145,140	)		1,663
Accrued interest		(4,131	)		(12,010	)		7,879
Current portion of long-term debt		(54,089	)		(64,291	)		10,202
Taxes		(2,804	)		(2,823	)		19
Other assets, net		32,324			1,724			30,600
Working Capital	$	(170,652	)	$	(208,350	)	$	37,698
Consolidated Condensed Balance Sheets:
Total current assets	$	540,354		$	438,287		$	102,067
Total current liabilities		(711,006	)		(646,637	)		(64,369	)
Working Capital	$	(170,652	)	$	(208,350	)	$	37,698

As of March 31, ~~2017,~~2018, we had a working capital net liability of ~~$98~~$171 million compared to ~~$159~~$208 million as of December 31, ~~2016, a~~2017. The decrease of ~~$61~~$38 million ~~which~~ is primarily due to a ~~$50~~$64 million increase in accounts receivable, net, a ~~$47~~$31 million increase in other assets, net, a $10 million decrease in the current portion of long-term debt, an $8 million decrease in accrued interest and a $5 million increase in cash and cash equivalents as discussed in ~~“—Cash Flows”~~“Cash flows” below, ~~a $15 million decrease in accounts payable and employee related liabilities and a $6 million increase in other assets (liabilities),net,~~ partially offset by a ~~$54~~$74 million increase in accrued ~~commissions~~commission and incentives, and ~~a $9~~an $8 million ~~decrease~~increase in ~~taxes.~~

~~As our business grows and our revenue and corresponding commissions and incentive expenses increase, our receivables and accruals increase.~~

deferred revenue.

The table below sets out information on our accounts receivable:

March 31,
2017 December 31,
2016 Change
Accounts receivable, net (in $ thousands) $ 267,785 $ 218,224 $ 49,561
Accounts receivable, net – Days Sales Outstanding (“DSO”) 36 39 (3)

	March 31,		December 31,
	2018		2017		Change
Accounts receivable, net(in $ thousands)	$	270,663	$	206,524	$	64,139
Accounts receivable, net – Days Sales Outstanding (“DSO”)		38		37		1

Substantially all of our Air revenue within our Travel Commerce Platform is collected through the Airline Clearing House (“ACH”) and other similar clearing houses. ACH requires participants to deposit certain balances into their demand deposit accounts by certain deadlines, which facilitates a timely settlement process. For the three months ended March 31, ~~2017,~~2018, Air revenue accounted for approximately ~~73%~~70% of our revenue; however, only ~~51%~~50% of our outstanding receivables related to customers using ACH as of March 31, ~~2017.~~2018. The ACH receivables are collected on average in 3031 days. Beyond Air revenue is generally not collected through the ACH process and takes longer to collect. Our average net collection period for total accounts receivable, net, was 3638 DSO as of March 31, ~~2017,~~2018, as compared to 3937 DSO as of December 31, ~~2016.~~2017. The growth in Air revenue in ~~the month of~~ March ~~2017~~2018 compared to December ~~2016,~~2017 contributed to the increase in our accounts receivables, net, balance.

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Our revenue can experience seasonal fluctuations, reflecting seasonal trends for the products and services we offer. Our accounts receivable balance increased by ~~$50~~$64 million from December 31, ~~2016~~2017 to March 31, ~~2017,~~2018, and our accrued commissions and incentives increased by ~~$54~~$74 million from December 31, ~~2016~~2017 to March 31, ~~2017,~~2018, reflecting the seasonality in our business. Seasonality trends generally cause our revenue to be higher in the first and second quarters as compared to the third and fourth quarters of the calendar year. Revenue and related cost of revenue typically peaks during the first half of the year as travelers plan and book their upcoming spring and summer travel.

Cash Flows

The following table summarizes the changes to our cash flows provided by (used in) operating, investing and financing activities for the three months ended March 31, 2018 and 2017:

	Three Months Ended
	March 31,						Change
(in $ thousands)	2018			2017			$
Cash provided by (used in):
Operating activities of continuing operations	$	83,097		$	95,022		$	(11,925	)
Investing activities		(36,663	)		(23,609	)		(13,054	)
Financing activities		(41,705	)		(24,251	)		(17,454	)
Effect of exchange rate changes		397			307			90
Net increase in cash and cash equivalents	$	5,126		$	47,469		$	(42,343	)

As of March 31, 2018, we had $127 million of cash and cash equivalents, an increase of $5 million compared to December 31, 2017. The following discussion summarizes the changes to our cash flows from operating, investing and financing activities for the three months ended March 31, 2018 compared to the three months ended March 31, 2017.

Operating activities. For the three months ended March 31, 2018, cash provided by operating activities was $83 million compared to $95 million for the three months ended March 31, 2017. The decrease of $12 million is primarily a result of lower operating income, higher income tax payments and higher customer loyalty payments.

Investing activities. The cash used in investing activities was $37 million for the three months ended March 31, 2018 and $24 million for the three months ended March 31, 2017, which was for the purchase of property and ~~2016:~~

Three Months Ended
March 31, Change
(in $ thousands) 2017 2016 $
Cash provided by (used in):
Operating activities $ 95,022 $ 26,204 $ 68,818
Investing activities (23,609) (22,521) (1,088)
Financing activities (24,251) (31,039) 6,788
Effect of exchange rate changes 307 508 (201)
Net increase (decrease) in cash and cash equivalents $ 47,469 $ (26,848) $ 74,317

equipment.

Our investing activities for the three months ended March 2018 and 2017 include:

	Three Months Ended
	March 31,
(in $ thousands)	2018		2017		Change
Cash additions to software developed for internal use	$	31,352	$	17,882	$	13,470
Cash additions to computer equipment and other		5,311		5,727		416
Property and equipment additions	$	36,663	$	23,609	$	13,054

Our Capital Expenditures, substantially all of which relate to our Travel Commerce Platform, include cash additions for software developed for internal use and computer equipment, as well as cash used for the repayment of capital lease and other indebtedness obligations. For the three months ended March 31, 2018 and 2017, we repaid capital lease and other indebtedness obligations of $8 million and $10 million, respectively, which are primarily related to assets within our data center. Our total Capital Expenditures were $45 million and $33 million for the three months ended March 31, 2018 and 2017, respectively.

Cash additions to software developed for internal use represent the continuing development of our systems to enhance our Travel Commerce Platform. Our expenditures have been focused on key areas, including investing in our data center, enhancing our search technology and capabilities, developing mobile customer engagement solutions, the development of content for hotels and car rental providers, further development of Smartpoint, our innovative booking solution delivering multisource content and pricing and the development of our Travelport Merchandising Platform to allow airlines to showcase their content in travel agency workflows.

Financing activities. Cash used in financing activities for the three months ended March 31, 2018 was $42 million, which primarily consisted of (i) $1,400 million of gross proceeds from term loans borrowed under the 2018 Credit Agreement, (ii) $745 million of gross proceeds from the issuance of senior secured notes, offset by (iii) $2,154 million of repayments of term loans under the 2014 Credit Agreement, (iv) $17 million of payments towards debt finance costs and lender fees, (v) $9 million of dividend payments to our shareholders and (vi) $8 million of capital lease and other indebtedness repayments. The cash used in financing activities for the three months ended March 31, 2017 was $24 million, which primarily consisted of (i) $6 million of term loans repayments, (ii) $10 million of capital lease and other indebtedness repayments and (iii) $9 million of dividend payments to our shareholders.

We believe our important measure of liquidity is Free Cash Flow. This measure is a useful indicator of our ability to generate cash to meet our liquidity demands. We use this measure to conduct and evaluate our operating liquidity. We believe it typically presents an alternate measure of cash flows since purchases of property and equipment are a necessary component of our ongoing operations and provides useful information regarding how cash provided by operating activities compares to the property and equipment investments required to maintain and grow our platform. We believe it provides investors with an understanding of how assets are performing and measures management’s effectiveness in managing cash.

Free Cash Flow is a non-GAAP measure and may not be comparable to similarly named measures used by other companies. This measure has limitations in that it does not represent the total increase or decrease in the cash balance for the period, nor does it represent cash flow for discretionary expenditures. This measure should not be considered as a measure of liquidity or cash flows from operations as determined under U.S. GAAP. This measure is not measurement of our financial performance under U.S. GAAP and should not be considered in isolation or as alternative to net income (loss) or any other performance measures derived in accordance with U.S. GAAP or as an alternative to cash flows from operating activities as a measure of liquidity.

We use Capital Expenditures to determine our total cash spent on acquisition of property and equipment and cash repayment of capital lease obligation and other indebtedness. We believe this measure provides management and investors an understanding of total capital invested in the development of our platform. Capital Expenditures is a non-GAAP measure and may not be comparable to similarly named measures used by other entities. This measure has limitation in that it aggregates cash flows from investing and financing activities as determined under U.S. GAAP.

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The following table provides a reconciliation of net cash provided by operating activities to Free Cash ~~Flow. We have also supplementally provided as part of this reconciliation a reconciliation of Adjusted EBITDA, our primary key performance measure, to net cash provided by operating activities:~~

Three Months Ended
March 31,
(in $ thousands) 2017 2016
Adjusted EBITDA $ 168,553 $ 154,140
Interest payments (30,126) (37,480)
Tax payments (3,905) (4,549)
Customer loyalty payments (16,755) (25,307)
Changes in working capital (13,588) (49,048)
Pensions liability contribution (595) (1,118)
Changes in other assets and liabilities (2,779) (7,108)
Other adjusting items(1)
(5,783) (3,326)
Net cash provided by operating activities 95,022 26,204
Less: capital expenditures on property and equipment additions (23,609) (22,521)
Free Cash Flow $ 71,413 $ 3,683

~~(1)~~

Other adjusting items relate to payments for costs included within operating income but excluded from Adjusted EBITDA, and during the three months ended March 31, 2017 and 2016, relate to payments for corporate and restructuring costs.

Flow:

	Three Months Ended
	March 31,
(in $ thousands)	2018			2017
Net cash provided by operating activities	$	83,097		$	95,022
Property and equipment additions		(36,663	)		(23,609	)
Free Cash Flow	$	46,434		$	71,413

Financing Arrangements

As of March 31, 2017, we had $187 million of cash and cash equivalents, an increase of $47 million compared to December 31, 2016. The following discussion summarizes changes to our cash flows from operating, investing and financing activities for the three months ended March 31, 2017 compared to the three months ended March 31, 2016.

~~Operating activities.~~ For the three months ended March 31, 2017, cash provided by operating activities was $95 million compared to $26 million for the three months ended March 31, 2016. The increase of $69 million is primarily a result of the increase in operating income, the positive impact from fluctuations in working capital, lower customer loyalty payments and cash interest payments.

~~Investing activities.~~ The cash used in investing activities was $24 million for the three months ended March 31, 2017 and $23 million for the three months ended March 31, 2016, which was primarily for the purchase of property and equipment.

~~Our investing activities for the three months ended March 31, 2017 and 2016 include:~~

Three Months Ended
March 31,
(in $ thousands) 2017 2016
Cash additions to software developed for internal use $ 14,074 $ 18,558
Cash additions to computer equipment 9,535 3,963
Total $ 23,609 $ 22,521

Cash additions to software developed for internal use represent the continuing development of our systems to enhance our Travel Commerce Platform. Our expenditures have been focused on key areas, including investing in our data center, the development of our Travelport Universal API that underpins our new and existing applications, the development of Smartpoint, our innovative booking solution delivering multisource content and pricing, and the development of our Travelport Merchandising Platform to allow airlines to showcase their content in travel agency workflows.

~~Cash additions to computer equipment are primarily for our continuing investment in our data center.~~

We view our Capital Expenditure for the period to include cash additions to our property and equipment and repayment of capital lease and other indebtedness, and was $33 million and $35 million for the three months ended March 31, 2017 and 2016, respectively.

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~~Financing activities.~~ Cash used in financing activities for the three months ended March 31, 2017 was $24 million, which primarily consisted of (i) $10 million of capital lease and other indebtedness repayments, (ii) $9 million in dividend payments to shareholders and (iii) $6 million of term loans repayment. The cash used in financing activities for the three months ended March 31, 2016 was $31 million, which primarily consisted of (i) $9 million of term loans repayment, (ii) $12 million of capital lease repayments and (iii) $9 million in dividend payments to shareholders.

~~Financing Arrangements~~

~~As of March 31, 2017,~~2018, our financing arrangements include our senior secured credit facilities under the 2018 Credit Agreement, senior secured notes and obligations under our capital leases and other indebtedness. The following table summarizes our Net Debt position as of March 31, ~~2017~~2018 and December 31, ~~2016:~~

(in $ thousands)
Interest
rate
Maturity
March 31,
2017

December 31,
2016

Senior Secured Credit Agreement
Term loans
Dollar denominated(1)(2)(3)
L+3.25% September 2021 $ 2,232,453 $ 2,236,157
Revolver borrowings
Dollar denominated L+5.00% September 2019 — —
Capital leases and other indebtedness 100,776 108,611
Total debt 2,333,229 2,344,768
Less: cash and cash equivalents (187,407) (139,938)
Net Debt(4)
$ 2,145,822 $ 2,204,830

2017:

	Interest		March 31,			December 31,
(in $ thousands)	rate	Maturity	2018			2017
Senior Secured Credit Agreement
Term loans – (2018 Credit Agreement)⁽¹⁾	L+2.50%	March 2025	$	1,385,934		$	—
Term loans – (2014 Credit Agreement)⁽²⁾	L+2.75%	September 2021		—			2,124,439
Revolver borrowings – (2018 Credit Agreement)	L+2.25%	September 2022		—			—
Revolver borrowings – (2014 Credit Agreement)	L+2.50%	September 2022		—			—
Senior Secured Notes
Senior Secured Notes ⁽³⁾	6.00%	March 2026		737,404			—
Capital leases and other indebtedness				99,786			105,574
Total debt				2,223,124			2,230,013
Less: cash and cash equivalents				(127,165	)		(122,039	)
Net Debt⁽⁴⁾			$	2,095,959		$	2,107,974

(1)

As of March 31, 2018, the principal amount of terms loans under the 2018 Credit Agreement was $1,400 million, which is netted for unamortized debt discount of $7 million and unamortized debt finance costs of $7 million.

(2)

As of December 31, 2017, the principal amount of terms loans under the 2014 Credit Agreement was $2,154 million, which is netted for unamortized debt finance costs of $13 million and unamortized debt discount of $17 million.

(3)

As of March 31, 2018, the principal amount of senior secured notes was $745 million, which is netted for unamortized debt finance costs of $8 million.

(4)

Net Debt is defined as total debt comprised of current and non-current portion of long-term debt minus cash and cash equivalents. Net Debt is not a measurement of our indebtedness under U.S. GAAP and should not be considered in isolation or as alternative to assess our total debt or any other measures derived in accordance with U.S. GAAP. The management uses Net Debt to review our overall liquidity, financial flexibility, capital structure and leverage. Further, we believe, certain debt rating agencies, creditors and credit analysts monitor our Net Debt as part of their assessment of our business.

~~(1)~~

~~Minimum LIBOR floor~~

Senior Secured Credit Agreement

In March 2018, Travelport Finance (Luxembourg) S.à r.l. (the “Borrower”), our wholly-owned subsidiary, entered into the 2018 Credit Agreement under which, the lenders agreed to extend credit to the Borrower in the form of ~~1.00%~~

~~(2)~~

~~As of March 31, 2017 and December 31, 2016, the principal amounts of~~(a) initial secured term loans ~~were $2,272~~in an aggregate principal amount of $1,400 million ~~and $2,278 million, respectively, which is netted for unamortized debt finance costs of $17 million and $18 million, respectively, and unamortized debt~~maturing in March 2025, issued at a discount of ~~$22 million and $23 million, respectively.~~

~~(3)~~

~~Interest rate on~~0.50%, which amortizes in quarterly installments, commencing August 31, 2018, equal to 0.25% of the ~~term loans as of December 31, 2016, was LIBOR plus 4.00%.~~

~~(4)~~

~~We are not contractually required to repay quarterly installments~~original principal amount of the term loans, ~~until~~with the ~~second quarter~~balance payable at maturity and (b) a revolving credit facility in an aggregate principal amount of ~~2019. However, we have classified a portion of~~$150 million maturing in September 2022. We used the net proceeds from these term loans, ~~as a current portion~~along with the proceeds from the issuance of long-term debt as we intend and are able to make additional voluntary prepayments of the term loans from cash flows from operations, which we expect to occur within the next twelve months. The amount of any such prepayments may vary based on our actual cash flow generation and needs, as well as general economic conditions.

~~In January 2017, we entered into an amendment for our~~ senior secured ~~credit agreement, which (i) amended the applicable rates to 2.25% per annum, in the case of base rate loans,~~notes (discussed below) and ~~3.25% per annum, in the case of LIBOR loans and (ii) reset the 1% premium~~cash on the ~~repricing~~balance sheet, to repay the outstanding balance remaining of the term loans under the ~~senior secured credit agreement~~2014 Credit Agreement and pay the related transaction expenses and fees. Upon the repayment in full of the obligations, the 2014 Credit Agreement was terminated. We recorded the debt refinancing transaction as the issuance of new debt and extinguishment of prior debt and recognized a loss of $28 million in our consolidated condensed statements of operations for ~~a period of six months. The~~the three months ended March 31, 2018.

Under the 2018 Credit Agreement, the interest rate per annum applicable to (a) the term loans is based on, at ~~our~~the election ~~(i)~~of the Borrower, LIBOR plus ~~3.25%~~2.50% or base rate (as defined in the ~~senior secured~~

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~~credit~~ agreement) plus 1.50% and (b) the borrowings under revolving credit facility, at the election of the Borrower, LIBOR plus 2.25% or base rate (as defined in the agreement) plus 1.25%. ~~The term loans are subject to~~LIBOR rates and base rates have a ~~LIBOR~~ floor of ~~1.00% and a base rate floor of 2.00%~~0.00%. We expect to pay interest based on ~~LIBOR plus 3.25% for the term loans. During~~LIBOR.

Further, during the three months ended March 31, ~~2017, the average LIBOR rate applied to the term loans was 1.02%.~~

~~During the three months ended March 31, 2017,~~2018, we (i) repaid a ~~net amount~~quarterly installment of $6 million principal of term loans outstanding under ~~our senior secured credit agreement,~~the 2014 Credit Agreement, (ii) amortized $2$1 million of each of debt finance costs and ~~$1 million of~~ debt discount, ~~and~~ (iii) repaid ~~$10~~$7 million under our capital lease obligations ~~and other indebtedness~~ and entered into $2 million of new capital leases for information technology ~~assets.~~

assets and (iv) repaid $1 million under our other indebtedness obligations.

As discussed above, in March 2018, the Borrower entered into a new revolving credit facility under the 2018 Credit Agreement with a consortium of banks. The lenders, terms, credit facility amount and maturity date under the new revolving credit facility were substantially the same as under the 2014 Credit Agreement, except for the reduction in interest rates discussed above. Under ~~our senior secured credit agreement, we have~~the new terms, the Borrower has a ~~$125~~$150 million revolving credit facility, ~~with a consortium of banks,~~ which contains a letter of credit sub-limit up to a maximum of ~~$50~~$100 million. As of March 31, ~~2017, we had~~2018, there were no outstanding borrowings under ~~our~~the revolving credit facility under the 2018 Credit Agreement, and ~~utilized~~ $8 million was utilized for the issuance of letters of credit, with a balance of ~~$117~~$142 million remaining.

~~The~~

Senior Secured Notes

In March 2018, Travelport Corporate Finance PLC (the “Issuer”), our wholly-owned subsidiary, issued a principal amount of $745 million in senior secured ~~credit agreement also permits the issuance~~notes due in March 2026 with a stated interest rate of ~~certain cash collateralized letters~~6.00% per annum. The proceeds were used to repay a portion of ~~credit in addition to those that can be issued~~our term loans outstanding under the ~~revolving credit facility, whereby 103%~~2014 Credit Agreement. The interest on the senior secured notes is payable semi-annually in cash in arrears on March 15 and September 15 of ~~cash collateral has to be maintained for outstanding letters of credit. As of March 31, 2017, there were no outstanding cash collateralized letters of credit.~~

~~Substantially all of our debt is scheduled for repayment in~~each year, commencing September ~~2021.~~

15, 2018.

Travelport Finance (Luxembourg) S.a.r.l., our indirect 100% owned subsidiary, is the obligor (the “Obligor”) under our senior secured credit agreement. All obligations under our senior secured credit agreement are unconditionally guaranteed by certain of our wholly owned foreign subsidiaries, and, subject to certain exceptions, each of our existing and future domestic wholly owned subsidiaries. All obligations under our secured debt, and the guarantees of those obligations, are secured by substantially all the following assets of the Obligor and each guarantor, subject to certain exceptions: (i) a pledge of 100% of the capital stock and intercompany indebtedness of the Obligor and each guarantor; (ii) a pledge of 100% of the capital stock and intercompany indebtedness of certain other subsidiaries directly owned by the Obligor or any other guarantor subject to certain exceptions and limitations; and (iii) a security interest in, and mortgages on, substantially all tangible and intangible assets of the Obligor and each U.S. guarantor subject to additional collateral and guarantee obligations.

Borrowings under ~~our senior secured credit agreement~~the 2018 Credit Agreement are subject to amortization and prepayment ~~requirements,~~requirements. In addition, the 2018 Credit Agreement and ~~our~~the Indenture governing the senior secured ~~credit agreement contains~~notes contain various covenants, ~~including a leverage ratio,~~ events of default and other ~~provisions.~~

provisions, including, under certain circumstances, a leverage ratio requirement under the 2018 Credit Agreement.

Our 2018 Credit Agreement and Indenture governing the senior secured ~~credit agreement limits~~notes limit certain of our subsidiaries’ ability to:

•

incur additional indebtedness;

•

pay dividends on, repurchase or make distributions in respect of equity interests or make other restricted payments;

•

make certain investments;

•

sell certain assets;

•

create liens on certain assets to secure debt;

•

consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;

•

enter into certain transactions with affiliates; and

•

designate our subsidiaries as unrestricted subsidiaries.

As of March 31, ~~2017,~~2018, our consolidated first lien net leverage ratio, as determined under ~~our senior secured credit agreement,~~the 2018 Credit Agreement, was 3.83 compared to the maximum allowable of ~~6.00, and~~6.00. In addition, we were in compliance with ~~such~~the other covenants under ~~our senior secured credit agreement.~~

the 2018 Credit Agreement and Indenture.

We re-evaluate our capital structure from time to time including, but not limited to, refinancing our current indebtedness with other indebtedness which may have different interest rates, maturities and covenants.

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Interest Rate Risk

We are exposed to interest rate risk relating to our floating rate ~~debt.~~debt under the 2018 Credit Agreement. We use derivative financial instruments as part of our overall strategy to manage our exposure to interest rate risk. We do not use derivatives for trading or speculative purposes.

Our primary interest rate exposure as of March 31, ~~2017~~2018 was to interest rate fluctuations in the United States, specifically the impact of LIBOR interest rates on our dollar denominated floating rate debt. Interest on ~~our $2,232~~the $1,400 million principal amount of term loans under the 2018 Credit Agreement is currently charged at LIBOR plus ~~3.25%, subject to a LIBOR floor of 1.00% under our senior secured credit agreement. During the three months ended March 31, 2017, LIBOR rates increased above LIBOR floor of 1.00%~~2.50%. In order to protect against potential higher interest costs resulting from increases in LIBOR, ~~in October 2015,~~as of March 31, 2018, we ~~transacted $1,400 million notional amount of~~have outstanding interest rate swap contracts covering a period from February 2017 to February 2019. Further, during the three months ended March 31, 2017, we transacted $1,200 million notional amount of interest rate swap contracts commencing February 2019 until February 2020. These swapsthat fix the LIBOR rate payable ~~on approximately 60% of our floating rate debt during these periods at average rates of 1.4010% and 2.1906%, respectively.~~

as follows:

		Average
Notional Amount		Interest
($ in thousands)	Period	Rate
1,400,000	February 2017 to February 2019	1.4010%
1,200,000	February 2019 to February 2020	2.1906%
400,000	February 2020 to February 2021	2.1925%

During the three months ended March 31, ~~2017,~~2018, none of the derivative financial instruments used to manage our interest rate exposure were designated as accounting hedges. The fluctuations in the fair value of interest rate derivative financial instruments not designated as hedges for accounting purposes are recorded as a component of interest expense, net, in our consolidated condensed statements of operations. ~~(Gains) losses~~Gains on these interest rate derivative financial instruments were $11 million and less than ~~$(1) million and 16~~$1 million for the three months ended March 31, 2018 and 2017, ~~and 2016,~~ respectively.

Foreign Currency Risk

We are exposed to foreign currency exchange rate risk that arises from certain intercompany transactions, earnings denominated in non-U.S. dollar currencies and from non-functional currency denominated assets and ~~liabilities and earnings denominated in non-U.S. dollar currencies.~~

liabilities.

We use derivative financial instruments as part of our overall strategy to manage our exposure to foreign currency exchange rate risk. We do not use derivatives for trading or speculative purposes.

During ~~2017,~~2018, we used foreign currency derivative contracts (i.e. forward contracts) to manage our exposure to foreign currency exchange rate risk. As of March 31, ~~2017,~~2018, we had ~~$292~~$410 million net notional amount of foreign currency forward contracts.

During the three months ended March 31, ~~2017~~2018 and ~~2016,~~2017, none of the derivative financial instruments used to manage our foreign currency exposures were designated as accounting hedges. The fluctuations in the fair value of foreign currency derivative financial instruments not designated as hedges for accounting purposes are recorded as a component of selling, general and administrative expenses in our consolidated condensed statements of operations. Gains on these foreign currency derivative financial instruments amounted to $5 million and $2 million for ~~both of~~ the three months ended March 31, 2018 and 2017, ~~and 2016.~~respectively. The fluctuations in the fair values of our foreign currency derivative financial instruments partially offset the impact of the changes in the value of the underlying risks they are intended to economically hedge.

As of March 31, ~~2017,~~2018, our derivative contracts ~~which~~that hedge our interest rate and foreign currency exposure had a net ~~liability~~asset position of ~~$12~~$29 million and cover transactions for a period that does not exceed three years.

Contractual Obligations

~~In January~~

Following our debt restructuring in March 2018, our contractual obligations related to the terms loans have changed since December 31, 2017, ~~we amended~~and our contractual obligations also include obligations related to the senior secured ~~credit agreement under which~~notes we ~~reduced~~issued in March 2018. The following table summarizes our future contractual obligations related to our long-term debt as of March 31, 2018:

	Year Ending March 31,
(in $ thousands)	2019		2020		2021		2022		2023		Thereafter		Total
Term loans	$	10,500	$	14,000	$	14,000	$	14,000	$	14,000	$	1,333,500	$	1,400,000
Senior secured notes		—		—		—		—		—		745,000		745,000
Capital leases and other indebtedness		43,589		29,951		16,638		8,260		1,348		—		99,786
Interest payments⁽¹⁾		74,179		107,233		106,943		105,621		104,857		254,770		753,603
Total	$	128,268	$	151,184	$	137,581	$	127,881	$	120,205	$	2,333,270	$	2,998,389

(1) Interest payments include interest on the ~~applicable rate on our~~ term loans ~~from 4.00% to 3.25%. This repricing~~under the 2018 Credit Agreement, the senior secured notes and our capital leases and other indebtedness. Interest on the term loans is ~~expected to lower our annualized interest expense by approximately $17 million~~ based on the ~~principal balance outstanding~~interest rate as of March 31, 2018 of LIBOR plus 2.50%, and interest on the ~~date~~senior secured notes is based on its stated rate of ~~the repricing.~~

6.00%. Interest payments also include an estimate of cash flows for interest rate swap contracts.

Other than as set forth above, as of March 31, ~~2017,~~2018, our future contractual obligations have not changed significantly from the amounts included within our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2017 filed with the SEC on February ~~21, 2017.~~

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20, 2018.

Other Off-Balance Sheet Arrangements

We had no other ~~off balance~~off-balance sheet arrangements during the three months ended March 31, ~~2017.~~2018.

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We assess our market risk based on changes in interest rates and foreign currency exchange rates utilizing a sensitivity analysis that measures the potential impact on earnings, fair values and cash flows based on a hypothetical 100 basis point change (increase and decrease) in interest rates and a 10% change (increase and decrease) in the exchange rates against the U.S. dollar as of March 31, ~~2017.~~2018. There are certain limitations inherent in these sensitivity analyses as our overall market risk is influenced by a wide variety of factors, including the volatility present within markets and the liquidity of markets. These “shock tests” are constrained by several factors, including the necessity to conduct analysis based on a single point in time and the inability to include complex market reactions normally arising from the market shifts modelled.

Interest Rate Risk

We assess our interest rate market risk utilizing a sensitivity analysis based on a hypothetical 100 basis point change (increase or decrease) in interest rates. WeAs of March 31, 2018, we have determined, through such analysis, that a 100 basis point increase or decrease in interest rates, ~~as of March 31, 2017,~~ based on the outstanding floating rate debt balance, would increase or decrease our annualized interest charge by ~~$23~~$14 million, excluding the effect of fair value changes on our interest rate swaps. ~~Due to the 1.00% LIBOR floor on our term loans, a 100 basis point decrease in interest rates as of March 31, 2017 would decrease our annualized interest charge by $3 million.~~

In ~~2015, in~~ order to protect against potential higher interest costs resulting from increases in LIBOR, ~~interest rates,~~ we ~~transacted $1,400 million notional amount of~~have entered into several interest rate swap contracts for a period from February 2017 to February 2019. Additionally, during the three months ended March 31, 2017, we transacted $1,200 million notional amount of interest rate swap contracts commencing February 2019 until February 2020. These swaps fix the LIBOR rate payable on approximately 60% of our floating rate debt during these future period at 1.4010% and 2.1906%, respectively.derivative contracts. We have not hedge accounted for these swaps. Mark to market fair value changes on these swaps, which represent the net present value of future cash flows on the swaps, are accounted for within interest expense, net, in our consolidated condensed statement of operations. As of March 31, ~~2017,~~2018, a 100 basis point increase or decrease in interest rates would result in a credit or debit, respectively, to our interest expense of ~~$40~~$30 million due to changes in the fair value of these swaps.

Foreign Currency Risk

We have foreign currency exposure to exchange rate fluctuations, particularly with respect to the British pound, Euro and Australian dollar. We anticipate such foreign currency exchange rate risk will remain a market risk exposure for the foreseeable future. We assess our foreign currency market risk utilizing a sensitivity analysis based upon a hypothetical 10% change (increase or decrease) in exchange rate against the U.S. dollar on the value of our foreign currency derivative instruments as of March 31, ~~2017.~~2018. We have determined, through the sensitivity analysis, that the impact of a 10% strengthening or weakening in the U.S. dollar exchange rate with respect to the British pound, Euro and Australian dollar would result in a ~~charge~~debit or a credit, respectively, of ~~approximately $26~~$39 million and $41 million, respectively, on our consolidated condensed statements of ~~operations, while a 10% weakening in the U.S. dollar exchange rate with respect to the same currencies would result in a credit of $28 million on our consolidated condensed statements of~~ operations.

There were no material changes to our market risks as previously disclosed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Quantitative and Qualitative Disclosure About Market Risks” included ~~within~~in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2017 filed with the SEC on February ~~21, 2017.~~

20, 2018.

~~TABLE OF CONTENTS~~

Item 4.Controls and Procedures

~~(a)~~

~~Disclosure Controls and Procedures.~~ The Company maintains disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the “Act”) is recorded, processed, summarized and reported within the specified time periods and accumulated and communicated to management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

(a)

Disclosure Controls and Procedures.The Company maintains disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the “Act”) is recorded, processed, summarized and reported within the specified time periods and accumulated and communicated to management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Act) as of March 31, ~~2017.~~2018. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, our disclosure controls and procedures were effective.

(b)

Changes in Internal Control Over Financial Reporting. There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Act) during the Company’s fiscal quarter ended March 31, 2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

(c)

Limitations on Controls. Management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

~~(b)~~

~~Changes in Internal Control Over Financial Reporting.~~ There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Act) during the Company’s fiscal first quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

~~(c)~~

~~Limitations on Controls.~~ Management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

~~TABLE OF CONTENTS~~

PART II—OTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS.

~~There~~

Consumer Antitrust Class Action

On July 14, 2015 and July 17, 2015, approximately 24 plaintiffs filed purported class action lawsuits against us, Amadeus and Sabre in the United States District Court for the Southern District of New York (Gordon et al. v. Amadeus IT Group, S.A et al.). A consolidated, amended complaint was filed on October 2, 2015 (the “Amended Complaint”). The Amended Complaint alleged violations of the Sherman Act, state antitrust laws and state consumer protection laws by defendants beginning in 2006. In particular, the plaintiffs claimed there was a conspiracy among us and the other defendants to impose contract terms on airlines, which the plaintiffs allege had the effect of maintaining higher fees and restricting competition. On November 7, 2017, we entered into a settlement agreement with the plaintiffs, which received final approval by the court on April 23, 2018. The settlement resolved all pending claims against us in connection with the case, and the court dismissed the Amended Complaint in full, with prejudice, on April 23, 2018 and closed the case as of that date.

Other than as set forth above, there are no material changes from the description of our legal proceedings disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2017, filed with the SEC on February ~~21, 2017.~~

20, 2018.

ITEM 1A.RISK FACTORS.

There have been no material changes in the risk factors previously disclosed in Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2017, filed with the SEC on February ~~21, 2017.~~

20, 2018.

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Not Applicable.

ITEM 3.DEFAULTS UPON SENIOR SECURITIES.

Not Applicable.

ITEM 4.MINE SAFETY DISCLOSURES.

Not Applicable.

ITEM 5.OTHER INFORMATION.

~~Executive Transition~~

On May 5, 2017, Thomas Murphy, our Executive Vice President and General Counsel, provided us with notice of his resignation from his employment with us for personal reasons. Mr. Murphy will work to ensure a smooth handover of duties.

Trade Sanctions Disclosure

The following activities are disclosed as required by Section 13(r)(1)(D)(iii) of the Exchange Act.

As part of our global business in the travel industry, we provide certain passenger travel related Travel Commerce Platform and Technology Services to Iran Air. We also provide certain Technology Services to Iran Air Tours. All of these services are either exempt from applicable sanctions prohibitions pursuant to a statutory exemption permitting transactions ordinarily incident to travel or, to the extent not otherwise exempt, specifically licensed by the U.S. Office of Foreign Assets Control. Subject to any changes in the exempt/licensed status of such activities, we intend to continue these business activities, which are directly related to and promote the arrangement of travel for individuals.

The gross revenue and net profit attributable to these activities in the quarter ended March 31, ~~2017~~2018 were approximately ~~$137,000~~$121,000 and ~~$96,000~~$94,000 respectively.

ITEM 6.EXHIBITS.

See Exhibit Index.

~~TABLE OF CONTENTS~~

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

				TRAVELPORT WORLDWIDE LIMITED

Date: May ~~9, 2017~~3, 2018	By:		~~By:~~ /s/ Bs~~ernard~~ Bot / Bernard Bot
		Bernard Bot
		Executive Vice President and Chief Financial Officer


Date: May ~~9, 2017~~3, 2018	By:		~~By:~~ /s/A~~ntonios~~ B~~asoukeas~~ Antonios Basoukeas
		Antonios Basoukeas
		Chief Accounting Officer

~~TABLE OF CONTENTS~~

EXHIBIT INDEX

	Exhibit No.		Description
3.1	~~3.1~~		Amended and Restated Memorandum of Association of Travelport Worldwide Limited (Incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed by Travelport Worldwide Limited on September 30, 2014).
3.2		Amended and Restated Bye-laws of Travelport Worldwide Limited (Incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by Travelport Worldwide Limited on September 30, 2014).
4.1	~~3.2~~		~~Amended~~Indenture, dated as of March 16, 2018, by and ~~Restated Bye-laws of~~among Travelport ~~Worldwide Limited~~Corporate Finance PLC, as issuer, the guarantors from time to time party thereto and U.S. Bank, National Association, as trustee and as collateral agent (Incorporated by reference to Exhibit ~~3.2~~4.1 to the Current Report on Form 8-K filed by Travelport Worldwide Limited on ~~September 30, 2014)~~March 16, 2018).
4.2	~~10.1~~	Form of 6.00% Senior Secured Notes due 2026 (included in Exhibit 4.1 to the Current Report on Form 8-K filed by Travelport Worldwide Limited on March 16, 2018).
10.1		~~Amendment No.3 to~~ Credit Agreement, dated ~~as of January 19, 2017,~~March 16, 2018, among Travelport Limited, Travelport Finance (Luxembourg) S.a.r.l., the guarantors from time to time party thereto and Goldman Sachs Bank USA, as ~~borrower, Travelport Limited, the Term~~ administrative agent, collateral agent and an L/C ~~lenders~~issuer, and ~~Deutsche Bank AG New York Branch~~each lender from time to time party thereto (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by Travelport Worldwide Limited on ~~January 20, 2017)~~March 16, 2018).
10.2	~~10.2~~		Form of ~~2017~~2018 Travelport Worldwide Limited Management Equity Award Agreement (US Named Executive Officers)
10.3	~~10.3~~		Form of ~~2017~~2018 Travelport Worldwide Limited Management Equity Award Agreement (UK Named Executive Officers)
31.1	~~31.1~~		Certification of Chief Executive Officer Pursuant to Rules 13(a)-14(a) and 15(d)-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	~~31.2~~		Certification of Chief Financial Officer Pursuant to Rules 13(a)-14(a) and 15(d)-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32	32		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	101.INS		XBRL Instance Document
	101.SCH		XBRL Taxonomy Extension Schema Document
	101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
	101.LAB		XBRL Taxonomy Extension Labels Linkbase Document
	101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
	101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

Bermuda	~~Bermuda~~			98-0505105
	(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)

	Large accelerated filer ☒x			Accelerated filer ☐¨			Non-accelerated filer ☐¨			Smaller reporting company ☐	¨
Emerging growth company¨				(Do not check if a smaller reporting company)

		Page
	Forward-Looking Statements		1
PART I. FINANCIAL INFORMATION
Item 1	Financial Statements (unaudited)		3
	Consolidated Condensed Statements of Operations for the Three Months Ended March 31, 2018 and 2017 ~~and 2016~~ (unaudited)		3
	Consolidated Condensed Statements of Comprehensive Income for the Three Months Ended March 31, 2018 and 2017 ~~and 2016~~ (unaudited)		4
	Consolidated Condensed Balance Sheets as of March 31, ~~2017~~2018 (unaudited) and December 31, ~~2016~~2017		5
	Consolidated Condensed Statements of Cash Flows for the Three Months Ended March 31, 2018 and 2017 ~~and 2016~~ (unaudited)		6
	Consolidated Condensed Statement of Changes in Total Equity (Deficit) for the Three Months Ended March 31, 2018 and 2017 ~~and 2016~~ (unaudited)		8
	Notes to the Consolidated Condensed Financial Statements (unaudited)		9
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		2426
Item 3	Quantitative and Qualitative Disclosures About Market Risk		3942
Item 4	Controls and Procedures		4043
PART II. OTHER INFORMATION
Item 1	Legal Proceedings		4144
Item 1A	Risk Factors		4144
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds		4144
Item 3	Defaults upon Senior Securities		4144
Item 4	Mine Safety Disclosures		4144
Item 5	Other Information		4144
Item 6	Exhibits		4144
	Signatures		4245

(in $ thousands, except share data)	Three Months Ended March 31, 2017			Three Months Ended March 31, 2016
Net revenue		$	650,763		$	609,263
Costs and expenses
Cost of revenue			386,837			362,677
Selling, general and administrative			112,147			114,477
Depreciation and amortization			52,909			52,241
Total costs and expenses			551,893			529,395
Operating income			98,870			79,868
Interest expense, net			(30,275)			(54,895)
Income before income taxes			68,595			24,973
Provision for income taxes			(12,732)			(7,792)
Net income			55,863			17,181
Net loss (income) attributable to non-controlling interest in subsidiaries			243			(596)
Net income attributable to the Company		$	56,106		$	16,585
Income per share – Basic:
Income per share		$	0.45		$	0.13
Weighted average common shares outstanding – Basic			124,081,175			123,718,311
Income per share – Diluted:
Income per share		$	0.45		$	0.13
Weighted average common shares outstanding – Diluted			125,516,945			123,778,407
Cash dividends declared per common share		$	0.075		$	0.075

(in $ thousands, except share data)	March 31, 2017			December 31, 2016
Assets
Current assets:
Cash and cash equivalents		$	187,407		$	139,938
Accounts receivable (net of allowances for doubtful accounts of $12,720 and $13,430)			267,785			218,224
Other current assets			99,286			84,089
Total current assets			554,478			442,251
Property and equipment, net			414,639			431,046
Goodwill			1,082,315			1,079,951
Trademarks and tradenames			313,097			313,097
Other intangible assets, net			510,750			511,607
Deferred income taxes			9,366			9,213
Other non-current assets			48,460			46,764
Total assets		$	2,933,105		$	2,833,929
Liabilities and equity
Current liabilities:
Accounts payable		$	62,347		$	59,219
Accrued expenses and other current liabilities			527,862			478,560
Current portion of long-term debt			62,441			63,558
Total current liabilities			652,650			601,337
Long-term debt			2,270,788			2,281,210
Deferred income taxes			59,433			59,381
Other non-current liabilities			225,049			227,783
Total liabilities			3,207,920			3,169,711
Commitments and contingencies (Note 11)
Shareholders’ equity (deficit):
Preference shares ($0.0025 par value; 225,000,000 shares authorized; no shares issued and outstanding as of March 31, 2017 and December 31, 2016)			—			—
Common shares ($0.0025 par value; 560,000,000 shares authorized; 125,000,621 shares and 124,941,233 shares issued; 124,082,833 shares and 124,032,361 shares outstanding as of March 31, 2017 and December 31, 2016, respectively)			312			312
Additional paid in capital			2,705,950			2,708,836
Treasury shares, at cost (917,788 shares and 908,872 shares as of March 31, 2017 and December 31, 2016, respectively)			(14,294)			(14,166)
Accumulated deficit			(2,808,732)			(2,864,838)
Accumulated other comprehensive loss			(183,136)			(190,072)
Total shareholders’ equity (deficit)			(299,900)			(359,928)
Equity attributable to non-controlling interest in subsidiaries			25,085			24,146
Total equity (deficit)			(274,815)			(335,782)
Total liabilities and equity		$	2,933,105		$	2,833,929

	Common Shares					Additional Paid in Capital			Treasury Shares					Accumulated Deficit			Accumulated Other Comprehensive Loss			Non- Controlling Interest in Subsidiaries			Total Equity (Deficit)
(in $ thousands, except share data)	Number		Amount			Additional Paid in Capital			Number		Amount			Accumulated Deficit			Accumulated Other Comprehensive Loss			Non- Controlling Interest in Subsidiaries			Total Equity (Deficit)
Balance as of December 31, 2016		124,941,233		$	312		$	2,708,836		908,872		$	(14,166)		$	(2,864,838)		$	(190,072)		$	24,146		$	(335,782)
Dividend to shareholders ($0.075 per common share)		—			—			(10,054)		—			—			—			—			—			(10,054)
Equity-based compensation		59,388			—			7,168		—			—			—			—			1,182			8,350
Treasury shares purchased in relation to vesting of equity awards		—			—			—		8,916			(128)			—			—			—			(128)
Comprehensive income (loss), net of tax		—			—			—		—			—			56,106			6,936			(243)			62,799
Balance as of March 31, 2017		125,000,621		$	312		$	2,705,950		917,788		$	(14,294)		$	(2,808,732)		$	(183,136)		$	25,085		$	(274,815)

	March 31, 2017									December 31, 2016
(in $ thousands)	Cost			Accumulated depreciation			Net			Cost			Accumulated depreciation			Net
Capitalized software		$	965,418		$	(756,921)		$	208,497		$	925,998		$	(736,573)		$	189,425
Computer equipment			342,479			(207,804)			134,675			344,112			(205,222)			138,890
Building and leasehold improvements			26,670			(9,313)			17,357			27,187			(9,622)			17,565
Construction in progress			54,110			—			54,110			85,166			—			85,166
		$	1,388,677		$	(974,038)		$	414,639		$	1,382,463		$	(951,417)		$	431,046

(in $ thousands)	January 1, 2017			Additions			Retirements			Foreign Exchange			March 31, 2017
Non-Amortizable Assets:
Goodwill		$	1,079,951		$	—		$	—		$	2,364		$	1,082,315
Trademarks and tradenames			313,097			—			—			—			313,097
Other Intangible Assets:
Acquired intangible assets			1,127,059			—			(368,715)			26			758,370
Accumulated amortization			(804,089)			(10,392)			368,715			(52)			(445,818)
Acquired intangible assets, net			322,970			(10,392)			—			(26)			312,552
Customer loyalty payments			358,259			28,354			(12,908)			2,076			375,781
Accumulated amortization			(169,622)			(18,795)			12,908			(2,074)			(177,583)
Customer loyalty payments, net			188,637			9,559			—			2			198,198
Other intangible assets, net		$	511,607		$	(833)		$	—		$	(24)		$	510,750

(in $ thousands)	January 1, 2016			Additions			Retirements			Foreign Exchange			March 31, 2016
Non-Amortizable Assets:
Goodwill		$	1,067,415		$	—		$	—		$	4,660		$	1,072,075
Trademarks and tradenames			313,961			—			—			52			314,013
Other Intangible Assets:
Acquired intangible assets			1,127,360			—			—			(26)			1,127,334
Accumulated amortization			(756,489)			(11,139)			—			(552)			(768,180)
Acquired intangible assets, net			370,871			(11,139)			—			(578)			359,154
Customer loyalty payments			300,142			32,050			(19,880)			4,124			316,436
Accumulated amortization			(136,473)			(16,574)			19,154			(1,556)			(135,449)
Customer loyalty payments, net			163,669			15,476			(726)			2,568			180,987
Other intangible assets, net		$	534,540		$	4,337		$	(726)		$	1,990		$	540,141

(in $ thousands)	Severance and Employee-Related Obligations			Implementation Costs			Total
Balance as of January 1, 2017		$	11,082		$	1,686		$	12,768
Restructuring charges recognized			2,381			1,037			3,418
Cash payments made			(372)			(2,558)			(2,930)
Balance as of March 31, 2017		$	13,091		$	165		$	13,256

(in $ thousands)	Interest rate		Maturity	March 31, 2017			December 31, 2016
Senior Secured Credit Agreement
Term loans
Dollar denominated(1)(2)(3)		L+3.25%	September 2021		$	2,232,453		$	2,236,157
Revolver borrowings
Dollar denominated		L+5.00%	September 2019			—			—
Capital leases and other indebtedness						100,776			108,611
Total debt					$	2,333,229		$	2,344,768
Less: current portion						62,441			63,558
Long-term debt					$	2,270,788		$	2,281,210

(in $ thousands)	Three Months Ended March 31, 2017			Three Months Ended March 31, 2016
Net derivative liability opening balance		$	(19,196)		$	(2,111)
Total gain (loss) for the period included in net income			2,284			(14,605)
Payments on settlement of foreign currency derivative contracts			5,136			9,261
Net derivative liability closing balance		$	(11,776)		$	(7,455)

		Amount of Income (Loss) Recorded in Net Income
(in $ thousands)	Statement of Operations location	Three Months Ended March 31,
		2017			2016
Interest rate swap contracts	Interest expense, net		$	226		$	(16,456)
Foreign currency contracts	Selling, general and administrative			2,058			1,851
			$	2,284		$	(14,605)

(in dollars, except number of RSUs)	Number		Weighted Average Grant Date Fair Value
Balance as of January 1, 2017		1,395,307		$	13.84
Granted at fair market value		691,502		$	12.23
Vested(1)		(18,968)		$	12.90
Forfeited		(29,267)		$	13.63
Balance as of March 31, 2017		2,038,574		$	13.31

	Number of Options		Weighted Average Exercise Price (in dollars)			Weighted Average Remaining Contractual Terms (in years)		Aggregate Intrinsic Value (in $ thousands)
Balance as of January 1, 2017		2,720,514		$	13.58
Forfeited		(12,836)		$	13.65
Balance as of March 31, 2017		2,707,678		$	13.58		7.66		$	766
Exercisable as of March 31, 2017		755,986		$	12.99		4.92			766
Expected to vest as of March 31, 2017		1,951,692		$	13.81		8.72			—

	Three Months Ended March 31,						Change
(in $ thousands, except share data, Reported Segments and RevPas)	2017			2016						%
Net revenue		$	650,763		$	609,263		$	41,500		7
Operating income			98,870			79,868			19,002		24
Net income			55,863			17,181			38,682		*
Income per share – diluted (in $)			0.45			0.13			0.32		*
Adjusted EBITDA(1)			168,553			154,140			14,413		9
Adjusted Operating Income(2)			107,241			96,464			10,777		11
Adjusted Net Income(3)			64,357			50,955			13,402		26
Adjusted Income per Share – diluted(4) (in $)			0.51			0.41			0.10		24
Net cash provided by operating activities			95,022			26,204			68,818		*
Free Cash Flow(5)			71,413			3,683			67,730		*
Reported Segments (in thousands)			93,197			89,973			3,224		4
Travel Commerce Platform RevPas (in $)			6.67			6.43			0.24		4

	Three Months Ended March 31,						Change
(in $ thousands )	2017			2016			$			%
Air		$	474,475		$	443,884		$	30,591		7
Beyond Air			147,585			135,002			12,583		9
Travel Commerce Platform			622,060			578,886			43,174		7
Technology Services			28,703			30,377			(1,674)		(6)
Net revenue		$	650,763		$	609,263		$	41,500		7

	Segments (in thousands)								RevPas (in $)
	Three Months Ended March 31,				Change				Three Months Ended March 31,						Change
	2017		2016				%		2017			2016			$			%
Asia Pacific		19,208		16,989		2,219		13		$	7.86		$	7.56		$	0.30		4
Europe		23,497		23,133		364		2		$	8.61		$	8.42		$	0.19		2
Latin America and Canada		4,626		4,550		76		2		$	6.22		$	6.16		$	0.06		1
Middle East and Africa		9,476		9,721		(245)		(3)		$	8.82		$	7.56		$	1.26		17
International		56,807		54,393		2,414		4		$	8.20		$	7.81		$	0.39		5
United States		36,390		35,580		810		2		$	4.30		$	4.33		$	(0.03)		(1)
Travel Commerce Platform		93,197		89,973		3,224		4		$	6.67		$	6.43		$	0.24		4