<PAGE> 1
Filed by Travelocity.com Inc.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Act of 1934
Subject Company: Travelocity.com, Inc.
SEC File No. 333-95757
[Following is the text of slides describing Sabre Inc. that are
being presented to analysts, potential investors and others]
1
Technology that Travels
[Picture montage: man by computer, computer screen showing Internet tool bar,
computer keyboards, customer service representative, airplane taking off, high
speed train. Sabre logo in lower left hand corner.]
2
Management Team
Bill Hannigan, President and CEO
Jeffrey Jackson, Executive Vice President and CFO
Eric Speck, Executive Vice President Sales & Marketing
3
Sabre's Compelling Position
Well positioned to capitalize on industry trends and growth
o #1 distributor of travel in the world
o Leading Internet position
o Unique, industry specific IT solutions
o Deep industry knowledge and technology leadership
4
Benefits of Independence
o Increases opportunities to grow IT solutions business
o Improves strategic flexibility throughout the business
o Provides additional currency for mergers and acquisitions and partnering
o Strengthens the Sabre brand
<PAGE> 2
5
Our Business
$2.4 Billion in Revenue
[Pie Chart containing the following information:]
IT Solutions
39% of Revenue
o Software applications
o Consulting
o Outsourcing
o Web hosting
Travel Distribution
61% of Revenue
o Travel Agents
o Internet
o Corporations
Built on Sabre's technology leadership
6
What We Do
o Enable and Distribute Travel anywhere, anytime, through any channel
$75 billion in travel sales
38% global market share
over 400 million segments booked
over 30 million unique traveling consumers
450 airlines
54 car rental companies
220 tour operators
8 cruise lines serving
47,000 travel agents
33 railroads
47,000 hotels
7
What We Do
o Enable and Distribute Travel anywhere, anytime, through any channel
o Market and operate branded Internet sites
Leading B2C Travelocity.com
web-enable over 1,000 companies for E-commerce
leading B2B Sabre BTS
emerging B2C Sabre Virtually There
<PAGE> 3
8
What We Do
o Enable and Distribute Travel anywhere, anytime, through any channel
o Market and operate branded Internet sites
o Provide unique IT solutions
150 airline customers
200 software solutions
web-hosting over 700 sites sizeable opportunities
single largest technology cutover in travel history
9
Revenue Sources
<TABLE>
<CAPTION>
Travel Distribution IT Solutions
<S> <C>
o Fees paid by airlines and other travel suppliers--80% o Long-term outsourcing contracts--82%
o Volume Based o Application Development
o Through any Sabre Channel o Desktop
o Other Revenues--20% o Infrastructure
o Data to airline o IT Applications--11%
o Travel Agency Products o Reservations ASP--6%
o New revenue Streams--<1% o Transactions based
o Advertising o License Fees
o Non-booking fee based transaction fees o Web Hosting--<2%
</TABLE>
10
Anywhere, Anytime, Through any Channel
<TABLE>
<CAPTION>
Traveler Channel % of 1999 Suppliers
<S> <C> <C> <C> <C> <C>
[Picture of two Travel Agency 74% c [Double headed [Picture of an
business travelers R arrow] airplane]
with luggage] S
[Letters over
picture
Online Consumer 2-3% of a computer] [Double headed [Picture of a
arrow] tropical island]
Online Corporate < 1% [Double headed [Picture of a
arrow] car]
Supplier Direct 23% [Double headed [Picture of a
arrow] city skyline]
[Double headed [Picture of a
arrow] cruise ship]
</TABLE>
<PAGE> 4
11
Anywhere, Anytime, Through any Channel
<TABLE>
<CAPTION>
Traveler Channel Our Share Suppliers
<S> <C> <C> <C> <C> <C>
[Picture of two Travel Agency 38% S [Double headed [Picture of an
business travelers A arrow] airplane]
with luggage] B
R
E
[Letters
Online Consumer > 50% over picture of [Double headed [Picture of a
a computer] arrow] tropical island]
Online Corporate > 25% [Double headed [Picture of a
arrow] car]
Supplier Direct 18% [Double headed [Picture of a
arrow] city skyline]
[Double headed [Picture of a
arrow] cruise ship]
</TABLE>
12
Market Segmentation
[Chart with the following content:]
<TABLE>
<CAPTION>
Booking Tools Content Type
<S> <C> <C>
Business Agency Personalized Travel
Fortune 1000 Sabre BTS Bookable Internet
Traditional
Business Agency Personalized Travel
Small to Medium Travelocity.com Bookable Internet
Agency WebRes Traditional
Airline Sites
Business Agency Personalized Travel
SOHO Travelocity.com Bookable Internet
Agency WebRes Traditional
Airline Sites
Leisure Consumer Agency Personalized Travel
Travelocity.com Bookable Internet
Agency WebRes Traditional
Airline Sites
</TABLE>
<PAGE> 5
13
Industry Evolution
Travelers
o Multi-channel shopping
o Becoming more savvy
Corporations
o Cutting costs
o Challenged to integrate tools
Technology
o Accelerating pace of change
o Complex system integration
Travel Agents
o Consolidating
o Deploying new business models
o Exponential on-line growth
Airlines
o Forming alliances
o Cutting costs
o Maximizing revenues
o Using one-to-one marketing
o Going direct
[Words placed over picture montage of two business travelers, computer screen
showing Internet, computer, two customer service consultants with headsets.]
<PAGE> 6
14
Revenue Flow, Today
[Flow chart showing commission revenues flowing from Suppliers to Agency,
booking fees moving from Suppliers to Sabre, incentives flowing from Sabre to
Agency, trip fees flowing from Corporations to Sabre and service fees flowing
from Corporations to Agency.]
15
New Revenue Flow
[Flow chart showing commission revenues flowing from Suppliers to Agency,
booking fees flowing from Suppliers to Sabre, incentives moving from Sabre to
Agency, trip fees flowing from Corporations to Sabre and service fees flowing
from Corporations to Agency.
Column on Left with heading:]
New Revenue Sources
o E-Commerce Web Development and Hosting
o Customer Relationship Management
o Target Marketing Advertising Services
o Financial Settlement
[New Revenue Sources shown flowing into Sabre.]
16
Revenue Perspective
[Bar Chart with various colors used to depict the revenue attributable to IT
Solutions, Traditional Agency, Online Agency, Corporate and New Businesses.
Revenue amount is represented on the Y-axis, and the years 1999 and 2004 are on
the X-axis. The bar for 1999 is shaded to show revenue attributable to IT
Solutions and Traditional Agency. The bar for 2004 shows revenue attributable to
all five segments. There is an arrow pointing to a 12-14% increase between the
revenues in 1999 and 2004.]
17
Web Hosting
o $14B total U.S. by 2003
o Categories
o Managed/Shared (WebRes)
o Managed/Dedicated (Travelocity.com)
o Collocation
o Presently host over 700 sites, including the #3 E-commerce site
<PAGE> 7
18
Supporting Travel
Distribution and IT Solutions
Eric Speck
[Sabre logo in lower left hand corner]
19
Travel Agency Distribution
o market position - Strongest Global Market Share.
38% Global Share
[Background picture of continents.]
o North America 46%
o Latin America 52%
o Europe, Africa & Middle East 13%
o Asia/South Pacific 71%
20
Travel Agency Distribution
o market position - Strongest Global Market share
o strategy
o Transform from Bricks & Mortar to Web-enabled
o Leverage agency franchise to capture consumer
o Lower our distribution cost
o products
o Web Reservations: Every agency a virtual storefront
o Traveler Database: CRM and database marketing
o Sales Manager: One to One Marketing
21
Emerging Online Distribution
o market position
o Leading online travel site
o Leading corporate web product
o Preferred online transaction engine.
[Corporate logos on bottom half of slide: Travelocity.com, Sabre Business Travel
Solutions, Sabre Virtually There, Lowestfare.com, Cendant, Yahoo!, America
Online, CheapTickets Inc., American Airlines, US Airways, Sabre Connected]
<PAGE> 8
22
Emerging Online Distribution
o market position
o Leading online travel site
o Leading corporate web product
o Preferred online transaction engine
o strategy
o Create and capitalize on the world's largest consumer database
o Pursue first mover advantage in unoccupied spaces
o Leverage our market position
o products
o Travelocity.com
o Sabre Business Travel Solutions
o Virtually There: an itinerary-based travel portal
23
The New Travelocity.com
Clear category leader
#1 in members - 17 million registered
#1 in travel sales - $1.2 billion 1999
#1 in visitors - 7.4 million unique visitors/month
#1 in media sales - $20 million 1999
top 10 US travel agent
#1 in broadband content
[Screen pull of Travelocity.com Internet page]
24
New Travelocity.com Growth
Gross Travel Sales
Sequential quarterly growth of 24%
[Bar Graph containing the following content:]
<TABLE>
<CAPTION>
Quarter Gross Travel Sales of Travelocity and Preview Travel
<S> <C>
1Q98 Less than $100 million
2Q98 Approximately $100 million
3Q98 Between $100 and $200 million
4Q98 Between $100 and $200 million
1Q99 Approximately $200 million
2Q99 Between $200 and $300 million
3Q99 Between $300 and $400 million
4Q99 Between $300 and $400 million
</TABLE>
<PAGE> 9
25
U.S. On-Line Retail Growth
#1 Shopped Category On Web
Forrester
[Bar graph showing the increase in on-line retail growth for travel,
electronics, software, books and music. On the X-axis are the years: 1998, 1999,
2000, 2001, 2002 and 2003. On the Y-axis is revenue, in millions of dollars. For
each year, the bar with the most growth is travel, followed by electronics,
software, books and music. The travel bar starts at under $5 billion in 1998 and
increases to approximately $30 billion in 2003. The electronics bar starts at
under $5 billion in 1998 and increases to over $20 billion in 2003. The bars
representing software, books and music start under $5 billion, show increased
sales, and remain under $5 billion in 2003.]
26
3rd Largest E-commerce Site
[Bar graph with the following content:]
<TABLE>
<CAPTION>
Internet Site Reach %, January 2000
<S> <C>
Amazon 20.20
Ebay 15.90
New Travelocity.com* 9.3
Barnes & Noble 8.90
CDNow 6.30
Expedia 6.20
</TABLE>
Media Metrix January 2000
* Combined Preview Travel (without AOL Travel) and Travelocity.com - net of
duplication.]
27
Sabre BTS
o over 320 corporations
o 53 travel agency partners
o potential travel sales $4.5 billion
o 145% customer growth
o 1999 bookings 480% growth
[Lower right half of slide has a picture of a trip planning screen from the
Sabre web site.]
<PAGE> 10
28
Sabre BTS
Estimated market of $75B in airlines travel sales
[Pie chart with the following content:]
Available Market 84%
Penetrated Market Total 16%
(Actual Travel Booked 3.3%)
75% Growth of the Penetrated Market
29
Sabre BTS
o Leading share in both number of customers and ARC travel sales volume
Share of BTN 100 by Number of Customers
[Pie graph with the segments of the chart, from largest to smallest: Sabre BTS,
None, GetThere.com, AXI, E-Travel, Res Assist, Other, XOL, e-Res, Via World.]
30
Sabre BTS Growth
o Recent sequential monthly growth of 20% plus
o Early growth pattern similar to Travelocity.com.
[Line graph with months on the X-axis and segments on the Y-axis. There are two
lines, one representing BTS and the other representing Travelocity, both
increasing over time. The BTS line progresses from under 20,000 segments in
month 1 to over 80,000 segments in month 25. The Travelocity line progresses
from under 20,000 segments in month 1 to over 100,000 in month 25.]
31
Sabre Virtually There
o Personalized travel domain for travelers booked through Sabre
o New Sabre Advertising Model
o Leverages Travel Agency franchise to reach over 30 million unique travelers
o Travel Agents
o Sabre Powered online travel agents
o BTS and Travelocity.com
o Site provides
o Detailed itinerary
o Gate and arrival/departure info
o Destination information and content
o Maps and weather
o Merchant offers
<PAGE> 11
32
Virtually There
online travel domain customized for travelers
o launched November 1999
o 46,000 site visits per day
o reach 30 million unique travelers
o very low customer acquisition cost
o 97% user satisfaction
[On left of slide there is a screen pull of a travel reservation web page.]
33
Sabre Virtually There
Advertisers -
[logos of: MCI WorldCom; eBags; SuperShuttle.]
Number of Itineraries viewed
[Bar graph with the following content:]
Dec-99 between 200,000 and 400,000 itineraries viewed
Jan-00 between 600,000 and 800,000 itineraries viewed
Feb-00 (estimate) over 1,000,000 itineraries viewed
34
Supplier Direct Distribution
o market position:
o Leading reservation ASP for airlines
o Growing Web Hosting business
[Picture of a customer service representative wearing a headset and sitting at a
computer.]
o 46 airlines
o over 290 million passengers boarded
o web hosting 10 major airlines
<PAGE> 12
35
Supplier Direct Distribution
o market position
o Leading reservation ASP for airlines
o Growing Web Hosting business
o strategy
o Increase and grow reservation ASP
o Aggressively pursue web hosting services
o products
o Reservations ASP
o Web hosting services
o Sales Manager
o Best Fare Finder
36
Distribution Strategies
[Flow chart showing boxes, starting with:]
world's leading electronic travel distributor
[triangle pointing to:]
Rationalize the traditional travel agent channel
[triangle over:]
Preferred Transaction Engine
[pointing to:]
Broaden the distribution business
[triangle over:]
Innovative Internet Solutions
[pointing to:]
Reinvent and extend
[triangle pointing to:]
world class travel marketer
[Picture of a computer screen showing the Internet and a picture of a computer.]
37
IT Solution Customers
[Picture of a plane in the air.]
Airlines
o Virtually every major carrier in the world uses our products or services
o 3 of the Top 25 Airlines are outsourcing clients
[Picture of a plane parked at a gate.]
100+ Airports
o Collectively use more than 30 Sabre products.
[Picture of a high-speed train.]
8 Rail
o Represent 3 main rail types: high speed, traditional rail, and mass
transit.
[Picture of an tractor trailer truck on the highway.]
25 Logistic
o Customer types include shipping companies, motor carriers, and governments
<PAGE> 13
38
Industry Opportunity
o Size of market
o The top 200 spend approximately $8 billion on IT
o Approximately 20% of IT spend is outsourced
o Sabre has more than 50% of the outsourced IT spend
o IT Trends
o Traveler demands for new integrated products
o Importance of systems integration for alliances
o Airlines continued focus on cutting costs and revenue
optimization
[Picture in lower right corner of an airplane in the air.]
39
IT Applications and Outsourcing
o market position
o Industry leader in mission critical airline IT
o Leading transaction processing capabilities
o Proven large scale outsourcing expertise
o Firm foothold in Web hosting
[Below text, graphical icons labeled: Airports, Cargo, Flight Operations,
Pricing/Yield Management, Maintenance & Engineering, Distribution Channels,
Crews, Planning/Scheduling.]
<PAGE> 14
40
IT Applications and Outsourcing
o market position
o Industry leader in mission critical airline IT
o Leading transaction processing capabilities
o Proven large scale outsourcing expertise
o Firm foothold in Web hosting
o strategy
o Further integrate and modularize IT applications
o Build ASP services into additional functional areas
o Pursue alliance opportunities
o Aggressively grow Web hosting
o products
o Airline Operating Software
o Consulting Services
o Functional and Full IT Outsourcing
41
IT Solutions Business
[Pie chart with the following content:]
Applications Development 49%
Outsourcing--DP & Network 29%
Outsourcing--Desktop 14%
Reservations ASP 6%
Web Hosting 2%
42
IT Solutions Strategies
[Flow chart showing boxes, starting with:]
deep industry knowledge and expertise
[triangle pointing to:]
Grow software sales
[triangle over:]
Leverage Core Competencies
[pointing to:]
Develop ASP and functional outsourcing
[triangle over:]
Consulting Services
[pointing to:]
Build full IT outsourcing
[triangle pointing to:]
business process solution provider
[Two pictures of computer keyboards.]
<PAGE> 15
43
Financial review
Jeff Jackson
[Sabre logo in lower left corner.]
44
Financial Performance
[Two arrows pointing up. Over the first arrow:]
Revenue Growth
13.6% CAGR
[In middle of arrow a bar graph showing an increase from left to right with the
following written below the bars:] 95 PF, 96 PF, 97, 98, 99.
[At the top of the 99 bar:] 5.5%.
[Over the second arrow:]
EPS* Growth
13.9% CAGR.
[In the middle of the arrow a bar graph showing an increase from left to right
with the following labels under the bars:] 95 PF, 96 PF, 97, 98, 99.
*Excluding one-time items
45
Financial Performance
o Free cash flow of approximately $200 million annually
o Significant capital investments in products and technology
[Two graphs, one a line graph showing operating cash flow and the other a bar
graph showing free cash flow. Years 1996 through 1999 are marked on the X-axis,
and dollar amounts are listed on the Y-axis. The operating cash flow line is
under $400 million in 1996 and reaches approximately $600 million in 1999. The
bar graph shows free cash flow under $200 million in 1996 and increasing to
approximately $400 million in 1999.]
1999 includes after-tax gain of $86 million for sale of Equant stock
<PAGE> 16
46
Investment Initiatives
o Industry leading applications
o Customer focused offerings
o Richest source of travel content
o Fares, Bed & Breakfasts, Theatre
o Technology infrastructure:
o Scale, Performance and Reliability
o Access anywhere anytime
o Product and technology investments > $150 million
47
Current Transactions
o Travelocity.com
o 70% Sabre / 30% public
o 1999 pro-forma revenue $91 Million
o $1.2 Billion in travel sales
o New independence
o Upside potential from more market based pricing
o One time spin cost of $10 to $15 million
48
Revenue Growth Opportunities
o Core Travel Agency Channel
o International Growth
o Market Share Gains
o Significant E-commerce Growth
o Travelocity and BTS - exponential growth
o Virtually there - new revenue streams
o Enabler for other Internet initiative
o Strong growth upside in IT Solutions Business
o Grow and expand ASP Business
o Continue to build outsourcing business
o Web hosting
<PAGE> 17
49
Earnings Growth
o Feed bottom-line growth through
o Top line growth
o Global market share increases
o Emerging Internet businesses
o New revenue streams
o Growth in It
o Cost reduction initiatives
o Cost efficiencies in travel agent channel
o Overall cost reductions through operational efficiency
o Continue top and bottom line growth in the range of historical growth rates
- with upside potential
50
Sabre's Compelling Position
Well positioned to capitalize on industry trends and growth
#1 distributor of travel in the world
Leading Internet position
Unique, industry specific IT solutions
Deep industry knowledge and technology leadership
51
Technology that Travels
[Picture montage of man by computer, computer screen showing Internet language,
computer keyboards, customer service representative, airplane taking off, high
speed train. Sabre logo in lower left hand corner.]
<PAGE> 18
52
Forward Looking Statement
o Statements made during this presentation which are not purely historical
facts, including statements with respect to the financial outlook for 1999
and estimates for the year 2000, are forward-looking and subject to risks
and uncertainties. We claim the protection of the safe harbor for
forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995 for these statements. The following is a summary of
certain risks which could cause actual events or future results to differ
materially from those expressed in the forward-looking statements
o dependence on the successful integration of Travelocity.com and
Preview operations;
o changes in Travelocity.com's relationship with Sabre and its
affiliates;
o competition and technological innovation by our competitors;
o changes in our relationships with travel suppliers and strategic
partners;
o seasonality of the travel industry and booking revenues;
o sensitivity to general economic conditions and events that affect
airline travel;
o business combinations and strategic alliances by other industry
participants;
o risks associated with international operations; and
o legal and regulatory issues.
o Please refer to the reports on Forms 10-Q and 10-K that have been filed by
Sabre and preview with the Securities and Exchange Commission for a more
detailed discussion of these and other factors that could impact future
results.
o Investors are urged to read the proxy statement/prospectus included in the
Registration Statement on Form S-4, filed with the Securities and Exchange
Commission (SEC) in connection with the proposed merger, because it
contains important information. The proxy statement/prospectus is available
free of charge on the SEC's Web site (www.sec.gov) and from
Travelocity.com's Corporate Secretary. In addition, the identity of the
people who, under the SEC rules, may be considered participants in the
solicitation of Preview Travel stockholders in connection with the proposed
merger, and a description of their interests, is available in the proxy
statement/prospectus.
