News Column

Orbitz Confirms Layoffs After Tech Overhaul

Feb. 16, 2013

Samantha Bomkamp

Orbitz Worldwide Inc. confirmed Friday it is laying off some staffers after completing a major technology overhaul.

The online travel agency said in a statement that it is making "some targeted staffing adjustments" along with other cost reduction measures as its business runs more efficiently. That included eliminating some open positions as well as specific existing ones, the statement read.

A spokeswoman would not specify a number of affected employees. Media reports suggested it was around 70, or about 4 percent of its 1,600 employees.

The Chicago company said it also hiring in selected areas, including positions related to the launch of its new loyalty program.

Orbitz executives spoke about the company's broader cost cutting effort on a conference call with analysts after releasing its fourth-quarter earnings.

"These cost reductions position us well to achieve strong bottom-line performance, while at the same time being able to step up our marketing investments," CEO Barney Harford said. "This is particularly important given the increasing competitive intensity in the online travel space."

It expects to take one-time charges of between $4 million and $5 million related to the cost reductions.

Orbitz said Thursday its loss swelled in the fourth-quarter due to a huge writedown on the value of assets. But Wall Street was impressed with the growth in its hotel business, its biggest segment, as well as its forecast for the current quarter and full year. Shares jumped almost 17 percent. They added another 6 percent on Friday and continued their climb in after-hours trade.

Orbitz also said Friday that it is considering strategeic alternatives, including a possible sale of some or all of the Away Network. The Away Network's sites include Away.com, Trip.com, GORP.com, AdventureFinder.com.

sbomkamp@tribune.como -- Twitter: @SamWillTravel

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