Use these links to rapidly review the documentINDEX SABRE HOLDINGS CORPORATION

---

---

UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

---

FORM 10-Q

|ý | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ---------------------------------------------------------------------------------------

For the Quarterly Period Ended March 31, 2002.

OR

|o | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

For the Transition Period From To  to

Commission file number 1-12175.

---

LOGO

SABRE HOLDINGS CORPORATION(Exact name of registrant as specified in its charter)

Delaware(State or other jurisdiction of incorporation or organization)

75-2662240(I.R.S. Employer Identification No.)3150 Sabre Drive Southlake, Texas(Address of principal executive offices)

76092(Zip Code)


Registrant's telephone number, including area code(682) 605-1000

Not Applicable(Former name, former address and former fiscal year, if changed since last report)

---

Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter periods that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days. Yes ý    No o

Indicate
the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class
A Common Stock, $.01 par value144,480,759 as of May 9, 2002

---

---

---



INDEX    SABRE HOLDINGS CORPORATION



|PART I:   |  | FINANCIAL INFORMATION                                                                     
|--------- |  | ------------------------------------------------------------------------------------------
|Item 1.   |  | Financial Statements (Unaudited)                                                          
|          |  | Consolidated Balance SheetsMarch 31, 2002 and December 31, 2001                          
|          |  | Consolidated Statements of IncomeThree months ended March 31, 2002 and 2001              
|          |  | Condensed Consolidated Statement of Stockholders' EquityThree months ended March 31, 2002
|          |  | Consolidated Statements of Cash FlowsThree months ended March 31, 2002 and 2001          
|          |  | Notes to Consolidated Financial Statements                                                
|Item 2.   |  | Management's Discussion and Analysis of Financial Condition and Results of Operations     
|PART II:  |  | OTHER INFORMATION                                                                         
|Item 1.   |  | Legal Proceedings                                                                         
|Item 6.   |  | Exhibits and Reports on Form 8-K                                                          
|SIGNATURE

2

---



PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

SABRE HOLDINGS CORPORATION  CONSOLIDATED BALANCE SHEETS  (Unaudited) (In thousands)

|                                           |                                                                                                                                                                   | March 31,
2002 |                                            | December 31,
2001 |  
|------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------- | ------------------------------------------ | ----------------- | -
|Assets                                     |                                                                                                                                                                   |                |                                            |                   |  
|Current assets                             |                                                                                                                                                                   |                |                                            |                   |  
|                                           | Cash                                                                                                                                                              |                | $                                          | 20,319            |  
|                                           | Marketable securities                                                                                                                                             |                |                                            | 797,557           |  
|                                           | Accounts receivable, net                                                                                                                                          |                |                                            | 370,052           |  
|                                           | Prepaid expenses                                                                                                                                                  |                |                                            | 78,713            |  
|                                           | Deferred income taxes                                                                                                                                             |                |                                            | 44,880            |  
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|                                           |                                                                                                                                                                   |                | Total current assets                       |                   |  
|Property and equipment                     |                                                                                                                                                                   |                |                                            |                   |  
|                                           | Buildings and leasehold improvements                                                                                                                              |                |                                            | 155,710           |  
|                                           | Furniture, fixtures and equipment                                                                                                                                 |                |                                            | 40,523            |  
|                                           | Computer equipment                                                                                                                                                |                |                                            | 204,820           |  
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|                                           |                                                                                                                                                                   |                | 401,053                                    |                   |  
|                                           | Less accumulated depreciation and amortization                                                                                                                    |                |                                            | (178,709          | )
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|                                           |                                                                                                                                                                   |                | Total property and equipment               |                   |  
|Deferred income taxes                      |                                                                                                                                                                   |                |                                           |                   |  
|Investments in joint ventures              |                                                                                                                                                                   |                | 177,754                                    |                   |  
|Goodwill and intangible assets, net        |                                                                                                                                                                   |                | 698,616                                    |                   |  
|Other assets, net                          |                                                                                                                                                                   |                | 138,432                                    |                   |  
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|                                           |                                                                                                                                                                   |                | Total assets                               |                   | $
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|Liabilities and stockholders' equity       |                                                                                                                                                                   |                |                                            |                   |  
|Current liabilities                        |                                                                                                                                                                   |                |                                            |                   |  
|                                           | Accounts payable                                                                                                                                                  |                | $                                          | 176,667           |  
|                                           | Accrued compensation and related benefits                                                                                                                         |                |                                            | 55,502            |  
|                                           | Accrued subscriber incentives                                                                                                                                     |                |                                            | 92,180            |  
|                                           | Deferred revenues                                                                                                                                                 |                |                                            | 53,567            |  
|                                           | Other accrued liabilities                                                                                                                                         |                |                                            | 192,412           |  
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|                                           |                                                                                                                                                                   |                | Total current liabilities                  |                   |  
|Deferred income taxes                      |                                                                                                                                                                   |                | 29,960                                     |                   |  
|Pensions and other postretirement benefits |                                                                                                                                                                   |                | 104,481                                    |                   |  
|Notes payable                              |                                                                                                                                                                   |                | 395,034                                    |                   |  
|Other liabilities                          |                                                                                                                                                                   |                | 66,292                                     |                   |  
|Minority interests                         |                                                                                                                                                                   |                | 243,301                                    |                   |  
|Commitments and contingencies              |                                                                                                                                                                   |                |                                            |                   |  
|Stockholders' equity                       |                                                                                                                                                                   |                |                                            |                   |  
|                                           | Preferred stock: $0.01 par value; 20,000 shares authorized; no shares
    issued                                                                                  |                |                                            |                  |  
|                                           | Class A common stock, $0.01 par value; 250,000 shares authorized;
    133,962 and 133,527 shares issued at March 31, 2002 and
    December 31, 2001, respectively |                |                                            | 1,356             |  
|                                           | Additional paid-in capital                                                                                                                                        |                |                                            | 830,856           |  
|                                           | Retained earnings                                                                                                                                                 |                |                                            | 315,373           |  
|                                           | Accumulated other comprehensive income                                                                                                                            |                |                                            | 1,165             |  
|                                           | Less treasury stock at cost: 384 shares                                                                                                                           |                |                                            | (9,479            | )
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|                                           |                                                                                                                                                                   |                | Total stockholders' equity                 |                   |  
|                                           |                                                                                                                                                                   |                |                                            |                   |  
|                                           |                                                                                                                                                                   |                | Total liabilities and stockholders' equity |                   | $
|                                           |                                                                                                                                                                   |                |                                            |                   |  

See Notes to Consolidated Financial Statements

3

---



SABRE HOLDINGS CORPORATION  CONSOLIDATED STATEMENTS OF INCOME  (Unaudited) (In thousands, except per share amounts)

|                                                                                                 |                                                  | Three Months Ended March 31, |        
|------------------------------------------------------------------------------------------------ | ------------------------------------------------ | ---------------------------- | -------
|
|Revenues                                                                                         |                                                  | $                            | 539,367
|Operating expenses                                                                               |                                                  |                              |        
|                                                                                                 | Cost of revenues                                 |                              |        
|                                                                                                 | Selling, general and administrative              |                              |        
|                                                                                                 | Amortization of goodwill and intangible assets   |                              |        
|                                                                                                 |                                                  |                              |        
|                                                                                                 |                                                  | Total operating expenses     |        
|                                                                                                 |                                                  |                              |        
|Operating income                                                                                 |                                                  |                              | 119,994
|Other income (expense)                                                                           |                                                  |                              |        
|                                                                                                 | Interest income                                  |                              |        
|                                                                                                 | Interest expense                                 |                              |        
|                                                                                                 | Other, net                                       |                              |        
|                                                                                                 |                                                  |                              |        
|                                                                                                 |                                                  | Total other income (expense) |        
|Minority interests                                                                               |                                                  |                              | 847    
|                                                                                                 |                                                  |                              |        
|Income from continuing operations before income taxes                                            |                                                  |                              | 142,047
|Provision for income taxes                                                                       |                                                  |                              | 54,660 
|                                                                                                 |                                                  |                              |        
|Income from continuing operations                                                                |                                                  |                              | 87,387 
|Income from discontinued operations, net                                                         |                                                  |                              |       
|                                                                                                 |                                                  |                              |        
|Income before cumulative effect of change in accounting method                                   |                                                  |                              | 87,387 
|Cumulative effect of change in accounting method, net of minority
    interests and income taxes |                                                  |                              |       
|                                                                                                 |                                                  |                              |        
|Net earnings                                                                                     |                                                  | $                            | 87,387 
|                                                                                                 |                                                  |                              |        
|Earnings per common sharebasic                                                                  |                                                  |                              |        
|                                                                                                 | Income from continuing operations                |                              | $      
|                                                                                                 | Income from discontinued operations              |                              |        
|                                                                                                 | Cumulative effect of change in accounting method |                              |        
|                                                                                                 |                                                  |                              |        
|                                                                                                 | Net earnings                                     |                              | $      
|                                                                                                 |                                                  |                              |        
|Earnings per common sharediluted                                                                |                                                  |                              |        
|                                                                                                 | Income from continuing operations                |                              | $      
|                                                                                                 | Income from discontinued operations              |                              |        
|                                                                                                 | Cumulative effect of change in accounting method |                              |        
|                                                                                                 |                                                  |                              |        
|                                                                                                 | Net earnings                                     |                              | $      
|                                                                                                 |                                                  |                              |        

See Notes to Consolidated Financial Statements

4

---



SABRE HOLDINGS CORPORATION  CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY  THREE MONTHS ENDED MARCH 31, 2002  (Unaudited) (In thousands)

|                                                                                                                                         |                                                                                             | Class A
Common
Stock |       | Additional
Paid-in
Capital |   | Retained
Earnings |   | Accumulated
Other
Comprehensive
Income |         | Treasury
Stock |   | Total |       
|---------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------- | -------------------- | ----- | -------------------------- | - | ----------------- | - | -------------------------------------- | ------- | -------------- | - | ----- | ------
|Balance at December 31, 2001                                                                                                             |                                                                                             | $                    | 1,351 |                            | $ | 818,742           |   | $                                      | 227,986 |                | $ | 3,176 |       
|Issuance of 506 shares of Class A
    common stock pursuant to stock
    option, restricted stock incentive
    and stock purchase plans |                                                                                             |                      | 5     |                            |   | 6,910             |   |                                        |        |                |   |      |       
|Tax benefit from exercise of employee
    stock options                                                                                  |                                                                                             |                      |      |                            |   | 1,919             |   |                                        |        |                |   |      |       
|Comprehensive income:                                                                                                                    |                                                                                             |                      |       |                            |   |                   |   |                                        |         |                |   |       |       
|                                                                                                                                         | Net earnings                                                                                |                      |       |                           |   |                   |  |                                        |         | 87,387         |   |       |      
|                                                                                                                                         | Unrealized loss on foreign currency
    forward contracts, net of deferred
    income taxes |                      |       |                           |   |                   |  |                                        |         |               |   |       | (106  
|                                                                                                                                         | Unrealized loss on investments, net
    of deferred income taxes                            |                      |       |                           |   |                   |  |                                        |         |               |   |       | (1,859
|                                                                                                                                         | Unrealized foreign currency
    translation loss                                            |                      |       |                           |   |                   |  |                                        |         |               |   |       | (46   
|                                                                                                                                         |                                                                                             |                      |       |                            |   |                   |   |                                        |         |                |   |       |       
|Total comprehensive income                                                                                                               |                                                                                             |                      |       |                            |   |                   |   |                                        |         |                |   |       |       
|                                                                                                                                         |                                                                                             |                      |       |                            |   |                   |   |                                        |         |                |   |       |       
|Other                                                                                                                                    |                                                                                             |                      |      |                            |   | 3,285             |   |                                        |        |                |   |      |       
|                                                                                                                                         |                                                                                             |                      |       |                            |   |                   |   |                                        |         |                |   |       |       
|Balance at March 31, 2002                                                                                                                |                                                                                             | $                    | 1,356 |                            | $ | 830,856           |   | $                                      | 315,373 |                | $ | 1,165 |       
|                                                                                                                                         |                                                                                             |                      |       |                            |   |                   |   |                                        |         |                |   |       |       

See Notes to Consolidated Financial Statements.

5

---



SABRE HOLDINGS CORPORATION  CONSOLIDATED STATEMENTS OF CASH FLOWS  (Unaudited) (In thousands)

|                                                                                   |                                                       | Three Months Ended March 31,                   |         
|---------------------------------------------------------------------------------- | ----------------------------------------------------- | ---------------------------------------------- | --------
|
|Operating Activities                                                               |                                                       |                                                |         
|Net earnings                                                                       |                                                       | $                                              | 87,387  
|Adjustments to reconcile net earnings to cash provided by operating
    activities |                                                       |                                                |         
|                                                                                   | Depreciation and amortization                         |                                                |         
|                                                                                   | Deferred income taxes                                 |                                                |         
|                                                                                   | Gain on sale of former headquarters building          |                                                |         
|                                                                                   | Minority interests                                    |                                                |         
|                                                                                   | Tax benefit from exercise of stock options            |                                                |         
|                                                                                   | Cumulative effect of change in accounting method, net |                                                |         
|                                                                                   | Other                                                 |                                                |         
|                                                                                   | Changes in operating assets and liabilities           |                                                |         
|                                                                                   |                                                       | Accounts receivable                            |         
|                                                                                   |                                                       | Prepaid expenses                               |         
|                                                                                   |                                                       | Other assets                                   |         
|                                                                                   |                                                       | Accrued compensation and related benefits      |         
|                                                                                   |                                                       | Accounts payable and other accrued liabilities |         
|                                                                                   |                                                       | Pensions and other postretirement benefits     |         
|                                                                                   |                                                       | Other liabilities                              |         
|                                                                                   |                                                       |                                                |         
|                                                                                   | Cash provided by operating activities                 |                                                |         
|Investing Activities                                                               |                                                       |                                                |         
|Additions to property and equipment                                                |                                                       |                                                | (12,132 
|Business combinations, net of cash acquired                                        |                                                       |                                                | (35,907 
|Proceeds from sale of former headquarters building                                 |                                                       |                                                | 80,000  
|Proceeds from sale of minority interest in Sabre Pacific                           |                                                       |                                                | 23,466  
|Purchases of marketable securities                                                 |                                                       |                                                | (660,350
|Sales of marketable securities                                                     |                                                       |                                                | 508,359 
|Other investing activities, net                                                    |                                                       |                                                | 23,325  
|                                                                                   |                                                       |                                                |         
|                                                                                   | Cash used for investing activities                    |                                                |         
|Financing Activities                                                               |                                                       |                                                |         
|Proceeds from issuance of common stock                                             |                                                       |                                                | 6,915   
|Other financing activities, net                                                    |                                                       |                                                | (14,529 
|                                                                                   |                                                       |                                                |         
|                                                                                   | Cash provided by (used for) financing activities      |                                                |         
|Increase in cash                                                                   |                                                       |                                                | 1,464   
|Cash at beginning of period                                                        |                                                       |                                                | 18,855  
|                                                                                   |                                                       |                                                |         
|Cash at end of period                                                              |                                                       | $                                              | 20,319  
|                                                                                   |                                                       |                                                |         

See Notes to Consolidated Financial Statements

6

---



SABRE HOLDINGS CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Unaudited)

1. General Information



2. Summary of Significant Accounting Policies



7

---



|                                                                                  |          | Three Months Ended March 31,                                          
|--------------------------------------------------------------------------------- | -------- | ----------------------------------------------------------------------
|
|Reported income from continuing operations                                        |          | $                                                                     
|Add back goodwill and indefinite lived intangible assets amortization, net of tax |          |                                                                       
|                                                                                  |          |                                                                       
|Adjusted income from continuing operations                                        |          | $                                                                     
|                                                                                  |          |                                                                       
|Reported net earnings                                                             |          | $                                                                     
|Add back goodwill and indefinite lived intangible assets amortization, net of tax |          |                                                                       
|                                                                                  |          |                                                                       
|Adjusted net earnings                                                             |          | $                                                                     
|                                                                                  |          |                                                                       
|Earnings per share                                                                |          |                                                                       
|                                                                                  | Basic:   |                                                                       
|                                                                                  |          | Reported income from continuing operations                            
|                                                                                  |          | Add back goodwill and indefinite lived assets amortization, net of tax
|                                                                                  |          |                                                                       
|                                                                                  |          | Adjusted income from continuing operations                            
|                                                                                  |          |                                                                       
|                                                                                  |          | Reported net earnings                                                 
|                                                                                  |          | Add back goodwill and indefinite lived assets amortization, net of tax
|                                                                                  |          |                                                                       
|                                                                                  |          | Adjusted net earnings                                                 
|                                                                                  |          |                                                                       
|                                                                                  | Diluted: |                                                                       
|                                                                                  |          | Reported income from continuing operations                            
|                                                                                  |          | Add back goodwill and indefinite lived assets amortization, net of tax
|                                                                                  |          |                                                                       
|                                                                                  |          | Adjusted income from continuing operations                            
|                                                                                  |          |                                                                       
|                                                                                  |          | Reported net earnings                                                 
|                                                                                  |          | Add back goodwill and indefinite lived assets amortization, net of tax
|                                                                                  |          |                                                                       
|                                                                                  |          | Adjusted net earnings                                                 
|                                                                                  |          |                                                                       

8

---



|                             |                                 |  |         | March 31, 2002 |         | December 31, 2001 |  
|---------------------------- | ------------------------------- |  | ------- | -------------- | ------- | ----------------- | -
|
|Not Subject to Amortization: |                                 |  |         |                |         |                   |  
|                             | Goodwill                        |  |        |                | $       | 666,885           |  
|                             | Tradenames/trademarks           |  |        |                |         | 7,682             |  
|                             |                                 |  |         |                |         |                   |  
|                             |                                 |  |         |                | 674,567 |                   |  
|Subject to Amortization:     |                                 |  |         |                |         |                   |  
|                             | Purchased technology            |  | 4 years |                |         | 125,146           |  
|                             | Acquired customer relationships |  | 7 years |                |         | 32,820            |  
|                             | Non-compete agreements          |  | 4 years |                |         | 17,059            |  
|                             | Acquired contracts              |  | 3 years |                |         | 8,261             |  
|                             |                                 |  |         |                |         |                   |  
|                             |                                 |  |         |                | 183,286 |                   |  
|                             |                                 |  |         |                |         |                   |  
|Total                        |                                 |  |         | $              | 857,353 |                   | $
|                             |                                 |  |         |                |         |                   |  



2002

$
45,4222003


37,6372004


32,0892005


7,8332006


3,838


9

---



|                                   |                                | Travel
Marketing and
Distribution |   | Travelocity.com |  | GetThere |         | Airline
Solutions |   | Total   |  
|---------------------------------- | ------------------------------ | --------------------------------- | - | --------------- |  | -------- | ------- | ----------------- | - | ------- | -
|Three months ended March 31, 2002: |                                |                                   |   |                 |  |          |         |                   |   |         |  
|                                   | Balance at beginning of period |                                   | $ | 123,719         |  | $        | 97,602  |                   | $ | 401,740 |  
|                                   | Goodwill acquired              |                                   |   |                |  |          | 41,117  |                   |   |        |  
|                                   | Goodwill adjustments           |                                   |   |                |  |          |        |                   |   | (869    | )
|                                   |                                |                                   |   |                 |  |          |         |                   |   |         |  
|                                   | Balance at end of period       |                                   | $ | 123,719         |  | $        | 138,719 |                   | $ | 400,871 |  
|                                   |                                |                                   |   |                 |  |          |         |                   |   |         |  



3. Discontinued Operations



10

---



Three Months Ended
March 31, 2001Revenues

$
181,273Income before provision for income taxes

$
22,224Provision for income taxes


8,592Income from discontinued operations

$
13,632


4. Significant Events

Acquisition of Site59



Working capital acquired

$
1,770Long term assets


2,147Goodwill and other intangible assets


38,850Long term liabilities


(76
)Total Purchase Price

$
42,691




Events of September 11, 2001



11

---



Sale of Previous Headquarters



5. Income Taxes



Three Months Ended March 31,2002

2001Income tax provision at statutory federal income
    tax rate

$
49,716

$
10,593State income taxes, net of federal benefit


4,308


1,779Nondeductible goodwill amortization





17,415Other, net


636


68Total provision for income taxes

$
54,660

$
29,855


6. Derivatives



12

---



Asset/(Liability)
March 31,2002

2001HRN Warrants

$
2,734

$
21,400Foreign currency forwards


185


(913
)Interest rate swaps


(2,532
)

$
387

$
20,487




7. Earnings Per Share



Three Months Ended
March 31,2002

2001Denominator for basic earnings per common
    shareweighted-average shares

133,320

130,847Dilutive effect of stock awards and options

3,159

2,511Denominator for diluted earnings per common
    shareadjusted weighted-average shares

136,479

133,358


13

---

8. Segment Reporting



14

---



|                                                         |                                      | Three Months Ended
March 31, |  
|-------------------------------------------------------- | ------------------------------------ | ---------------------------- | -
|
|Revenues from external customers:                        |                                      |                              |  
|                                                         | Travel Marketing and Distribution    |                              | $
|                                                         | Travelocity.com                      |                              |  
|                                                         | GetThere                             |                              |  
|                                                         | Airline Solutions                    |                              |  
|                                                         |                                      |                              |  
|                                                         |                                      | Total                        |  
|                                                         |                                      |                              |  
|Intersegment revenues:                                   |                                      |                              |  
|                                                         | Travel Marketing and Distribution    |                              | $
|                                                         | Travelocity.com                      |                              |  
|                                                         | GetThere                             |                              |  
|                                                         | Airline Solutions                    |                              |  
|                                                         |                                      |                              |  
|                                                         |                                      | Total                        |  
|                                                         |                                      |                              |  
|Equity in net income of equity method investees:         |                                      |                              |  
|                                                         | Travel Marketing and Distribution    |                              | $
|                                                         | Travelocity.com                      |                              |  
|                                                         |                                      |                              |  
|                                                         |                                      | Total                        |  
|                                                         |                                      |                              |  
|Total consolidated revenues:                             |                                      |                              |  
|                                                         | Travel Marketing and Distribution    |                              | $
|                                                         | Travelocity.com                      |                              |  
|                                                         | GetThere                             |                              |  
|                                                         | Airline Solutions                    |                              |  
|                                                         | Elimination of intersegment revenues |                              |  
|                                                         |                                      |                              |  
|                                                         |                                      | Total                        |  
|                                                         |                                      |                              |  
|Segment operating income (loss) excluding special items: |                                      |                              |  
|                                                         | Travel Marketing and Distribution    |                              | $
|                                                         | Travelocity.com                      |                              |  
|                                                         | GetThere                             |                              |  
|                                                         | Airline Solutions                    |                              |  
|                                                         | Net corporate allocations            |                              |  
|                                                         |                                      |                              |  
|                                                         |                                      | Total                        |  
|                                                         |                                      |                              |  

15

---



|                                      |                                             | Three Months Ended
March 31,            |                    
|------------------------------------- | ------------------------------------------- | --------------------------------------- | -------------------
|
|Travel Marketing and Distribution:    |                                             |                                         |                    
|                                      | Goodwill and other intangibles amortization |                                         | $                  
|                                      | Stock compensation                          |                                         |                    
|                                      |                                             |                                         |                    
|                                      |                                             | Total Travel Marketing and Distribution |                    
|                                      |                                             |                                         |                    
|Travelocity.com:                      |                                             |                                         |                    
|                                      | Goodwill and other intangibles amortization |                                         |                    
|                                      | Tender offer expenses                       |                                         |                    
|                                      | Stock compensation                          |                                         |                    
|                                      |                                             |                                         |                    
|                                      |                                             | Total Travelocity.com                   |                    
|                                      |                                             |                                         |                    
|GetThere:                             |                                             |                                         |                    
|                                      | Goodwill and other intangibles amortization |                                         |                    
|                                      | Stock compensation                          |                                         |                    
|                                      | Severance and integration expenses          |                                         |                    
|                                      |                                             |                                         |                    
|                                      |                                             | Total GetThere                          |                    
|                                      |                                             |                                         |                    
|Corporate:                            |                                             |                                         |                    
|                                      | Goodwill and other intangibles amortization |                                         |                    
|                                      | Stock compensation                          |                                         |                    
|                                      |                                             |                                         |                    
|                                      |                                             | Total Corporate                         |                    
|                                      |                                             |                                         |                    
|                                      |                                             |                                         | Total special items
|                                      |                                             |                                         |                    
|Consolidated operating income (loss): |                                             |                                         |                    
|                                      | Travel Marketing and Distribution           |                                         | $                  
|                                      | Travelocity.com                             |                                         |                    
|                                      | GetThere                                    |                                         |                    
|                                      | Airline Solutions                           |                                         |                    
|                                      | Corporate Allocations                       |                                         |                    
|                                      |                                             |                                         |                    
|                                      |                                             | Total                                   |                    
|                                      |                                             |                                         |                    

9. Subsequent Events

Tender Offer for Travelocity.com Common Stock



16

---

Equity Offering



10. Supplemental Guarantor/Non-Guarantor Financial Information



17

---

UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEETS
MARCH 31, 2002
(in thousands)

|                                               |                                                | Sabre
Holdings            |           | Sabre Inc. |           | Non-
Guarantor
Subsidiaries |            | Eliminating
Entries |           | Sabre
Consolidated
|---------------------------------------------- | ---------------------------------------------- | ------------------------- | --------- | ---------- | --------- | --------------------------- | ---------- | ------------------- | --------- | ------------------
|Assets                                         |                                                |                           |           |            |           |                             |            |                     |           |                   
|Current assets                                 |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               | Cash and marketable securities                 |                           | $         | (2,944     | )         | $                           | 715,532    |                     | $         | 105,288           
|                                               | Accounts receivabletrade, net                 |                           |           |           |           |                             | 259,288    |                     |           | 110,764           
|                                               | Intercompany accounts receivable
    (payable) |                           |           | 1,075,675  |           |                             | (1,406,168 | )                   |           | 330,493           
|                                               | Prepaid expenses                               |                           |           |           |           |                             | 30,579     |                     |           | 48,134            
|                                               | Deferred income taxes                          |                           |           |           |           |                             | 44,793     |                     |           | 87                
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               |                                                | Total current assets      |           |            | 1,072,731 |                             |            | (355,976            | )         |                   
|Property and equipment, net                    |                                                |                           |          |            |           | 171,431                     |            |                     | 50,913    |                   
|Deferred income taxes                          |                                                |                           |          |            |           |                            |            |                     |          |                   
|Investments in joint ventures                  |                                                |                           |          |            |           | 12,069                      |            |                     | 165,685   |                   
|Goodwill and intangible assets, net            |                                                |                           |          |            |           | 9,084                       |            |                     | 689,532   |                   
|Investments in subsidiaries                    |                                                |                           | 462,320   |            |           | 1,152,801                   |            |                     |          |                   
|Other assets, net                              |                                                |                           | 2,970     |            |           | 87,847                      |            |                     | 47,615    |                   
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|Total assets                                   |                                                | $                         | 1,538,021 |            | $         | 1,077,256                   |            | $                   | 1,548,511 |                   
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|Liabilities and stockholders' equity           |                                                |                           |           |            |           |                             |            |                     |           |                   
|Current liabilities                            |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               | Accounts payable                               |                           | $         |           |           | $                           | 143,112    |                     | $         | 33,555            
|                                               | Accrued compensation and related
    benefits  |                           |           |           |           |                             | 44,284     |                     |           | 11,218            
|                                               | Other accrued liabilities                      |                           |           |           |           |                             | 258,006    |                     |           | 80,153            
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               |                                                | Total current liabilities |           |            |          |                             |            | 445,402             |           |                   
|Deferred income taxes                          |                                                |                           |          |            |           | 47,852                      |            |                     | (17,892   | )                 
|Pensions and other postretirement
    benefits |                                                |                           |          |            |           | 103,661                     |            |                     | 820       |                   
|Other liabilities                              |                                                |                           | 3,716     |            |           | 18,021                      |            |                     | 44,555    |                   
|Minority interests                             |                                                |                           |          |            |           |                            |            |                     | 243,301   |                   
|Notes payable                                  |                                                |                           | 395,034   |            |           |                            |            |                     |          |                   
|Stockholders' equity                           |                                                |                           | 1,139,271 |            |           | 462,320                     |            |                     | 1,152,801 |                   
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               | Total liabilities and stockholders'
    equity |                           | $         | 1,538,021  |           | $                           | 1,077,256  |                     | $         | 1,548,511         
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   

18

---

UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 2001
(in thousands)

|                                               |                                                | Sabre
Holdings            |           | Sabre Inc. |           | Non-
Guarantor
Subsidiaries |            | Eliminating
Entries |           | Sabre
Consolidated
|---------------------------------------------- | ---------------------------------------------- | ------------------------- | --------- | ---------- | --------- | --------------------------- | ---------- | ------------------- | --------- | ------------------
|Assets                                         |                                                |                           |           |            |           |                             |            |                     |           |                   
|Current assets                                 |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               | Cash and marketable securities                 |                           | $         |           |           | $                           | 543,196    |                     | $         | 123,691           
|                                               | Accounts receivabletrade, net                 |                           |           |           |           |                             | 238,747    |                     |           | 89,069            
|                                               | Intercompany accounts receivable
    (payable) |                           |           | 1,074,130  |           |                             | (1,406,885 | )                   |           | 332,755           
|                                               | Prepaid expenses                               |                           |           |           |           |                             | 18,120     |                     |           | 33,445            
|                                               | Deferred income taxes                          |                           |           |           |           |                             | 45,740     |                     |           | 230               
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               |                                                | Total current assets      |           |            | 1,074,130 |                             |            | (561,082            | )         |                   
|                                               | Property and equipment, net                    |                           |           |           |           |                             | 232,434    |                     |           | 56,015            
|                                               | Investments in joint ventures                  |                           |           |           |           |                             | 12,353     |                     |           | 157,596           
|                                               | Goodwill and intangible assets, net            |                           |           |           |           |                             | 9,626      |                     |           | 662,519           
|                                               | Investments in subsidiaries                    |                           |           | 372,556    |           |                             | 1,132,522  |                     |           |                  
|                                               | Other assets, net                              |                           |           | 5,845      |           |                             | 76,545     |                     |           | 70,846            
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|Total assets                                   |                                                | $                         | 1,452,531 |            | $         | 902,398                     |            | $                   | 1,526,166 |                   
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|Liabilities and stockholders' equity           |                                                |                           |           |            |           |                             |            |                     |           |                   
|Current liabilities                            |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               | Accounts payable                               |                           | $         |           |           | $                           | 136,608    |                     | $         | 22,231            
|                                               | Accrued compensation and related
    benefits  |                           |           |           |           |                             | 59,184     |                     |           | 14,090            
|                                               | Other accrued liabilities                      |                           |           | 9,347      |           |                             | 219,651    |                     |           | 103,345           
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|                                               |                                                | Total current liabilities |           |            | 9,347     |                             |            | 415,443             |           |                   
|Pensions and other postretirement
    benefits |                                                |                           |          |            |           | 88,362                      |            |                     | 394       |                   
|Other liabilities                              |                                                |                           | 1,033     |            |           | 26,037                      |            |                     | 33,868    |                   
|Minority interests                             |                                                |                           |          |            |           |                            |            |                     | 219,716   |                   
|Notes payable                                  |                                                |                           | 400,375   |            |           |                            |            |                     |          |                   
|Stockholders' equity                           |                                                |                           | 1,041,776 |            |           | 372,556                     |            |                     | 1,132,522 |                   
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   
|Total liabilities and stockholders'
    equity |                                                | $                         | 1,452,531 |            | $         | 902,398                     |            | $                   | 1,526,166 |                   
|                                               |                                                |                           |           |            |           |                             |            |                     |           |                   

19

---



UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2002
(in thousands)

|                                                                 |                          | Sabre
Holdings               |        | Sabre Inc. |        | Non-
Guarantor
Subsidiaries |         | Eliminating
Entries |         | Sabre
Consolidated |      
|---------------------------------------------------------------- | ------------------------ | ---------------------------- | ------ | ---------- | ------ | --------------------------- | ------- | ------------------- | ------- | ------------------ | -----
|Revenues                                                         |                          | $                            |       |            | $      | 425,492                     |         | $                   | 212,737 |                    | $    
|Operating expenses                                               |                          |                              | 338    |            |        | 328,489                     |         |                     | 189,408 |                    |      
|                                                                 |                          |                              |        |            |        |                             |         |                     |         |                    |      
|Operating income (loss)                                          |                          |                              | (338   | )          |        | 97,003                      |         |                     | 23,329  |                    |      
|Other income (expense)                                           |                          |                              |        |            |        |                             |         |                     |         |                    |      
|                                                                 | Interest income          |                              |        | 8,536      |        |                             | 5,722   |                     |         | 5,249              |      
|                                                                 | Interest expense         |                              |        | (5,024     | )      |                             | (12,717 | )                   |         | (448               | )    
|                                                                 | Income from subsidiaries |                              |        | 85,296     |        |                             | 20,278  |                     |         |                   |      
|                                                                 | Other, net               |                              |        |           |        |                             | 16,406  |                     |         | 3,482              |      
|                                                                 |                          |                              |        |            |        |                             |         |                     |         |                    |      
|                                                                 |                          | Total other income (expense) |        |            | 88,808 |                             |         | 29,689              |         |                    | 8,283
|Minority interests                                               |                          |                              |       |            |        |                            |         |                     | 847     |                    |      
|                                                                 |                          |                              |        |            |        |                             |         |                     |         |                    |      
|Income (loss) from continuing
    operations before income taxes |                          |                              | 88,470 |            |        | 126,692                     |         |                     | 32,459  |                    |      
|Provision for income taxes                                       |                          |                              | 1,083  |            |        | 41,396                      |         |                     | 12,181  |                    |      
|                                                                 |                          |                              |        |            |        |                             |         |                     |         |                    |      
|Net income (loss)                                                |                          | $                            | 87,387 |            | $      | 85,296                      |         | $                   | 20,278  |                    | $    
|                                                                 |                          |                              |        |            |        |                             |         |                     |         |                    |      

20

---

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF INCOME  FOR THE THREE MONTHS ENDED MARCH 31, 2001  (in thousands)

|                                                                                                     |                          | Sabre
Holdings               |        | Sabre Inc. |        | Non-
Guarantor
Subsidiaries |         | Eliminating
Entries |         | Sabre
Consolidated |     
|---------------------------------------------------------------------------------------------------- | ------------------------ | ---------------------------- | ------ | ---------- | ------ | --------------------------- | ------- | ------------------- | ------- | ------------------ | ----
|Revenues                                                                                             |                          | $                            |       |            | $      | 452,372                     |         | $                   | 207,896 |                    | $   
|Operating expenses                                                                                   |                          |                              | 172    |            |        | 382,185                     |         |                     | 235,124 |                    |     
|                                                                                                     |                          |                              |        |            |        |                             |         |                     |         |                    |     
|Operating income (loss)                                                                              |                          |                              | (172   | )          |        | 70,187                      |         |                     | (27,228 | )                  |     
|Other income (expense)                                                                               |                          |                              |        |            |        |                             |         |                     |         |                    |     
|                                                                                                     | Interest income          |                              |        | 8,643      |        |                             | 2,254   |                     |         | 7,213              |     
|                                                                                                     | Interest expense         |                              |        |           |        |                             | (30,417 | )                   |         | (365               | )   
|                                                                                                     | Income from subsidiaries |                              |        | 11,568     |        |                             | (27,830 | )                   |         |                   |     
|                                                                                                     | Other, net               |                              |        |           |        |                             | (2,001  | )                   |         | (7,707             | )   
|                                                                                                     |                          |                              |        |            |        |                             |         |                     |         |                    |     
|                                                                                                     |                          | Total other income (expense) |        |            | 20,211 |                             |         | (57,994             | )       |                    | (859
|Minority interests                                                                                   |                          |                              |       |            |        |                            |         |                     | 7,787   |                    |     
|                                                                                                     |                          |                              |        |            |        |                             |         |                     |         |                    |     
|Income (loss) from continuing
    operations before income taxes                                     |                          |                              | 20,039 |            |        | 12,193                      |         |                     | (20,300 | )                  |     
|Provision for income taxes                                                                           |                          |                              | 2,891  |            |        | 15,688                      |         |                     | 11,276  |                    |     
|                                                                                                     |                          |                              |        |            |        |                             |         |                     |         |                    |     
|Income (loss) from continuing
    operations                                                         |                          |                              | 17,148 |            |        | (3,495                      | )       |                     | (31,576 | )                  |     
|Income (loss) from discontinued
    operations, net                                                  |                          |                              |       |            |        | 15,063                      |         |                     | 643     |                    |     
|                                                                                                     |                          |                              |        |            |        |                             |         |                     |         |                    |     
|Income before cumulative effect of
    change in accounting method                                   |                          |                              | 17,148 |            |        | 11,568                      |         |                     | (30,933 | )                  |     
|Cumulative effect of change in
    accounting method, net of minority
    interests and income taxes |                          |                              |       |            |        |                            |         |                     | 3,103   |                    |     
|                                                                                                     |                          |                              |        |            |        |                             |         |                     |         |                    |     
|Net income (loss)                                                                                    |                          | $                            | 17,148 |            | $      | 11,568                      |         | $                   | (27,830 | )                  | $   
|                                                                                                     |                          |                              |        |            |        |                             |         |                     |         |                    |     

21

---

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2002
(in thousands)

|                     |                                                                                     | Sabre
Holdings                                       |   | Sabre Inc. |        | Non-
Guarantor
Subsidiaries |          | Eliminating
Entries |   | Sabre
Consolidated |        
|-------------------- | ----------------------------------------------------------------------------------- | ---------------------------------------------------- | - | ---------- | ------ | --------------------------- | -------- | ------------------- | - | ------------------ | -------
|Operating Activities |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     | Net earnings                                                                        |                                                      | $ | 87,387     |        | $                           | 85,296   |                     | $ | 20,278             |        
|                     | Adjustments to reconcile net earnings to cash
    provided by operating activities: |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     | Depreciation and amortization                                                       |                                                      |   |           |        |                             | 7,625    |                     |   | 21,430             |        
|                     | Deferred income taxes                                                               |                                                      |   |           |        |                             | 69,317   |                     |   | (17,749            | )      
|                     | Tax benefit from exercise of stock options                                          |                                                      |   | 1,919      |        |                             |         |                     |   |                   |        
|                     | Minority interests                                                                  |                                                      |   |           |        |                             |         |                     |   | (847               | )      
|                     | (Income) loss from subsidiaries                                                     |                                                      |   | (85,296    | )      |                             | (20,278  | )                   |   |                   |        
|                     | Gain on sale of former headquarters building                                        |                                                      |   |           |        |                             | (18,308  | )                   |   |                   |        
|                     | Other                                                                               |                                                      |   |           |        |                             | 3,726    |                     |   | 14,331             |        
|                     | Changes in operating assets and liabilities                                         |                                                      |   | (9,401     | )      |                             | (58,625  | )                   |   | (18,488            | )      
|                     |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     |                                                                                     | Cash provided by (used for) operating
    activities |   |            | (5,391 | )                           |          | 68,753              |   |                    | 18,955 
|Investing Activities |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     | Additions to property and equipment                                                 |                                                      |   |           |        |                             | (8,890   | )                   |   | (3,242             | )      
|                     | Purchases of marketable securities                                                  |                                                      |   |           |        |                             | (540,795 | )                   |   | (119,555           | )      
|                     | Sales of marketable securities                                                      |                                                      |   |           |        |                             | 368,896  |                     |   | 139,463            |        
|                     | Investments in subsidiaries, net                                                    |                                                      |   | (4,468     | )      |                             |         |                     |   |                   |        
|                     | Business combinations, net of cash acquired                                         |                                                      |   |           |        |                             |         |                     |   | (35,907            | )      
|                     | Proceeds from sale of former headquarters
    building                              |                                                      |   |           |        |                             | 80,000   |                     |   |                   |        
|                     | Proceeds from sale of minority interest in
    Sabre Pacific                        |                                                      |   |           |        |                             |         |                     |   | 23,466             |        
|                     | Other investing activities, net                                                     |                                                      |   |           |        |                             | 30,283   |                     |   | (6,958             | )      
|                     |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     |                                                                                     | Cash provided by (used for) investing
    activities |   |            | (4,468 | )                           |          | (70,506             | ) |                    | (2,733 
|Financing Activities |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     | Contributions from affiliates                                                       |                                                      |   |           |        |                             | 4,468    |                     |   |                   |        
|                     | Proceeds from issuance of common stock                                              |                                                      |   | 6,915      |        |                             |         |                     |   |                   |        
|                     | Other financing activities, net                                                     |                                                      |   |           |        |                             |         |                     |   | (14,529            | )      
|                     |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     |                                                                                     | Cash provided by (used for) financing
    activities |   |            | 6,915  |                             |          | 4,468               |   |                    | (14,529
|                     | Increase (decrease) in cash                                                         |                                                      |   | (2,944     | )      |                             | 2,715    |                     |   | 1,693              |        
|                     | Cash at beginning of the period                                                     |                                                      |   |           |        |                             | 8,642    |                     |   | 10,213             |        
|                     |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        
|                     | Cash at end of the period                                                           |                                                      | $ | (2,944     | )      | $                           | 11,357   |                     | $ | 11,906             |        
|                     |                                                                                     |                                                      |   |            |        |                             |          |                     |   |                    |        

22

---

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2001
(in thousands)

|                     |                                                                                         | Sabre
Holdings                                       |   | Sabre Inc. |         | Non-
Guarantor
Subsidiaries |          | Eliminating
Entries |   | Sabre
Consolidated |        
|-------------------- | --------------------------------------------------------------------------------------- | ---------------------------------------------------- | - | ---------- | ------- | --------------------------- | -------- | ------------------- | - | ------------------ | -------
|Operating Activities |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     | Net earnings                                                                            |                                                      | $ | 17,148     |         | $                           | 11,568   |                     | $ | (27,830            | )      
|                     | Adjustments to reconcile net earnings
    to cash provided by operating
    activities: |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     | Depreciation and amortization                                                           |                                                      |   |           |         |                             | 55,798   |                     |   | 82,557             |        
|                     | Deferred income taxes                                                                   |                                                      |   |           |         |                             | 9,409    |                     |   | (9,341             | )      
|                     | Minority interests                                                                      |                                                      |   |           |         |                             |         |                     |   | (7,787             | )      
|                     | Tax benefit from exercise of stock
    options                                          |                                                      |   | 6,402      |         |                             |         |                     |   |                   |        
|                     | (Income) loss from subsidiaries                                                         |                                                      |   | (11,568    | )       |                             | 27,830   |                     |   |                   |        
|                     | Cumulative effect of accounting
    change, net                                         |                                                      |   |           |         |                             |         |                     |   | (3,103             | )      
|                     | Other                                                                                   |                                                      |   |           |         |                             | 468      |                     |   | (442               | )      
|                     | Changes in operating assets and
    liabilities                                         |                                                      |   | 50,834     |         |                             | (132,499 | )                   |   | 17,938             |        
|                     |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     |                                                                                         | Cash provided by (used for)
    operating activities |   |            | 62,816  |                             |          | (27,426             | ) |                    | 51,992 
|Investing Activities |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     | Additions to property and equipment                                                     |                                                      |   |           |         |                             | (43,954  | )                   |   | (7,455             | )      
|                     | Purchases of marketable securities                                                      |                                                      |   |           |         |                             | (372,125 | )                   |   | (83,747            | )      
|                     | Sales of marketable securities                                                          |                                                      |   |           |         |                             | 345,582  |                     |   | 79,771             |        
|                     | Investments in subsidiaries, net                                                        |                                                      |   | (94,996    | )       |                             | (3,392   | )                   |   |                   |        
|                     | Business combinations, net of cash
    acquired                                         |                                                      |   |           |         |                             |         |                     |   | (25,000            | )      
|                     | Other investing activities, net                                                         |                                                      |   |           |         |                             | 504      |                     |   | (8,359             | )      
|                     |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     |                                                                                         | Cash provided by (used for)
    investing activities |   |            | (94,996 | )                           |          | (73,385             | ) |                    | (44,790
|Financing Activities |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     | Contributions from affiliates                                                           |                                                      |   |           |         |                             | 94,996   |                     |   | 3,392              |        
|                     | Proceeds from issuance of common
    stock                                              |                                                      |   | 32,180     |         |                             |         |                     |   |                   |        
|                     |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     |                                                                                         | Cash provided by (used for)
    financing activities |   |            | 32,180  |                             |          | 94,996              |   |                    | 3,392  
|                     | Increase (decrease) in cash                                                             |                                                      |   |           |         |                             | (5,815   | )                   |   | 10,594             |        
|                     | Cash at beginning of the period                                                         |                                                      |   |           |         |                             | 1,582    |                     |   | 6,196              |        
|                     |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        
|                     | Cash at end of the period                                                               |                                                      | $ |           |         | $                           | (4,233   | )                   | $ | 16,790             |        
|                     |                                                                                         |                                                      |   |            |         |                             |          |                     |   |                    |        

23

---



Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

SABRE HOLDINGS CORPORATION

RESULTS OF OPERATIONS



Three Months Ended March 31, 2002 and 2001



24

---



25

---



SABRE HOLDINGS CORPORATION
LIQUIDITY AND CAPITAL RESOURCES



26

---



27

---



OUTLOOK FOR THE REMAINDER OF 2002



28

---

SABRE HOLDINGS CORPORATION
CAUTIONARY STATEMENT



Risk Factors



WE
FACE COMPETITION FROM ESTABLISHED AND EMERGING TRAVEL DISTRIBUTION CHANNELS. MANY OF OUR COMPETITORS IN THE TRAVEL MARKETING AND DISTRIBUTION BUSINESS ARE WELL FUNDED AND HAVE MAJOR TRAVEL
SUPPLIERS AS SIGNIFICANT SHAREHOLDERS.



29

---

DECREASED
SUPPLIER COMMISSIONS COULD ADVERSELY AFFECT US



INDUSTRY
CONSOLIDATION AND INCREASED COMPETITION FOR TRAVEL AGENCY SUBSCRIBERS MAY RESULT IN INCREASED EXPENSES, REDUCED REVENUE AND MARKET POSITION, AND GREATER FINANCIAL LEVERAGE.



AIRLINES
THAT ARE DIVESTING THEIR OWNERSHIP OF GLOBAL DISTRIBUTION SYSTEMS MIGHT LIMIT THEIR PARTICIPATION IN OUR TRAVEL MARKETING AND DISTRIBUTION SERVICES.



REGULATORY
DEVELOPMENTS COULD LIMIT OUR ABILITY TO COMPETE.



30

---

RAPID
TECHNOLOGICAL CHANGES AND NEW DISTRIBUTION CHANNELS MAY RENDER OUR TECHNOLOGY OBSOLETE OR DECREASE THE ATTRACTIVENESS OF OUR SERVICES TO CUSTOMERS.



OUR
SYSTEMS MAY SUFFER FAILURES, CAPACITY CONSTRAINTS AND BUSINESS INTERRUPTIONS, WHICH COULD INCREASE OUR OPERATING COSTS AND CAUSE US TO LOSE CUSTOMERS.



OUR
REVENUES ARE HIGHLY DEPENDENT ON THE TRAVEL AND TRANSPORTATION INDUSTRIES, AND PARTICULARLY ON THE AIRLINES, AND A PROLONGED SUBSTANTIAL DECREASE IN TRAVEL BOOKINGS VOLUMES COULD ADVERSELY AFFECT
US.



31

---

WE
FACE TRADE BARRIERS OUTSIDE OF NORTH AMERICA THAT LIMIT OUR ABILITY TO COMPETE.



OUR
INTERNATIONAL OPERATIONS ARE SUBJECT TO OTHER RISKS WHICH MAY IMPEDE OUR ABILITY TO GROW INTERNATIONALLY.



WE
MAY NOT SUCCESSFULLY MAKE AND INTEGRATE BUSINESS COMBINATIONS AND STRATEGIC ALLIANCES.



32

---



PART II: OTHER INFORMATION

Item 1. Legal Proceedings

Worldspan Dispute



India Tax Issue



Northwest Dispute



Travelocity.com Shareholder Litigation



33

---



Item 6. Exhibits and Reports on Form 8-K

The
following exhibits are included herein:

|Exhibit Number |  | Description of Exhibit                                                                      
|-------------- |  | --------------------------------------------------------------------------------------------
|3.1            |  | Restated Certificate of Incorporation of Sabre Holdings Corporation.(1)                     
|3.2            |  | Restated Bylaws of Sabre Holdings Corporation.(2)                                           
|12.1           |  | Computation of ratio of earnings to fixed charges for the three months ended March 31, 2002.

---



34

---



Signature

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.

|                   |  | SABRE HOLDINGS CORPORATION
|------------------ |  | --------------------------
|Date: May 15, 2002 |  | By:                       

35

---