Feb 20 2014, 5:23pm CST | by Forbes
Consumers’ wanderlust is benefiting the Priceline Group: the company, which owns travel booking sites Booking.com, priceline.com, Kayak.com, rentalcars.com and agoda.com, reported fourth quarter 2013 earnings results Thursday afternoon that were well above Street expectations on both profit and revenue thanks largely to a near-40% increase in bookings for the quarter.
Priceline reported fourth quarter revenue of $1.54 billion, up from the $1.19 billion reported for the same quarter in 2012 and beating Street estimates of $1.52 billion. Fourth quarter net income came in at $471 million, a 35.2% increase compared to the prior-year period and resulting in profit of $8.85 per share, up significantly from the $6.77 reported in 2012 and beating the analyst consensus of $8.31 by 54 cents. Bookings for the quarter increased 38.8% to $9.1 billion and were particularly helped by the company’s international operations, which saw bookings increase 41.9% to $1.3 billion.
These results bring Priceline’s full-year revenue to $6.8 billion, up from $5.3 billion in 2012. Full-year net income was $2.2 billion, a 36.3% increase over 2012 and resulting in earnings of $41.72 per diluted share, up from $31.28 per share in 2012. On a full year basis, gross travel bookings brought in $39.2 billion, a 37.7% increase compared to 2012.
“The Priceline Group finished 2013 with a strong 4th quarter, reporting accelerating hotel, rental car and airline ticket unit growth,” Darren Huston, Priceline president and CEO, said in a statement Thursday afternoon. “The Group’s full year room night reservations of 271 million grew by 37%, as compared to 40% in 2012, reflecting only modest deceleration on a large scale business.”
Looking ahead to 2014, Priceline provided first quarter 2014 guidance that was likely disappointing to many investors, but Priceline executives attributed the conservative outlook to Easter’s later date this year — April 20, 2014 — which means that any bookings that close for Easter weekend will count towards the second quarter of 2014, not the first. (For comparison, Easter fell on March 31 in 2013.) Priceline said it expects first quarter travel bookings to increase between 23% and 33%, with first quarter net income per share coming somewhere between $6.35 and $6.85. Analysts, meanwhile, expect first quarter earnings of $7.27 per share.
Following news of the earnings beat, shares of Priceline initially jumped 2% in after-hours trading, and then yoyoed up and down by a percentage point or less as investors processed the lower-than-expected first quarter outlook. Shares of the travel booking company are currently up 1.8%; year-over-year, the stock has seen 85% growth.
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Source: Forbes Business
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