INTERVIEW-Expedia posts loss, to buy Web travel firms
(Adds CEO interview, details, grafs 2,7,9,10,15-16)
By Michael Fitzpatrick
LOS ANGELES, Jan 31 (Reuters) - Expedia Inc.(NASDAQ: EXPE), the Internet travel affiliate of Microsoft Corp. The acquisitions not only add a wide selection of hotel rooms, vacation homes and inns to Expedia's offerings, they also boost revenues by about 2-1/2 times, Expedia Chief Executive Officer Richard Barton said in an interview.
In its first quarterly results since its initial public offering in November, Bellevue, Wash.-based Expedia said it posted a net loss of $23.2 million, or 64 cents a share, for its second fiscal quarter ended Dec. 31, after non-cash stock-based compensation costs of $17.3 million.
Excluding those costs, Expedia posted a loss of $5.9 million, or 16 cents a share. Analysts on average had expected the company to report a loss of 29 cents a share, according to First Call/Thomson Financial.
Year-ago per-share figures were not available.
Revenues rose to $17.8 million, up 127 percent from $7.9 million a year earlier, said the company, whose Expedia.com site (http://www.expedia.com) provides air, car and hotel booking, vacations and cruise packages.
"I would attribute a majority of (our) growth to us getting much better at converting our really large traffic of shoppers to buyers," Barton told Reuters. "We're getting a whole lot better at getting people to hit that buy button.
Gross travel bookings on Expedia branded Web sites rose to $220 million in the latest quarter, up 158 percent from a year ago. The number of transactions on Expedia sites rose 157 percent to 459,000, and the number of purchasing customers rose 139 percent to 390,000, the company said.
Barton said the acquisitions of online lodging reservation service VacationSpot.com and Internet hotel room consolidator Travelscape.com give Expedia a strong slate of lodging -- from Italian vacation villas to Las Vegas hotel rooms.
"This makes us the center of gravity for Internet lodging on the Web and positions us well to take advantage of this really huge opportunity," Barton said, adding that lodging was a $230 billion-a-year business worldwide.
Expedia will issue about 2.6 million shares and options, worth about $82 million, for VacationSpot.com Inc. Expedia will issue about 3 million shares, options and warrants, worth about $95 million, for Travelscape.com.
The deals come less than a week after Expedia, in which Microsoft holds about an 85 percent interest, said it would launch a new travel magazine with publisher Ziff-Davis Inc.
VacationSpot.com is a reservation network for vacation homes, rental condos, inns and bed & breakfasts. It operates the VacationSpot.com (http://www.vacationspot.com) and Rent-a-Holiday.com (http://www.rent-a-holiday.com) Web sites.
Travelscape.com has discounted rate contracts at more than 1,200 hotels in 240 cities worldwide, and operates the Travelscape.com (http://www.travelscape.com) and LVRS.com (Las Vegas Reservations Systems) (http://www.lvrs.com) Web sites.
The two companies' combined revenues for the latest quarter were about $27 million versus $17.8 million for Expedia, Barton said. He said he expected the companies' growth to keep pace with that of Expedia.
"Growth is very strong at these companies, Barton said. No more deals were imminent for Expedia, which Barton said seeks to "sell everything in travel to everyone, everywhere." |
