Budget Group Reports First Quarter Results
DAYTONA BEACH, Fla., April 21 /PRNewswire/ -- Budget Group, Inc.
(NYSE: BD) released its first quarter operating results today, reporting a
loss per share of 64 cents compared to a loss per share of 12 cents in first
quarter 1998. Net loss for the first quarter was $23.0 million versus a loss
of $3.4 million in the prior year. Revenue increased 48.8% to $678.7 million
from $456.0 million in the prior year first quarter. Operating income for the
quarter was $11.3 million compared to $34.2 million in the prior year. Prior
year first quarter excludes Ryder TRS and other acquisitions of Budget
licensees, insurance replacement businesses and new car dealerships.
Revenue for the quarter for the Car Rental segment increased 14.4% to
$387.6 million compared to $338.8 million in 1998. Car Rental operating
income was $24.2 million compared to $36.2 million in the prior year first
quarter. First quarter 1999 operating income showed an approximate $22
million improvement over fourth quarter 1998. Budget Rent a Car North
America, which represents 75% of this segment, saw revenue growth of 9.0%
versus prior year first quarter (up 5.3% on a same-market basis). On a
same-market basis, DDA at $39.29 was essentially flat due to competitive
pricing in certain leisure markets, notwithstanding, rental days were up 6%
for the quarter.
Revenue from Budget International, driven primarily by corporate
operations, saw growth of 36.7%. On a same-store basis, revenue was up 25.5%.
This increase resulted from stepped up worldwide sales and marketing efforts
and the recent acquisition of key Budget licensee operations in France and the
UK. "Last week we received a favorable ruling from the German courts
regarding the termination of Sixt, our former German franchisee. We can now
proceed with developing the German market, which will support our overall
growth strategy for Europe," stated Sandy Miller, Budget Group Chairman and
CEO.
Revenues for the Truck Rental group reached $151.5 million in the first
quarter versus $43.2 million in 1998, which excluded Ryder TRS. Budget Truck
Rental continued to see robust volume growth of 21.0% versus prior year.
Budget truck rental rates increased over 2% as it aligned its pricing with
Ryder. Ryder's revenue was down 6.5% versus prior year pro forma and was in
line with company expectations as the two truck rental businesses are being
integrated. For the quarter, the Truck Rental group had an operating loss of
$3.7 million compared to operating income of $2.5 million in the prior year
first quarter. The year-over-year decline in reported earnings is a result of
the acquisition of Ryder TRS which has seasonal earnings.
Revenue from the Car Sales group reached $160.1 million in the first
quarter compared to $92.0 million in the prior year. Revenue includes
proceeds from the sale of units at retail and wholesale within the group. The
first quarter saw operating losses of $4.5 million compared to a loss of $1.0
million in first quarter 1998. Operating results for first quarter 1999
represent a $2.9 million improvement over fourth quarter 1998, excluding
non-recurring charges. Three unprofitable locations were closed during the
first quarter with an additional two to be closed in April. Units sold retail
increased to 7,957 compared to 4,859 units during the prior year first
quarter.
Commenting on the quarter, Miller noted, "Our first quarter results are in
line with our expectations. Historically, Ryder TRS has experienced losses in
the first quarter due to the seasonality of the truck rental business. We
anticipate that Ryder will show a profit for the balance of the year. I am
very pleased with the overall revenue growth we saw at Budget Rent a Car, up
9% compared with a flat fourth quarter, and particularly with Budget's
same-store revenue growth of 5.3%. Based on the performance of Budget Car
Sales in the first quarter, coupled with the closing of unprofitable stores,
we are confident that we will achieve breakeven in the Car Sales group by
year-end 1999."
Budget Group, Inc. is a global network of vehicle rental and sales
companies operating in three principal segments: Car Rental, Truck Rental and
Car Sales. In Car Rental, Budget Group, through subsidiary companies and
their franchisees, operates Budget Rent a Car Corporation, the world's third
largest car and truck rental system, and Premier Car Rental, the nation's
third largest company serving the insurance replacement market. The company
also operates Van Pool Services, the U.S. leader in commuter van pooling
services, and Budget Airport Parking, a system of airport parking units
located adjacent to Budget Rent a Car facilities in select locations. In
Truck Rental, Budget Group operates Ryder TRS, the nation's second largest
consumer truck rental company; Budget Truck Rental, the third largest consumer
truck rental company; and Cruise America, the largest recreational vehicle
rental and sales company in North America. In Car Sales, Budget Group
operates Budget Car Sales, one of the leading independent retailers of late
model vehicles in the U.S. |
