PRICELINE BABY!!!!!!!!!!!!!!!!!!!!!
priceline.com (PCLN) 8.81 +0.38: -- Update -- Reports Q2 earnings of $0.05 (company highlights
$0.06, but that's basic instead of diluted EPS), $0.04 betterthan the First Call consensus; revenues were
$364.8 mln vs the $301 mln consensus. Company guides higher for Q3' expects revenues to exceed
year-ago of $341 mln with pro forma EPS of $0.05-0.07 vs consensus estimates of $322 mln and $0.03.
Priceline.com Reports Profitability and Record Revenue For 2nd Quarter 2001
Business Wire - Tuesday, July 31, 2001
NORWALK, Conn.--(BUSINESS WIRE)--July 31, 2001--Priceline.com (Nasdaq: PCLN)
-- Revenues are $364.8 million
-- Pro forma net income is $11.7 million, or $0.06 per basic share
-- Pro forma EBITDA is $13.9 million o Cash balance increases to $165.7 million
Priceline.com (Nasdaq: PCLN) today reported record revenues and its first profit for the 2nd quarter 2001.
Revenues for the 2nd quarter 2001 were $364.8 million, compared to revenues of $352.1 million in the 2nd
quarter 2000 and $269.7 million in the 1st quarter 2001. Priceline.com reported pro forma EBITDA for the 2nd quarter 2001 of $13.9 million and pro forma net income of $11.7 million, or $0.06 per basic share, which beat analysts' First Call consensus estimates of $0.01 per basic share. On a diluted basis, pro format net income was $0.05 per share. Pro forma EBITDA and pro forma net income exclude certain severance expenses, option payroll taxes and amortization of stock-based compensation charges.
Priceline.com reported GAAP net income for the 2nd quarter 2001 of $2.8 million, or $0.01 per basic and
diluted share, compared to a GAAP net loss in the 2nd quarter 2000 of $11.7 million, or $0.07 per basic and diluted share, and a GAAP net loss of $13.8 million, or $0.07 per basic and diluted share in the 1st quarter 2001.
Priceline.com's gross profit for the 2nd quarter 2001 also was a record $60.1 million, compared to a gross
profit of $54.8 million in the 2nd quarter 2000 and $43.1 million in the 1st quarter 2001. Priceline.com's 2nd quarter gross margin was 16.5%.
Priceline.com continued to reduce expenses and strengthen its balance sheet during the 2nd quarter 2001.
Pro forma operating expenses for the 2nd quarter 2001 decreased to $50.2 million from $51.1 million in the
1st quarter 2001 and $62 million in the 4th quarter 2000 when the company began its cost reduction
activities, and was down approximately 16% from the same quarter a year ago. Pro forma operating
expenses exclude certain severance expenses, option payroll taxes, amortization of stock-based
compensation charges, and restructuring charges, special charges and warrant charges.
The Company's cash balance at the end of the 2nd quarter 2001 increased to $165.7 million, compared to
$138.7 million at the end of the 2nd quarter 2000 and $142.6 million at March 31, 2001, driven primarily by the generation of $13.9 million pro forma EBITDA and related changes in working capital. The Company's outstanding preferred stock was also reduced from $80 million at the beginning of the quarter to
approximately $55.0 million at the end of the quarter, and subsequently to approximately $25.0 million as of July 27, 2001, when Delta Air Lines exercised 10 million additional warrants.
During the 2nd quarter 2001, priceline.com saw significant growth in its customer metrics. The Company
added 1.025 million new customers in the 2nd quarter 2001, bringing its total customer base to 10.9 million. Repeat business for the 2nd quarter 2001 (defined as the number of unique purchase offers coming from repeat customers divided by the number of total unique purchase offers) was a record 61%, compared to 39% in the 2nd quarter 2000, and 58% in the 1st quarter 2001.
During the quarter, priceline.com sold a record 3 million units of travel products. Priceline.com sold 1.4
million airline tickets in the 2nd quarter, an increase of 11% over 2nd quarter 2000 and 34% over 1st quarter 2001. Priceline.com's hotel and rental car products experienced even stronger quarterly unit sales growth. Hotel room nights sold increased 57% over both the 2nd quarter 2000 and the 1st quarter 2001. Rental car days sold increased 115% and 52% over the same periods.
"We are pleased that our airline ticket sales have substantially recovered, despite the difficult airline travel
market and competition from heavy discounting by the major carriers," said Jeffery H. Boyd, priceline.com's President and Chief Operating Officer. "It is also encouraging to see the continued rapid growth of our hotel and rental car products, which we believe have a substantial inventory advantage over the competition and broad consumer appeal."
Mr. Boyd added, "The hard work of priceline.com's employees in improving our products and service while
making priceline.com more efficient has paid off with a recovery in top line growth and priceline.com's first profitable quarter."
Significant 2nd quarter 2001 developments for priceline.com included:
-- The successful further leveraging of priceline.com's growing
customer base through database marketing. During the 2nd
quarter, priceline.com continued to refine e-mail and other
strategies to reach out to customers and generate additional
purchase offers, resulting in a record 61% repeat business for
the quarter.
-- A phase-two rollout of priceline.com's successful TV and radio
advertising campaign. The Company created and launched the
second in a series of innovative "Let's Jet-Set" TV
commercials combining illustrations and actors promoting
priceline.com's unique money saving consumer proposition.
Priceline.com's current "Orlando" spot features the voice of
Quentin Tarantino, while future spots will feature the voices
of Tony Randall and Billy Idol. Meanwhile, priceline.com's new
radio campaign, which also began in the 2nd quarter, features
longtime priceline.com celebrity spokesman William Shatner.
The new campaigns have yielded a significant strengthening of
priceline.com's brand along several key attributes, including
best deal and smarter way to buy.
-- Further expansion of priceline.com's travel products. In May,
priceline.com launched a new resort service that enables
travelers to set their own price for stays at top resorts in
the mainland U.S., Hawaii, Puerto Rico and the U.S. Virgin
Islands. Also during the quarter, priceline.com enhanced its
last-minute service by enabling travelers to book airline
flights up until 11:00 p.m. (EST) the day before departure. In
particular, the change makes it more convenient for
priceline.com's West Coast customers to book next-day flights.
Priceline.com's last-minute service also allows customers to
book hotel rooms up until 6:00 p.m. for use that night, and
allows customers to rent cars on as little as four hours
advance notice.
-- The broadening of priceline.com's strategic relationship with
Cheung Kong (Holdings) Limited and Hutchison-Whampoa Limited.
In June, the two companies purchased approximately $110
million worth of priceline.com common stock, giving them an
equity stake of approximately 30% in priceline.com. Hutchison
is also a majority investor in Hutchison-Priceline Limited, a
company formed to introduce priceline.com's business model to
markets in Asia. Hutchison is a multi-national conglomerate
with a market capitalization of approximately $46 billion.
Hutchison operates five core businesses in 34 countries,
including telecommunications and e-commerce, property and
hotels, retail and manufacturing, energy and infrastructure,
and ports and related services.
Richard S. Braddock, priceline.com's Chairman and Chief Executive Officer, stated, "We expect
priceline.com to continue the steady growth of customers extending beyond our current 11 million
customers," he said. "That customer base has the potential to yield even more incremental growth as we
develop even more efficient database marketing tools and continue to build on our repeat business ratio."
Looking forward, Mr. Braddock said, "Online travel appears to be one of the few sweet spots in e-commerce. Based on 2nd quarter results and our performance in July, we are increasing the guidance we previously gave for 3rd quarter 2001 and now expect revenues to exceed 3rd quarter 2000 revenues of $341 million. We also would expect pro forma net income to range from $0.05 to $0.07 per basic share. With our renewed brand strengths, our product offerings robust and expanding, our customer base growing on both new and repeat bases, and our margins well above industry averages and sustainable, we believe priceline.com is now positioned to be one of the Internet's pre-eminent, profitable e-commerce brands." |
