Earnings are out.
Preview Travel Reports 35% Growth in Online Revenue For Second Quarter
PR Newswire - July 29, 1998 16:19
Gross Bookings Up 38 Percent Over Prior Quarter to $49.5 Million
SAN FRANCISCO, July 29 /PRNewswire/ -- Preview Travel, Inc. (Nasdaq: PTVL) today announced financial results for the quarter and
six months ended June 30, 1998.
Online travel gross bookings for the second quarter were $49.5 million, up 38 percent from gross bookings of $35.9 million in the first
quarter of 1998, and up 178 percent from the second quarter of the prior year. Revenues from online operations in the second quarter were
$3.1 million, an increase of 35 percent, compared with revenues from online operations of $2.3 million in the first quarter of 1998, and an
increase of 168 percent compared to the second quarter of the prior year.
Total revenues in the second quarter of 1998 were $4.8 million, up 20 percent over revenues of $4.0 million in the prior quarter. Gross
margin in the online business increased to 54.1 percent, compared to 48.5 percent in the first quarter of 1998 and 27.3 percent in the second
quarter of the prior year. Gross profit from online operations in the second quarter was $1.7 million, an increase of 50.4 percent from the
prior quarter, in which gross profit from online operations was $1.1 million, and an increase of 430 percent compared to the second quarter
of 1997. The net loss for the second quarter of 1998 was $5.0 million, or $0.39 per share, on 12,742,000 weighted average shares
outstanding, compared with a net loss of $4.7 million, or $0.41 per share, on 11,353,000 weighted average shares outstanding in the
previous quarter.
"This was an extremely eventful and successful quarter for Preview Travel," said Ken Orton, president and CEO of Preview Travel.
"Significant progress was made in several strategic areas, providing the foundation for continued growth and revenue expansion. In
particular, we signed exclusive distribution agreements with USA Today Online and CNET's Snap! and gained distribution to the Prodigy
Travel Channel via our existing relationship with Excite. We also secured strategic partnerships with American Airlines Vacations and Royal
Caribbean Cruises International to become the first online travel partner to offer real-time booking of their vacation packages and cruises."
The total number of online transactions during the quarter exceeded 160,000, up 43 percent from the 112,000 transactions in the first
quarter. Transactions are defined as single purchases which may consist of multiple airline tickets, hotel bookings, car rentals, vacation
packages and cruises. The average cost per transaction in the second quarter of 1998 was approximately $8.50. The number of airline
transactions which were fulfilled through e-ticketing increased to 44 percent in the second quarter, up from 28 percent in the prior quarter.
The number of registered subscribers on Preview Travel's sites reached 4.4 million, up 30 percent from 3.4 million at the end of the first
quarter of 1998 and up 171 percent from the 1.6 million registered subscribers at the end of the second quarter of 1997. Total traffic to
Preview Travel's sites increased to 22.0 million visits during the quarter, up 16 percent from 18.9 million visits in the first quarter of 1998.
In the second quarter of the prior year, visits to the company's sites were 4.9 million, thus year-over-year growth was 346 percent.
Preview Travel continued to diversify its online revenue sources by increasing revenues from non-air bookings (which, on average,
generate higher commissions than air travel bookings) and also by increasing the percentage of revenue derived from advertising. During
the quarter, non-air and advertising revenues increased to 37 percent of online revenues, as compared to 33 percent in the prior quarter.
Revenues earned from airline tickets represented 63 percent of online revenues in the second quarter, as compared to 67 percent in the
previous quarter.
"Our balance sheet is strong," noted Ken Pelowski, EVP and CFO of Preview Travel. "At the close of the second quarter, our cash and
marketable securities totaled $70.5 million, with working capital at $73.6 million. These improvements were the result of our secondary
offering of common stock, which raised approximately $52 million in the quarter. Our financial resources will allow us to take advantage of
our early entry into the online travel market, and we plan to invest in building market share and brand awareness, as well as adding more
features and services to our sites." |
