NORWALK (dpa-AFX) - Online travel company Priceline.com Inc. (PCLN), Thursday reported a better-than-expected jump in third-quarter profit as more customers used its sites for hotel bookings and other services, and international bookings continued to dominate. Nonetheless, Priceline.com provided a soft outlook for the fourth quarter.
The company also split the roles of chief executive officer and chairman - posts long held by Jeffery Boyd. While Boyd will remain chairman, Darren Huston, a Priceline.com executive, will take over as president and CEO on January 1, 2014.
Priceline.com help users obtain discount rates for travel-related purchases such as airline tickets and hotel stays. Its primary brands include Booking.com, Priceline.com, Agoda.com, rentalcars.com, and Kayak - a travel research site acquired in May for $1.8 billion.
While Priceline.com has been grappling with recessionary trends in Europe and competition from rival Expedia Inc. (EXPE), its overall bookings have been impressive.
Total gross travel bookings in the quarter grew 37.5 percent year-over-year, with international bookings up 41.8 percent, the company said in a statement.
'The Priceline Group finished the summer travel season with strong growth and operating performance,' said CEO Jeffery Boyd. 'Our brands are performing well in a very competitive environment.'
Further, travel reservation services continued to be strong, with room night reservations up 35.6 percent, and rental car days up 27.5 percent. Airline ticket sales climbed 8.6 percent.
Norwalk, Connecticut-based Priceline.com reported third-quarter net income to common stock of $833 million or $15.72 per share, compared with $597 million or $11.66 per share last year.
Excluding items, adjusted earnings for the quarter were $920 million or $17.30 per share, compared with $638 million or $12.40 per share a year ago. On average, 26 analysts polled by Thomson Reuters estimated earnings of $16.15 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the third quarter were $2.27 billion, compared with $1.7 billion in the prior year. Twenty-three analysts had a consensus revenue estimate of $2.22 billion for the quarter.
Total expenses increased to $942 million from $641 million last year, due mainly to online advertising costs.
For the fourth quarter, Priceline.com expect net earnings in the range of $6.40 to $6.90 per share, adjusted earnings of $7.80 to $8.30 per share and and revenue growth of 19 percent to 26 percent. Analysts currently expect earnings of $8.27 per share on revenue growth of 28.10 percent for the quarter.
The company expects total gross travel bookings to climb 27 percent to 34 percent for the quarter.
Meanwhile, elaborating on the CEO change, Priceline.com said that Darren Huston has been a member of its Group Management Board since joining the company in September 2011. Huston had earlier served at Microsoft Corp. as corporate vice president, Consumer & Online.
Huston heads Booking.com B.V. (Netherlands), a unit of Priceline Group, a position he will continue to hold. He also gets a seat on the Priceline.com board.
Meanwhile, Expedia recently reported a lower third-quarter profit, hurt by expenses and income tax provisions, even as earnings trounced Wall Street estimates on a 17 percent climb in revenues.
Priceline.com stock closed Thursday at $1,022.89, down $35.15 or 3.32%, on a volume of about 1.3 million shares. In after hours, the stock gained $12.11 or 1.18%, to trade at $1,035.00. In the last 52-week period, the stock trended in a range of $597.15 - $1,098.70, on an average three-month volume of 0.6 million shares.
Copyright RTT News/dpa-AFX
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