Avis raises revenue forecast on rising demand, higher rentals
July 31 (Reuters) - Car rental company Avis Budget Group raised its full-year revenue and profit forecast as demand rose in North America and the company raised prices.
Shares of Avis, which posted a profit for the second quarter, rose 4 percent to $60.50 after the bell.
The company raised its full-year profit forecast to $2.75-$3.05 per share from $2.50-$2.95 earlier and revenue expectation to $8.6-$8.7 billion from $8.4-$8.6 billion earlier.
Avis, which gets more than two-thirds of its revenue from rentals at airports, expects rental days to rise by 5-7 percent in North America and pricing to increase by about 2 percent this year.
Analysts on average were expecting full-year profit of $2.88 per share on revenue of $8.49 billion, according to Thomson Reuters I/B/E/S.
The car rental industry is tied closely to airline traffic and hotel bookings. Major U.S. airlines reported higher profit in the quarter, driven by increased prices and demand while hotels occupancy rose.
Avis reported a 3 percent rise in time and mileage revenue per day - a key metric that indicates pricing - in North America.
The company reported net profit of $26 million, or 24 cents per share, for the second quarter ended June 30, compared with a loss of $28 million, or 26 cents, a year earlier.
Excluding items, Avis earned 68 cents per share.
Revenue rose 10 percent to $2.19 billion.
Analysts had expected a profit of 61 cents per share on revenue of $2.13 billion. (Reporting by Rohit T. K. in Bangalore; Editing by Sriraj Kalluvila)