* Adjusted profit of $8.85 compares with analyst estimate of
* Booking.com advertising pays off in U.S., CEO says
Feb 20 Priceline.com, the online travel
agency known for its name-your-own-price auctions, posted a
higher-than-expected quarterly profit on Thursday, boosting
shares in extended trading.
Darren Huston, the former chief of Booking.com who became
chief executive officer and president of Priceline.com in
January, said bookings for hotel stays, airline tickets and
rental cars picked up at the end of the quarter for the start of
2014. He added that advertising for Booking.com was paying off
in the United States.
"There was broad-based strength throughout the world but the
U.S. in particular was a very healthy market," Huston said in an
He said the Priceline brand performed well, aided by airline
ticket sales and rental car reservations.
Priceline, which owns Kayak.com and Agoda.com, is boosting
its presence in fast-growing markets such as Asia. The
acquisition of Kayak, which compiles airline and hotel prices
from other travel websites, gave Priceline more exposure.
"Priceline continues to take market share or just gain
penetration across all of its geographies," said Daniel Kurnos,
an analyst with Benchmark Company.
Fourth-quarter net income came to $378 million, or $7.14 a
diluted share, compared with $289 million, or $5.63 a share, a
Adjusted for items, profit came to $8.85 a share, compared
with $8.29 a share expected by analysts on average, according to
Thomson Reuters I/B/E/S.
Gross bookings, or the total dollar value of travel services
purchases, came to $9.1 billion, up about 39 percent from the
year earlier. International bookings rose 41 percent while U.S.
bookings gained nearly 27 percent.
Quarterly revenue rose about 29 percent to $1.54 billion.
The results from Priceline followed stronger-than-expected
results from rivals Expedia Inc and Orbitz Worldwide
Inc in recent weeks.
"Online travel within travel is very strong, and within
online travel, people are turning to online travel agencies even
more," Huston said. "It's a combination of those things that I
think have led to a pretty healthy environment for all the
players in this space."
Priceline forecast profit of $6.35 to $6.85 a share for the
first quarter. Analysts expected $7.19.
Company officials said in a conference call that the fact
that the Easter holiday falls in April this year, compared to
March last year, could put pressure on margins. That could mean
some bookings for Easter week, a popular vacation time, would
not apply to revenue for the first quarter that ends March 31.
Shares of Priceline were up about 1.4 percent to $1,300.99
in extended trading after the results were posted Thursday. They
have risen 10 percent this year, compared with 14 percent for
Expedia and 27 percent for Orbitz.