Expedia Inc (EXPE.O) on Wednesday forecast a rise in 2016 earnings in part from recent acquisitions, pushing shares up even though the company warned that the Nov. 13 Paris attacks hurt travel demand and its fourth-quarter profit fell below analysts' estimates.
Expedia, the world's largest online travel services company by bookings, said it expects a 35 percent to 45 percent boost in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for 2016, when excluding a business the company recently sold, eLong.
Shares rose more than 12 percent after the news in extended trading.
Expedia lost $13 million in the fourth quarter in part from closing its purchase of vacation rental site HomeAway Inc for $3.9 billion, a move that could ramp up competition with apartment-sharing startup Airbnb.
Last year marked a deal-making spree for Expedia in which it also bought Orbitz Worldwide Inc for $1.3 billion and Travelocity for $280 million.
In an interview, Chief Financial Officer Mark Okerstrom said Expedia is interested in growing its business travel arm, Egencia, potentially through minority stakes in other companies.
"Our M&A team is always open for business," he said.
On an adjusted basis, Expedia's income fell nearly 6 percent to $107 million, or 77 cents per share, compared to the average analyst estimate of $139 million, or $1.00 per share, according to Thomson Reuters I/B/E/S.
S&P Capital IQ analyst Tuna Amobi said the recent acquisitions appear a boost to the company so far, although he warned that ongoing investments could pressure its profit margins.
Expedia said the Paris attacks, in which Islamic State militants killed 130 people, lowered by $10 million to $15 million the company's adjusted EBITDA for 2015, excluding eLong. The measure grew 11 percent in the year.
"Volumes into Paris have still not completely come back," Okerstrom said, noting cancellations and reduced bookings to London and New York as well. "It is growing, but... we don’t know if that will have a financial impact on us for the (first) quarter."
The value of bookings on Expedia sites was $14.95 billion in the fourth quarter, a 40 percent rise from a year ago when excluding eLong.
(Reporting By Jeffrey Dastin in New York; Editing by Chris Reese)