CHICAGO, Feb. 16, 2011 /PRNewswire via COMTEX/ --
Orbitz Worldwide, Inc. (NYSE: OWW) today announced results for the fourth quarter and year ended December 31, 2010.
"2010 was a successful year in which we delivered $11.4 billion in gross bookings, 6% growth in Adjusted EBITDA, and acceleration in room night growth to 8%. We were particularly pleased with the performance of our ebookers business in Europe and our U.S. distribution business, both of which grew room nights by 50% or more," said Barney Harford, CEO of Orbitz Worldwide."In 2011 we are focused on strategic initiatives around hotel distribution including enhancing the hotel search and booking experience; expanding our mobile offerings; augmenting our ability to source a broad and deep range of highly competitive inventory from suppliers around the world; and completing the migration of our consumer businesses to the global platform."
Fourth Quarter 2010 Financial Highlights
The company reported a net loss of $78.0 million or $(0.76) per diluted share for the fourth quarter 2010 compared with a net loss of $18.1 million or $(0.21) per diluted share for the fourth quarter 2009. The net loss for the fourth quarter 2010 was due primarily to non-cash goodwill and intangible asset impairment charges. Adjusted EBITDA was $26.3 million for the fourth quarter 2010, a decrease of 5 percent year over year.
Gross Bookings and Net Revenue
Global gross bookings increased 4 percent year over year on both a reported and constant currency basis. This increase was due primarily to higher volume for the company's ebookers and Orbitz for Business brands and higher air fares and average daily rates ("ADRs") for hotel rooms. Lower air and vacation package volume for the company's domestic leisure brands and lower hotel volume for HotelClub partially offset this increase.
Net revenue was $182.4 million for the fourth quarter 2010, an increase of 4 percent year over year on both a reported and constant currency basis. Net revenue was up primarily due to an increase in standalone hotel volume and ADRs, higher air volume for ebookers and a non-cash reduction in the unfavorable contract liability due to the termination of the Charter Associate Agreement with American Airlines effective December 2010. The reduction in this liability was recorded as an increase to net revenue. These increases were partially offset by lower advertising revenue and a decline in revenue from the company's airline hosting business.
At December 31, 2010, cash and cash equivalents were $97.2 million compared with cash and cash equivalents of $46.4 million at December 31, 2009 (net of $42.2 million of borrowings under the revolving credit facility). The year over year increase in cash was driven in part by the $50.0 million of cash proceeds received from the additional equity investment made by Travelport in January 2010.
Operational Highlights
• In November 2010, Roger Liew was named Chief Technology Officer. Previously, Roger was Vice President of Technology at Orbitz Worldwide and Group Manager of the Intelligent Marketplace Group.
• In November 2010, Orbitz launched the first native applications for the iPhone(R) and Android(TM) mobile devices that allow consumers to shop and book air travel, hotel and car rental options. The company also launched a next generation mobile website (m.orbitz.com) that enables consumers to access Orbitz from any Web-enabled mobile phone. The Orbitz applications for iPhone(R) and Android(TM), as well as the next generation of the Orbitz mobile website, now allow travelers to make reservations quickly, access itineraries anytime, anywhere and check flight status, gate and baggage claim details.
• During the fourth quarter, Orbitz Worldwide signed a two-year global hotel agreement with Wyndham Worldwide, including 6,200 participating hotels.Orbitz Worldwide also signed agreements with a number of regional hotel partners, including Southern Sun, Doyle Collection, Vacances Bleues, Simply Hotels, Pestana Hotels & Resorts and Austria Trend Hotels. In addition, Orbitz signed an agreement with Accor to offer their Ibis brand in select countries.
• In December 2010, Orbitz launched its annual Winter Hotel Sale, offering travelers up to 50 percent off of thousands of hotels worldwide.
• During the fourth quarter, Orbitz Worldwide signed global contracts with destination marketing organizations, including Tourism Australia, Puerto Rico Tourism Company, Hawaii Tourism Authority and Canadian Tourism Commission. Orbitz Worldwide now has partner marketing agreements with nearly 200 destination marketing organizations.
• In December 2010, the company launched a customized private label solution for Ultimate Fighting Championship, enabling their customers to book hotels, air travel, car rentals and vacation packages using the Orbitz Worldwide global network of suppliers.
• In December 2010, ebookers launched its mobile website (m.ebookers.com), which allows consumers to shop and book air travel, hotel and car rental options directly from any web-enabled mobile device - in all languages and currencies supported by ebookers.The ebookers mobile website is built upon the global technology platform and allows customers to access their itineraries anytime, anywhere and enables access to rich content for hotels such as detailed descriptions, reviews, maps and photos. ebookers was the first online travel agent in Europe to offer a fully bookable mobile service for multiple products.
• In January 2011, ebookers launched a new advertising campaign across all of its 12 country websites which reinforces its "Book easier, travel happier" value proposition. ebookers also sponsored a prime time television program beginning in January 2011 to further drive brand awareness for consumer audiences with a passion for travel.
• In January 2011, Orbitz launched its Winter Savecations Hotel Sale, offering travelers 30 percent or more off of thousands of hotels worldwide.
• Russ Hammer was appointed Chief Financial Officer effective January 1, 2011. Previously, Russ was Chief Financial Officer at Crocs, Inc.
• In February 2011, the company signed a long-term renewal agreement with ITA Software, Inc. ("ITA"), a leading provider of innovative solutions to the travel industry. The agreement includes terms for the company's use of ITA's QPX software for the Orbitz.com and CheapTickets.com websites through December 31, 2015.
Outlook
For the first quarter 2011, the company expects:
• Net revenue in the range of $177 million to $184 million; and
• Adjusted EBITDA between $16 million and $21 million.
