Orbitz Worldwide, Inc. Reports First Quarter 2013 Results
Orbitz Worldwide, Inc. (NYSE: OWW) today announced results for the first quarter ended March 31,2013.
Chicago, May 9, 2013 - Orbitz Worldwide, Inc. (NYSE: OWW) today announced results for the first quarter ended March 31,2013.
• Room nights grew 14 percent in the first quarter 2013, a 7 percentage point acceleration from fourth quarter 2012.
• Revenue increased 7 percent to $202.9 million in the first quarter 2013
• Revenue from hotels and vacation packages grew to represent 47 percent of total revenue for the trailing twelve months (TTM) ended March 31, 2013, up 288 basis points from the TTM ended March 31, 2012.
• Net income was $146.2 million for the first quarter 2013 due to the release of a $157.5 million valuation allowance related to the company's U.S. federal deferred tax assets.
• Adjusted EBITDA grew 5 percent in the first quarter 2013 to $21.6 million.
First Quarter 2013 Financial Results
Gross Bookings and Net Revenue
Gross bookings declined one percent year over year in the first quarter 2013. This decline was primarily driven by lower air volume, partially offset by higher hotel, vacation package and car rental volumes, higher average booking values for hotels, higher air fares and an air supplier mix shift.
Net revenue was $202.9 million for the first quarter 2013, up seven percent year over year. This increase was primarily driven by higher hotel volume and higher net revenue per air, hotel and vacation package transaction. Net revenue in the first quarter 2013 also benefited from the addition of an airline servicing revenue stream for one of the company's private label distribution partners and higher advertising revenue. Lower air volume partially offset these increases.
• Standalone air net revenue was $69.3 million in the first quarter 2013, down four percent year over year. This decrease was driven primarily by lower volume, partially offset by higher net revenue per airline ticket and the addition of an airline servicing revenue stream.
• Standalone hotel net revenue was $62.9 million in the first quarter 2013, up 27 percent year over year. This increase was driven primarily by higher volume and higher net revenue per transaction.
• Vacation package net revenue increased five percent in the quarter to $31.7 million due primarily to higher net revenue per package and higher volume.
• Advertising and media revenue was $13.1 million in the first quarter 2013, up 14 percent year over year.
• In February 2013, Orbitz launched the Orbitz Flights, Hotels, Cars app for iPad, an extension of its top-rated mobile apps. The Orbitz app for iPad is the only fully native, in-app experience that allows consumers to search and book all three major components of a trip. Designed specifically for the iPad, the new app brings the same speed, ease of use and exclusive mobile-only discounts to consumers as the award-winning Orbitz iPhone app -- a 2012 inductee into the App Store Hall of Fame and the only travel booking app given the App Store's Editors' Choice designation.
• In April 2013, ebookers launched the ebookers Flights, Hotels, Car Hire app for iPhone and iPad, the first in Europe to have search and book functionality for the three main components of travel: hotels, flights and car hire.
• In March 2013, ebookers launched a rail product offering, becoming the first European OTA to offer rail tickets across the entire UK rail network. ebookers customers can now book UK rail quickly and seamlessly across 21 different rail operating companies, with access to over 2,500 train stations and 20,000 trains per day.
• In March 2013, Orbitz won the Gold Award in the Retail & E-Tail category at the 2013 Advertising Research Foundation's(ARF) David Ogilvy Awards for its "Take Vacation Back" brand campaign that launched last May. The annual awards cover 12 categories and recognize the extraordinary use of research in the advertising development processes by brands, research firms and advertising agencies. Orbitz took home top prize in the category over eHarmony for multiple factors including how well research was used in development of the ad and how research was used to measure results.
• During the first quarter 2013, Orbitz Worldwide signed a multi-year agreement with Starwood Hotels & Resorts and partnership agreements with a number of regional hotel groups including Kross Hotels in Spain, Rede Atlantico in Brazil and Bespoke Hotels in the UK, among others.
• During the first quarter 2013, Orbitz Worldwide signed distribution agreements with a number of airlines including LOT Polish Airlines, Kenya Airways, Air Berlin, Finnair, Air Astana and Transaero Airlines.
• The company signed a multi-year distribution agreement with Hertz Rent a Car in the first quarter 2013.
• During the first quarter 2013, Orbitz Worldwide signed partner marketing contracts with a number of destination marketing organizations including Bahamas Tourist Office, Barbados Tourism Authority, Brand USA, Mexico Tourism Board, Mount Hood Tourism, Okaloosa Tourism, Omaha Convention & Visitors Bureau, Positively Cleveland, Tourism Ireland, Travel Portland, Utah Office of Tourism, Vermont Tourism, Visit Annapolis, Visit Denmark and Visit Norway.
• In March 2013, Orbitz Worldwide and the Vermont Department of Tourism launched a five-part online video series, "Orbitz Originals: Winter in Vermont," hosted by award-winning travel expert Richard Bangs and available at Orbitz.com/Vermont. Building on the success of previous "Orbitz Originals" installments that highlighted destinations as diverse as Ireland, New York and the Cayman Islands, this new series harnesses the power of online video to showcase Vermont's winter attractions and will be followed by "Orbitz Originals: Summer in Vermont" later this year.
For the second quarter 2013, the company expects:
• Net revenue in the range of $214 million to $220 million; and
• Adjusted EBITDA between $35 million and $39 million.
For the full year 2013, the company expects:
• Net revenue growth in the range of four percent to seven percent; and
• Adjusted EBITDA growth between five percent and ten percent.
This outlook assumes foreign exchange rates as of April 30, 2013.