Priceline.com Reports Financial Results for 4th Quarter and Full-Year 2009
NORWALK, Conn., Feb. 17 /PRNewswire-FirstCall/ -- Priceline.com Incorporated (Nasdaq: PCLN) today reported its financial results for the 4th quarter and full year 2009. Gross travel bookings for the 4th quarter, which refers to the total dollar value, inclusive of all taxes and fees, of all travel services purchased by consumers, were $2.26 billion, an increase of 52.9% over a year ago.
Priceline.com had revenues in the 4th quarter of $541.8 million, a 33.4% increase over a year ago. The Company’s international operations contributed revenues in the 4th quarter of $222.9 million, a 74.9% increase versus a year ago (approximately 63% on a local currency basis). Priceline.com’s gross profit for the 4th quarter was $313.2 million, a 52.7% increase from the prior year. The Company’s international operations contributed gross profit in the 4th quarter of $222.1 million, a 75.5% increase versus a year ago (approximately 63% growth on a local currency basis). The Company’s operating income in 4th quarter 2009 was $117.9 million, a 141.4% increase from the prior year. Priceline.com had GAAP net income for the 4th quarter of $78.5 million or $1.55 per diluted share, which compares to $34.1 million or $0.75 per diluted share in the same period a year ago.
Pro forma EBITDA for the 4th quarter 2009 was $133.2 million, an increase of 75% over the prior year. Pro forma net income in the 4th quarter was $101.6 million or $1.99 per diluted share, compared to $1.29 per share a year ago. First Call analyst consensus for the 4th quarter 2009 was $1.68 per diluted share. The section below entitled “Non-GAAP Financial Measures” provides a definition and information about the use of pro forma financial measures in this press release and the attached financial and statistical supplement reconciles pro forma financial information with priceline.com’s financial results under GAAP.
For full-year 2009, priceline.com had revenues of $2.34 billion, a 24.1% increase over 2008. Priceline.com’s gross profit for 2009 was $1.26 billion, a 31.9% increase from the prior year. The Company’s 2009 operating income was $470.8 million, a 62.7% increase from the prior year. Priceline.com had GAAP net income for full-year 2009 of $489.5 million or $9.88 per diluted share, which compares to $182.2 million or $3.74 per diluted share in 2008. GAAP net income for 2009 was positively affected by a $183.3 million non-cash tax benefit from reversing a portion of the valuation allowance related to the Company’s net operating loss carry forwards. The valuation allowance was reversed to reflect the amount of deferred tax asset that is estimated to be more likely than not to be realized after taking into consideration current operating results and future estimated taxable income. Pro forma EBITDA for 2009 was $547.7 million, an increase of 45.1% over a year ago. Pro forma net income for 2009 was $425.2 million or $8.52 per diluted share, compared to $5.96 per share a year ago.
“Worldwide gross travel bookings growth accelerated in the 4th quarter due to strong underlying fundamentals, weak results in the prior year period amidst the global recession and improving currency and ADR comparisons,” said priceline.com’s President and Chief Executive Officer Jeffery H. Boyd. “Hotel room nights booked grew 59.9% on a global basis, representing share gains for Booking.com, priceline.com and Agoda.com. Our international business grew gross travel bookings at 81% (69.5% in local currency) as it continued to benefit from geographic expansion, increased hotel supply and consumer shift to online bookings. Domestic gross bookings grew 20.6% in the quarter and the business seems well positioned to compete in an environment where pricing is more stable and where our competition will soon anniversary the conversion benefit of matching priceline.com’s fee cut initiatives.”
Looking forward, Mr. Boyd said, “Throughout 2010, we intend to maintain our focus on building our global hotel platform and strengthening our brands by adding hotel supply, expanding in attractive geographic markets, pursuing integration opportunities and adding content and innovative functionality. The business continues to perform well as economic conditions have stabilized; however, we do expect growth rates to decelerate going forward, particularly in the second half, as we begin to compare against periods of relatively stronger business performance.”
Priceline.com said it was targeting the following for 1st quarter 2010:
- Year-over-year increase in total gross travel bookings of approximately 42% - 48%.
- Year-over-year increase in international gross travel bookings of approximately 65% - 73% (an increase of approximately 56% - 64% on a local currency basis).
- Year-over-year increase in domestic gross travel bookings of approximately 10% - 15%.
- Year-over-year increase in revenue of approximately 23% - 27%.
- Year-over-year increase in gross profit of approximately 50%.
- Pro forma EBITDA of approximately $97 million to $107 million.
- Pro forma net income of between $1.54 and $1.64 per diluted share.
Pro forma guidance for the 1st quarter 2010:
- excludes non-cash amortization expense of acquisition-related intangibles,
- excludes non-cash stock-based compensation expense,
- excludes non-cash interest expense and gains or losses on debt extinguishment, if any, related to cash settled convertible debt,
- excludes non-cash income tax expense and reflects the impact on income taxes of certain of the pro forma adjustments,
- excludes the impact, if any, of charges or benefits associated with judgments, rulings and/or settlements related to hotel occupancy tax proceedings,
- includes the anti-dilutive impact of the "Conversion Spread Hedges" (see “Non-GAAP Financial Measures” below) on diluted common shares outstanding related to outstanding convertible notes, and
- includes the dilutive impact of additional shares of unvested restricted stock, restricted stock units and performance share units because pro forma net income has been adjusted to exclude stock-based compensation.
In addition, pro forma EBITDA excludes depreciation and amortization expense and includes the impact of foreign currency transactions and other expenses.
When aggregated, the foregoing adjustments are expected to increase pro forma EBITDA over GAAP net income by approximately $50 million in the 1st quarter 2010. In addition, the foregoing adjustments are expected to increase pro forma net income over GAAP net income by approximately $25 million in the 1st quarter 2010. On a per share basis, the Company estimates GAAP net income of approximately $1.04 to $1.14 per diluted share for the 1st quarter 2010.
Information About Forward-Looking Statements
This press release contains forward-looking statements. These forward-looking statements reflect the views of the Company’s management regarding current expectations and projections about future events and are based on currently available information and current foreign currency exchange rates. These forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict; therefore, actual results may differ materially from those expressed, implied or forecasted in any such forward-looking statements. Expressions of future goals and similar expressions including, without limitation, “may,” “will,” “should,” “could,” “expects,” “does not currently expect,” “plans,” “anticipates,” “intends,” “believes,” “estimates,” “predicts,” “potential,” “targets,” or “continue," reflecting something other than historical fact are intended to identify forward-looking statements.
The following factors, among others, could cause the Company's actual results to differ materially from those described in the forward-looking statements:
-- adverse changes in general market conditions for leisure and other travel services as a result of, among other things, decreased consumer spending, general economic downturn, terrorist attacks, natural disasters or adverse weather, the bankruptcy or insolvency of a major airline, or the outbreak of an epidemic or pandemic disease, such as the recent swine flu outbreak;
-- adverse changes in the Company’s relationships with airlines and other product and service providers and vendors which could include, without limitation, the withdrawal of suppliers from the priceline.com system (either priceline.com’s “retail” or “opaque” services, or both) and/or the loss or reduction of global distribution fees;
-- fluctuations in foreign exchange rates and other risks associated with doing business in multiple currencies;
-- the effects of increased competition, including the potential impact of increased pricing competition initiated by other on-line travel agents toward the end of 1st quarter 2009 in the form of reduced booking fees and/or the launch by competitors of an “opaque” travel offering;
-- an adverse outcome in one or more of the hotel occupancy and other tax proceedings in which the Company is involved;
-- a change by a major search engine to its search engine algorithms that negatively affects the search engine ranking of the company or its 3rd party distribution partners;
-- our ability to expand successfully in international markets;
-- the ability to attract and retain qualified personnel;
-- difficulties integrating recent or future acquisitions, such as the 4th quarter 2007 acquisition of Agoda, including ensuring the effectiveness of the design and operation of internal controls and disclosure controls of acquired businesses;
-- the occurrence of an external or internal security breach of our systems or other Internet based systems involving personal customer information, credit card information or other sensitive data;
-- systems-related failures and/or security breaches, including without limitation, “denial-of-service” type attacks on our system, any security breach that results in the theft, transfer or unauthorized disclosure of customer information, or the failure to comply with various state laws applicable to the company’s obligations in the event of such a breach; and
--legal and regulatory risks.
For a detailed discussion of these and other factors that could cause the Company's actual results to differ materially from those described in the forward-looking statements, please refer to the Company's most recent Form 10-Q, Form 10-K and Form 8-K filings with the Securities and Exchange Commission. Unless required by law, the Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
Non-GAAP Financial Measures
Pro forma EBITDA represents GAAP net income excluding depreciation and amortization expense, interest income and expense, equity in income and loss of investees, income attributable to noncontrolling interests and income taxes and the pro forma adjustments relating to stock-based compensation expense and related payroll taxes, gains and losses on debt extinguishment, charges or benefits related to judgments, rulings, or settlements of hotel occupancy tax proceedings and the non-recurring favorable litigation settlement relating to credit card processing costs described below.
Pro forma EBITDA, pro forma net income and pro forma net income per share are "non-GAAP financial measures," as such term is defined by the Securities and Exchange Commission, and may differ from non-GAAP financial measures used by other companies. Priceline.com believes that pro forma EBITDA, pro forma net income and pro forma net income per share that exclude certain non-cash or non-recurring income or expense items are useful for analysts and investors to evaluate priceline.com's future on-going performance because they enable a more meaningful comparison of priceline.com's projected cash earnings and performance with its historical results from prior periods. These pro forma metrics, in particular pro forma EBITDA and pro forma net income, are not intended to represent funds available for priceline.com’s discretionary use and are not intended to represent or to be used as a substitute for operating income, net income or cash flows from operations data as measured under GAAP. The items excluded from these pro forma metrics, but included in the calculation of their closest GAAP equivalent, are significant components of consolidated statements of income and must be considered in performing a comprehensive assessment of overall financial performance.
Pro forma financial information is adjusted for the following items:
- Amortization expense of acquisition-related intangibles is excluded because it does not impact cash earnings.
- Cash benefit associated with the favorable resolution of litigation related to credit card processing costs is excluded because of the non-recurring nature of the settlement.
- Charges or benefits related to judgments, rulings, or settlements of hotel occupancy tax proceedings are excluded because the amount and timing of these items are unpredictable, not driven by core operating results and render comparisons with prior periods less meaningful.
- Stock-based compensation expense is excluded because it does not impact cash earnings and is reflected in earnings per share through increased share count.
- Payroll tax expense related to stock-based compensation is excluded for 2008 because the expense is driven primarily by stock option exercise and share award vesting activity and the market price of priceline.com’s common stock and often shows volatility unrelated to operating results. As of January 1, 2009, we no longer exclude payroll tax expense related to stock-based compensation due to its relative insignificance to our consolidated financial statements.
- Interest expense related to the amortization of debt discount and gains or losses on debt extinguishment recorded in 2009, and in 2008 on a retrospective basis, related to cash settled convertible debt are excluded because they are non-cash in nature. In accordance with the related accounting standards, certain debt issuance costs were reclassified to equity and are therefore no longer amortized in GAAP or pro forma earnings (as of January 1, 2009).
- Income tax expense is adjusted for the tax impact of certain of the pro forma adjustments described above and to exclude tax expense recorded where no actual tax payments are owed because of available net operating loss carry forwards. Income tax expense is also adjusted to exclude the $183.3 million non-cash tax benefit from reversing a portion of the deferred tax asset valuation allowance primarily in 3rd quarter 2009.
- Net income attributable to non-controlling interests is adjusted for the impact of certain of the pro forma adjustments described above.
- For calculating pro forma net income per share:
- net income is adjusted for the impact of the pro forma adjustments described above.
- fully diluted share count is adjusted to include the anti-dilutive impact of “Conversion Spread Hedges” related to priceline.com’s convertible securities that increase the effective conversion price of the currently outstanding 0.50% convertible notes due 2011 and 0.75% convertible notes due 2013 from their stated $40.38 conversion price to an effective conversion price of $50.47 per share. Under GAAP, the anti-dilutive impact of the Conversion Spread Hedges is not reflected on the outstanding diluted share count until the end of the hedge in 2011 and 2013 if and when shares are delivered.
- all unvested shares of restricted common stock, restricted stock units and performance share units are included in the calculation of pro forma net income per share because pro forma net income has been adjusted to exclude stock-based compensation expense.
The presentation of this financial information should not be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles in the United States. The attached financial and statistical supplement reconciles pro forma financial information with priceline.com’s financial results under GAAP.
About Priceline.com® Incorporated
Priceline.com Incorporated (Nasdaq: PCLN) www.priceline.com provides online travel services in 32 languages in over 90 countries in Europe, North America, Asia, the Middle East and Africa. Included in the priceline.com family of companies is Booking.com, a leading international online hotel reservation service, priceline.com, a leading U.S. online travel service for value-conscious leisure travelers, and Agoda.com, an Asian online hotel reservation service. Priceline.com believes that Booking.com is Europe’s largest and fastest growing online hotel reservation service. Booking.com operates in 76 countries in 25 languages and offers its customers access to approximately 78,000 participating hotels worldwide.
In the U.S., priceline.com gives customers more ways to save on their airline tickets, hotel rooms, rental cars, vacation packages and cruises than any other Internet travel service. In addition to getting great published prices, leisure travelers can narrow their searches using priceline.com’s TripFilter advanced search technology, customize their search activity through priceline.com’s Inside Track features, create packages to save even more money, and take advantage of priceline.com’s famous Name Your Own Price® service, which can deliver the lowest prices available. Priceline.com operates the following travel websites: Travelweb.com, Lowestfare.com, RentalCars.com and BreezeNet.com. Priceline.com also licenses its business model to independent licensees.
priceline.com Incorporated
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
December 31,
December 31, 2008
ASSETS 2009 As Adjusted
---- -----------
Current assets:
Cash and cash equivalents $202,141 $364,550
Restricted cash 1,319 2,528
Short-term investments 598,014 98,888
Accounts receivable, net of
allowance for doubtful accounts
of $5,023 and $8,429, respectively 118,659 92,328
Prepaid expenses and other current
assets 36,828 23,463
Deferred income taxes 65,980 12,142
------ ------
Total current assets 1,022,941 593,899
Property and equipment, net 30,489 29,404
Intangible assets, net 172,080 193,231
Goodwill 350,630 326,863
Deferred income taxes 253,700 153,955
Other assets 4,384 15,069
----- ------
Total assets $1,834,224 $1,312,421
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $60,568 $46,290
Accrued expenses and other current
liabilities 127,561 77,713
Deferred merchant bookings 60,758 29,664
Convertible debt 159,878 317,910
------- -------
Total current liabilities 408,765 471,577
Deferred taxes 43,793 48,933
Other long-term liabilities 24,052 18,010
------ ------
Total liabilities 476,610 538,520
------- -------
Convertible debt 35,985 75,075
------ ------
Stockholders' equity:
Common stock, $0.008 par value,
authorized 1,000,000,000 shares,
52,446,173, and 47,664,766 shares
issued, respectively 405 367
Treasury stock, 6,865,119 and
6,685,048 shares, respectively (510,970) (493,555)
Additional paid-in capital 2,289,867 2,176,556
Accumulated deficit (454,673) (944,145)
Accumulated other comprehensive
income (3,000) (40,397)
------ -------
Total stockholders' equity 1,321,629 698,826
--------- -------
Total liabilities and stockholders'
equity $1,834,224 $1,312,421
========== ==========
priceline.com Incorporated
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, 2009 December 31, 2009
----------------- -----------------
2008 2008
2009 As Adjusted 2009 As Adjusted
---- ----------- ---- -----------
Merchant revenues $317,407 $268,816 $1,447,576 $1,218,162
Agency revenues 220,496 132,973 868,395 648,792
Other revenues 3,850 4,252 22,241 17,852
----- ----- ------ ------
Total revenues 541,753 406,041 2,338,212 1,884,806
Cost of revenues 228,564 200,976 1,077,449 928,835
------- ------- --------- -------
Gross profit 313,189 205,065 1,260,763 955,971
------- ------- --------- -------
Operating expenses:
Advertising - Offline 5,978 7,779 36,270 38,032
Advertising - Online 92,054 55,761 365,381 270,713
Sales and marketing 17,655 20,233 81,238 77,948
Personnel, including
stock-based
compensation of
$7,944, $11,452,
$40,671, and $40,522,
respectively 44,819 41,998 180,152 163,785
General and
administrative 19,673 15,749 68,555 55,267
Information technology 5,137 4,268 19,139 17,956
Depreciation and
amortization 10,011 10,444 39,193 42,796
------ ------ ------ ------
Total operating
expenses 195,327 156,232 789,928 666,497
------- ------- ------- -------
Operating income 117,862 48,833 470,835 289,474
------- ------ ------- -------
Other income (expense):
Interest income 528 1,521 2,223 11,660
Interest expense (4,863) (7,532) (24,084) (34,853)
Foreign currency
transactions and
other (5,389) 11,333 (6,672) 9,824
------ ------ ------ -----
Total other
income (expense) (9,724) 5,322 (28,533) (13,369)
------ ----- ------- -------
Earnings before
income taxes and
equity in income
(loss) of investees 108,138 54,155 442,302 276,105
Income tax benefit
(expense) (29,683) (19,962) 47,168 (90,171)
Equity in income
(loss) of investees - (47) 2 (310)
--- --- --- ----
Net income 78,455 34,146 489,472 185,624
Less: net income
attributable to
noncontrolling
interests - - - 3,378
--- --- --- -----
Net income applicable
to common
stockholders of
priceline.com
Incorporated $78,455 $34,146 $489,472 $182,246
======= ======= ======== ========
Net income applicable
to common
stockholders per
basic common share $1.77 $0.84 $11.54 $4.64
===== ===== ====== =====
Weighted average
number of basic
common shares
outstanding 44,350 40,504 42,406 39,299
====== ====== ====== ======
Net income applicable
to common
stockholders per
diluted common share $1.55 $0.75 $9.88 $3.74
===== ===== ===== =====
Weighted average
number of diluted
common shares
outstanding 50,570 45,550 49,522 48,671
====== ====== ====== ======
priceline.com Incorporated
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Year Ended
December 31,
--------------
2008
OPERATING ACTIVITIES: 2009 As Adjusted
---- -----------
Net income $489,472 $185,624
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 14,491 14,388
Amortization 24,702 28,680
Provision for uncollectible accounts, net 3,227 13,113
Reversal of valuation allowance on
deferred tax asset (183,272) -
Other deferred income taxes 30,990 19,899
Stock-based compensation expense 40,671 40,522
Amortization of debt issuance costs 2,465 2,525
Amortization of debt discount 18,203 26,669
Loss (gain) on extinguishment of debt 1,048 (6,014)
Equity in (income) loss of investees (2) 310
Loss on impairment of investment - 843
Changes in assets and liabilities:
Accounts receivable (22,767) (42,888)
Prepaid expenses and other current assets (979) (5,153)
Accounts payable, accrued expenses and
other current liabilities 86,792 32,245
Other 4,624 4,790
----- -----
Net cash provided by operating activities 509,665 315,553
------- -------
INVESTING ACTIVITIES:
Purchase of investments (922,163) (196,308)
Maturity of investments 432,184 218,555
Purchase of shares held by noncontrolling
interests - (154,034)
Additions to property and equipment (15,106) (18,322)
Acquisitions and other equity
investments, net of cash acquired (1,500) (599)
Proceeds from redemption of equity
investment in pricelinemortgage.com 8,921 -
Realized loss on foreign currency
forward contracts (5,025) -
Change in restricted cash 1,229 (1,197)
----- ------
Net cash used in investing activities (501,460) (151,905)
-------- --------
FINANCING ACTIVITIES:
Payments related to conversion of
senior notes (197,122) (176,943)
Repurchase of common stock (17,415) (4,449)
Proceeds from exercise of stock options 43,428 5,507
Excess tax benefit on stock-based
compensation 2,149 7,037
----- -----
Net cash used in financing activities (168,960) (168,848)
-------- --------
Effect of exchange rate changes on cash
and cash equivalents (1,654) (15,609)
------ -------
Net decrease in cash and cash equivalents (162,409) (20,809)
Cash and cash equivalents, beginning of
period 364,550 385,359
------- -------
Cash and cash equivalents, end of period $202,141 $364,550
-------- --------
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for income
taxes $95,512 $66,948
======= =======
Cash paid during the period for
interest $4,448 $6,353
====== ======
priceline.com Incorporated
UNAUDITED RECONCILIATION OF GAAP TO PRO FORMA FINANCIAL INFORMATION
(In thousands, except per share data)
Three Months Year
Ended Ended
December 31, December 31,
------------- ------------
RECONCILIATION OF GAAP 2008 2008
NET INCOME TO PRO FORMA As As
EBITDA 2009 Adjusted (1) 2009 Adjusted (1)
---- ------------ ---- ------------
GAAP Net income
applicable to
common stockholders of
priceline.com,
Incorporated $78,455 $34,146 $489,472 $182,246
(a) Amortization of
acquired intangible
assets in Cost
of revenues - - - 272
(b) Favorable litigation
settlement related
to credit card
processing costs (1,049) - (1,049) -
(c) Stock-based
compensation 7,944 11,452 40,671 40,522
(d) Charge related to
hotel occupancy
tax litigation
judgement in General
and administrative
expense - - 3,680 -
(e) Stock-based
compensation
payroll taxes - 10 - 719
(f) Depreciation and
amortization 10,011 10,444 39,193 42,796
(g) Interest expense
(income) 884 1,067 3,658 (2,285)
(h) Amortization
related to cash
settled
convertible debt 3,451 4,944 18,203 25,478
(h) (Gain) loss on
extinguishment of
debt 3,784 (5,970) 1,048 (6,014)
(i) Adjustments for the
tax impact of
certain of the pro
forma adjustments
and to exclude
non-cash income taxes 29,683 19,962 (47,168) 90,171
(j) Equity in (income)
loss of investee - 47 (2) 310
(k) Impact on
noncontrolling
interests of other
pro forma adjustments - - - 3,378
Pro Forma EBITDA $133,163 $76,102 $547,706 $377,593
======== ======= ======== ========
Three Months Year
Ended Ended
December 31, December 31,
------------- ------------
RECONCILIATION OF
GAAP TO PRO FORMA
NET INCOME 2008 2008
APPLICABLE TO As As
COMMON STOCKHOLDERS 2009 Adjusted (1) 2009 Adjusted (1)
---- ------------ ---- ------------
GAAP Net income
applicable to
common stockholders
of priceline.com,
Incorporated $78,455 $34,146 $489,472 $182,246
(a) Amortization of
acquired intangible
assets in Cost
of revenues - - - 272
(a) Amortization of
acquired intangible
assets in Depreciation
and amortization 6,115 6,855 24,657 28,408
(b) Favorable litigation
settlement related
to credit card
processing fees (1,049) - (1,049) -
(c) Stock-based
compensation 7,944 11,452 40,671 40,522
(d) Charge related to
hotel occupancy
tax litigation
judgement in General
and administrative
expense - - 3,680 -
(e) Stock-based compensation
payroll taxes - 10 - 719
(h) Amortization related
to cash settled
convertible debt 3,451 4,944 18,203 25,478
(h) (Gain) loss on
extinguishment of
debt 3,784 (5,970) 1,048 (6,014)
(i) Adjustments for the
tax impact of
certain of the pro
forma adjustments
and to exclude
non-cash income taxes 2,949 6,792 (151,433) 20,023
(k) Impact on
noncontrolling
interests of other
pro forma
adjustments - - - (818)
Pro Forma Net
income applicable
to common
stockholders of
priceline.com,
Incorporated $101,649 $58,229 $425,249 $290,836
======== ======= ======== ========
Three Months Year
Ended Ended
December 31, December 31,
------------- ------------
RECONCILIATION OF
GAAP TO PRO FORMA
NET INCOME APPLICABLE
TO COMMON STOCKHOLDERS 2008 2008
PER DILUTED As As
COMMON SHARE 2009 Adjusted (1) 2009 Adjusted (1)
---- ------------ ---- ------------
GAAP weighted
average number of
diluted common
shares outstanding 50,570 45,550 49,522 48,671
(l) Adjustment for
Conversion Spread
Hedges (284) (1,368) (505) (859)
(m) Adjustment for
restricted stock,
restricted stock
units and
performance units 787 1,106 886 989
Pro Forma Weighted
average number of
diluted common
shares outstanding 51,073 45,288 49,903 48,801
====== ====== ====== ======
Net income
applicable to
common stockholders
per diluted
common share
GAAP $1.55 $0.75 $9.88 $3.74
===== ===== ===== =====
Pro Forma $1.99 $1.29 $8.52 $5.96
===== ===== ===== =====
(1) 2008 reported "As Adjusted" for new accounting standards related to
cash settled convertible debt and noncontrolling interests.
(a) Amortization of acquired intangible assets is recorded in Cost of
revenues and Depreciation and amortization.
(b) Cash benefit associated with the favorable resolution of litigation
related to credit card processing costs is excluded because of the
nonrecurring nature of the settlement.
(c) Stock-based compensation is recorded in Personnel expense.
(d) Charge related to Texas hotel occupancy tax litigation judgement is
recorded in General and administrative expense.
(e) Stock-based compensation payroll taxes are recorded in General and
administrative expense. As of January 1, 2009, we no longer exclude
payroll tax expense related to stock-based compensation due to its
relative insignificance to our consolidated financial statements.
(f) Depreciation and amortization are excluded from Net income to
calculate EBITDA.
(g) Interest expense (primarily coupon interest paid on our convertible
notes and amortization of deferred issuance costs) and interest
income (primarily from cash and marketable securities) are excluded
from Net income to calculate EBITDA.
(h) Non-cash interest expense related to the amortization of debt
discount and (gain) loss on debt extinguishment are recorded in
Interest expense and Foreign currency transactions and other,
respectively.
(i) Adjustments for the tax impact of certain of the pro forma
adjustments and to exclude non-cash income taxes (including the
non-cash benefit of $183.3 million primarily in 3rd quarter 2009 from
the reversal of a portion of the valuation allowance on the Company's
deferred tax asset).
(j) Equity in (income) loss of investee is excluded from Net income to
calculate EBITDA.
(k) Impact on noncontrolling interests of other pro forma adjustments are
recorded in Net income attributable to noncontrolling interests.
(l) Reflects the impact of the Conversion Spread Hedges that increase the
effective conversion price of the currently outstanding Convertible
Senior Notes due September 30, 2011 and the Convertible Senior Notes
due September 30, 2013 from their stated $40.38 conversion price to
an effective conversion price of $50.47 per share. Under GAAP, the
anti-dilutive impact of the Conversion Spread Hedges is not reflected
on the outstanding diluted share count until the end of the hedge
when shares are delivered.
(m) All shares of restricted common stock, restricted stock units and
performance share units are included in the calculation of pro forma
net income per share because pro forma net income has been adjusted
to exclude stock-based compensation expense.
priceline.com Incorporated
--------------------------
Statistical Data
In thousands
(Unaudited)
Gross Bookings 3Q07 4Q07
-------------- ---- ----
Domestic $602,205 $525,571
International** 788,478 679,760
------- -------
Total $1,390,683 $1,205,331
Agency $1,042,619 $912,698
Merchant** 348,064 292,633
------- -------
Total $1,390,683 $1,205,331
Year/Year Growth
----------------
Domestic 19.3% 24.2%
International 97.9% 113.0%
excluding F/X
impact 83.4% 89.9%
Agency 73.7% 85.9%
Merchant 15.0% 16.4%
Total 54.0% 62.4%
Units Sold 3Q07 4Q07
---------- ---- ----
Hotel Room-Nights 7,964 6,616
Year/Year Growth 52.0% 55.1%
Rental Car Days 2,338 2,002
Year/Year Growth 14.4% 11.9%
Airline Tickets 819 790
Year/Year Growth 23.0% 34.4%
3Q07 4Q07
---- ----
Revenue $417,287 $334,853
Year/Year Growth 33.1% 28.8%
Gross Profit $202,331 $160,152
Year/Year Growth 63.8% 60.9%
Gross Bookings 1Q08 2Q08 3Q08 4Q08
-------------- ---- ---- ---- ----
Domestic $720,968 $872,284 $799,578 $688,923
International** 1,037,644 1,237,681 1,250,850 792,190
--------- --------- --------- -------
Total $1,758,612 $2,109,965 $2,050,427 $1,481,113
Agency $1,370,119 $1,656,775 $1,603,693 $1,108,024
Merchant** 388,493 453,190 446,734 373,089
------- ------- ------- -------
Total $1,758,612 $2,109,965 $2,050,427 $1,481,113
Year/Year Growth
----------------
Domestic 50.6% 59.2% 32.8% 31.1%
International 99.7% 80.1% 58.6% 16.5%
excluding F/X
impact 75.0% 55.8% 44.7% 27.6%
Agency 92.8% 80.2% 53.8% 21.4%
Merchant 34.9% 43.6% 28.3% 27.5%
Total 76.1% 70.9% 47.4% 22.9%
Units Sold 1Q08 2Q08 3Q08 4Q08
---------- ---- ---- ---- ----
Hotel Room-Nights 9,375 10,879 11,434 9,126
Year/Year Growth 57.4% 50.2% 43.6% 38.0%
Rental Car Days 2,612 2,815 2,333 2,224
Year/Year Growth 30.4% 23.6% -0.2% 11.1%
Airline Tickets 1,169 1,362 1,186 1,135
Year/Year Growth 83.0% 98.2% 44.8% 43.7%
1Q08 2Q08 3Q08 4Q08
---- ---- ---- ----
Revenue $403,180 $513,976 $561,609 $406,041
Year/Year Growth 33.8% 44.4% 34.6% 21.3%
Gross Profit $181,103 $253,725 $316,078 $205,065
Year/Year Growth 51.3% 61.4% 56.2% 28.0%
Gross Bookings 1Q09 2Q09 3Q09 4Q09
-------------- ---- ---- ---- ----
Domestic $851,157 $964,464 $998,715 $830,983
International** 1,092,427 1,414,714 1,724,131 1,433,471
--------- --------- --------- ---------
Total $1,943,584 $2,379,178 $2,722,846 $2,264,454
Agency $1,469,956 $1,824,618 $2,130,571 $1,766,295
Merchant** 473,628 554,560 592,275 498,159
------- ------- ------- -------
Total $1,943,584 $2,379,178 $2,722,846 $2,264,454
Year/Year Growth
----------------
Domestic 18.1% 10.6% 24.9% 20.6%
International 5.3% 14.3% 37.8% 81.0%
excluding F/X
impact 23.5% 32.4% 48.5% 69.5%
Agency 7.3% 10.1% 32.9% 59.4%
Merchant 21.9% 22.4% 32.6% 33.5%
Total 10.5% 12.8% 32.8% 52.9%
Units Sold 1Q09 2Q09 3Q09 4Q09
---------- ---- ---- ---- ----
Hotel Room-Nights 12,785 15,665 17,869 14,593
Year/Year Growth 36.4% 44.0% 56.3% 59.9%
Rental Car Days 3,014 3,237 2,604 2,370
Year/Year Growth 15.4% 15.0% 11.6% 6.6%
Airline Tickets 1,496 1,551 1,544 1,318
Year/Year Growth 28.0% 13.9% 30.2% 16.2%
1Q09 2Q09 3Q09 4Q09
---- ---- ---- ----
Revenue $462,058 $603,741 $730,660 $541,753
Year/Year Growth 14.6% 17.5% 30.1% 33.4%
Gross Profit $208,330 $305,238 $434,006 $313,189
Year/Year Growth 15.0% 20.3% 37.3% 52.7%
Gross Bookings represent the total dollar value of travel booked,
inclusive of taxes and fees.
** Includes $37.5 million, $32.4 million, $24.2 million, $24.6 million and
$13.4 million of Agoda gross bookings in 4Q08, 3Q08, 2Q08, 1Q08 and
4Q07, respectively since acquisition on November 6, 2007.
SOURCE Priceline.com
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