Priceline.com Reports 4th Quarter

Priceline.com(R) (NASDAQ: PCLN) today reported that it achieved a pro forma profit for the 4th quarter and full-year 2001.

In the 4th quarter 2001, priceline.com had pro forma net income of $3.3 million, or $0.01 per diluted share, compared to a 4th quarter 2000 pro forma net loss of $25.0 million, or $0.15 per share. Pro forma EBITDA for the 4th quarter 2001 was $6.2 million. Pro forma EBITDA and net income (loss) are stated before restructuring and special charges, supplier warrant charges, option payroll taxes, loss on sale of stock and amortization of stock-based compensation charges, totaling $4.7 million in the 4th quarter 2001 and $80.1 million in the 4th quarter 2000.


Revenue in the 4th quarter 2001 was $235.3 million, which was at the high end of guidance given to financial analysts on November 1st and compares to 4th quarter 2000 revenue of $228.2 million. Gross profit for the 4th quarter 2001 was $39.3 million, compared to a gross profit of $35.1 million in the 4th quarter 2000. Gross margin for the 4th quarter 2001 was 16.7 percent compared to 15.4 percent in last year`s fourth quarter. On a GAAP basis, priceline.com reported a 4th quarter 2001 net loss applicable to common stockholders of $1.3 million, or $0.01 per share, compared to a 4th quarter 2000 GAAP net loss applicable to common stockholders of $105.1 million, or $0.62 per share.


Priceline.com ended 2001 with $164.6 million in cash and short-term investments, compared to a balance of $153.2 million at the end of the third quarter of 2001 and $106.0 million at the end of 2000.


“Priceline performed well in the fourth quarter, achieving year over year growth in revenue and pro forma earnings, despite continuing weakness in airline retail pricing and, consequently, in our airline ticket bind rate,” said Jeffery H. Boyd, priceline.com`s President and Chief Operating Officer. “We continue to diversify our revenue streams to non-air businesses, with hotel and rental car bookings constituting 47 percent of booked offers in the 4th quarter 2001, up from 31 percent in the 4th quarter 2000, and we are poised to benefit from the launch of our new vacation product and marketing alliances as well as from the eventual recovery of retail airline pricing.”

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For the full year 2001, priceline.com had revenue of $1.17 billion, compared to full-year 2000 revenue of $1.24 billion. Gross profit for 2001 was $192.9 million, compared to a pro forma gross profit of $193.7 million for 2000. Pro forma EBITDA for 2001 was $24.4 million. Gross margin for 2001 was 16.5 percent, compared to a 2000 pro forma gross margin of 15.7 percent.


Priceline.com had pro forma net income in 2001 of $15.1 million, or $0.07 per diluted share, compared to a pro forma net loss of $36.1 million, or $0.22 per share in 2000. Pro forma EBITDA and net income (loss) are stated before restructuring and special charges, supplier warrant charges, option payroll taxes, loss on sale of stock and amortization of stock-based compensation charges, totaling $31.0 million in 2001 and $293.4 million in 2000.


Priceline.com said it sold a combined 2.3 million units of travel products during the 4th quarter 2001. The Company sold 789,638 hotel room nights (a 115 percent increase over 4th quarter 2000), 720,213 rental car days (a 38 percent increase over 4th quarter 2000) and 840,191 airline tickets (a 4 percent increase over 4th quarter 2000).


Priceline.com also said that it added 854,082 new customers, raising its year-end 2001 total customer base to nearly 12.7 million. Priceline.com`s customer base at the end of 2000 was 9 million. Repeat business for the 4th quarter 2001 (defined as the number of unique purchase offers coming from repeat customers divided by the number of total unique purchase offers) was a Company-record 63.6 percent, compared to 54.5 percent for the 4th quarter 2000.


“Looking forward, priceline.com is targeting first quarter 2002 revenue of between $260 million and $290 million, consistent with our expectation that industry conditions, and specifically low retail airline pricing, will continue to put pressure on our bind rate.” said Richard Braddock, Chairman and Chief Executive Officer of priceline.com. “We are managing the first quarter to a goal of between zero to two cents pro forma earnings per share, including the effects of a significant increase in online and offline marketing spending and one cent of loss generated by consolidating our European operations.”


Mr. Braddock continued, “Priceline.com`s solid brand position and continued strong customer franchise, as evidenced by strong new and repeat customer metrics, and the continued strength of our hotel and rental car businesses, are delivering solid results for priceline.com even as the airline industry faces difficult challenges. With these strengths and the opportunities afforded by our alliance with eBay, the launch of vacation packages and an eventual recovery of airline retail pricing, we are excited about priceline.com`s prospects for 2002 and we are comfortable with median First Call estimates for full-year 2002 pro forma earnings per share of $0.12.”

 

www.priceline.com

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