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Expedia Inc. Reports Operating Results (10-Q)

July 27, 2012 | About:

10qk

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Expedia Inc. (EXPE) filed Quarterly Report for the period ended 2012-06-30.

Expedia Inc has a market cap of $5.99 billion; its shares were traded at around $45.75 with a P/E ratio of 14.8 and P/S ratio of 1.7. The dividend yield of Expedia Inc stocks is 0.8%. Expedia Inc had an annual average earning growth of 4.1% over the past 5 years.

Highlight of Business Operations:

Revenue increased for the three and six months ended June 30, 2012, compared to the same periods in 2011, primarily due to an increase in hotel room nights stayed partially offset by a decrease in revenue per room night and revenue per ticket. Egencias acquisition of VIA Travel in the second quarter of 2012 added approximately 2% to year-over-year growth to total revenue for the second quarter of 2012. In addition, during the three and six months ended June 30, 2012, we recorded an out of period increase to hotel revenue of approximately $8 million and $5 million to correct a prior period overstatement related to sales and use tax in certain jurisdictions, which are recorded in net revenue. Excluding this adjustment, revenue increased 13% for the three and six month periods of June 30, 2012 compared to the same periods in 2011.

Worldwide hotel revenue increased 16% and 17% for the three and six months ended June 30, 2012, compared to the same periods in 2011. The increase was primarily due to a 22% and 23% increase in room nights stayed, partially offset by a 5% decrease in revenue per room night for both periods. Revenue per room night decreased primarily due to changes in our hotel product mix, discounting at the Hotwire brand, impacts from foreign currency and accruals for loyalty programs at Expedia and Hotels.com.

Worldwide air revenue decreased 8% and 13% for the three and six months ended June 30, 2012, compared to the same periods in 2011, due to an 11% and 16% decrease in revenue per air ticket, partially offset by a 3% and 4% increase in air tickets sold. The increase in air tickets sold primarily relates to the VIA Travel acquisition and was partially offset by volume pressure associated with a 5% and 6% increase in average ticket prices for the periods. In addition, the year-over-year increase for air tickets sold for six months ended June 30, 2012 was also due to the availability of American Airlines tickets in the current year that were not available to our leisure consumers during the first quarter of 2011. Revenue per air ticket declined for both the quarterly and year-to-date periods due to lower net supplier economics and impacts from foreign exchange, partially offset by certain regional and interline consumer booking fees.

Our effective tax rate was 21.3% and 21.0% for the three and six months ended June 30, 2012, which was lower than the 35% federal statutory rate primarily due to estimated earnings in jurisdictions outside the United States.

Our effective tax rate was 27.3% and 27.7% for the three and six months ended June 30, 2011, which was lower than the 35% federal statutory rate primarily due to estimated earnings in jurisdictions outside the United States, partially offset by state income taxes and accruals related to uncertain tax positions.

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10qk
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