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Ambassadors Group Inc. Reports Operating Results (10-Q)

August 07, 2012 | About:
10qk

10qk

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Ambassadors Group Inc. (EPAX) filed Quarterly Report for the period ended 2012-06-30.

Ambassadors Group, Inc. has a market cap of $99 million; its shares were traded at around $5.4 with a P/E ratio of 15.6 and P/S ratio of 1.5. The dividend yield of Ambassadors Group, Inc. stocks is 4.3%.

Highlight of Business Operations:

In addition to our People to People student programs, we operate professional travel programs for adults under the People to People brand (“Citizen Ambassadors Program”) and a student travel operation under the Discovery Student Adventures brand (“DSA”). Our DSA program is associated with Discovery Student Education and operates through a teacher recruited revenue model. Lastly, we operate BookRags (www.bookrags.com), an education oriented research website which provides study guides, lesson plans and other educational resources to students and teachers. The site attracts students and teachers each month to its millions of pages of content, which includes internally developed material, licensed material, and user-generated content.

Associated with the decrease in delegates traveled, gross margin decreased $3.2 million and $2.8 million, respectively, during the second quarter and first six months of 2012 compared to 2011. Gross margin as a percentage of gross revenues declined to 36.5 percent during the second quarter of 2012 compared to 37.7 percent during the second quarter of 2011, primarily due to higher airfare expense associated with rising fuel costs and higher foreign exchange rates year-over-year increasing our land vendor payments. For those same reasons, gross margin as a percentage of gross revenue during the first six months of 2012 was 37 percent compared to 38.1 percent during the first six months of 2011.

The continuation of several cutting initiatives reduced operating expenses by $2.7 million and $4.3 million, respectively, during the second quarter and first six months of 2012 compared to those same periods in 2011. In line with our strategy to reduce overall operating expenses to maximize profitability, these reductions consisted mainly of lower marketing expenses related to travel campaigns and reduced personnel costs associated with a reduction in staffing. These savings were offset by increased legal and professional expenses primarily related to the previously disclosed proxy contest.

In spite of the decline in delegate counts, our cost cutting initiatives discussed above helped increase profitability in the second quarter and first six months of 2012 compared to the same period in 2011. As a result, net income increased $0.8 million and $1.6 million, respectively, in the three and six months ended June 30, 2012, compared to the same periods in 2011.

In spite of the decline in delegate counts, our cost cutting initiatives discussed above helped increase profitability in the second quarter and first six months of 2012 compared to the same period in 2011. As a result, net income increased $0.8 million and $1.6 million, respectively, in the three and six months ended June 30, 2012, compared to the same periods in 2011.

Read the The complete Report

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