Travelzoo Inc (TZOO, Financial) filed Quarterly Report for the period ended 2009-03-31.
Travelzoo Inc publishes Travelzoo and Weekend.com. Reaching several million users per month Travelzoo lists sales and specials from more than 200 advertisers including Alamo Rent-a-Car American Airlines American Express Travel Avis Rent A Car Best Western International British Airways Carnival Cruise Lines Delta Air Lines Fairmont Hotels & Resorts Funjet Vacations Gate 1 Travel Ian Schrager Hotels JetBlue Airways Kimpton Hotel & Restaurant Group Marriott Hotels Omni Hotels Pleasant Holidays Royal Caribbean Cruises Six Continents Hotels Starwood Hotels & Resorts Vail Resorts Virgin Atlantic Airways and Wyndham Hotels & Resorts. Travelzoo Inc has a market cap of $144.54 million; its shares were traded at around $8.79 with and P/S ratio of 1.78. Travelzoo Inc had an annual average earning growth of 66.8% over the past 5 years.
Average annualized revenue per employee decreased to $454,000 for the three months ended March 31, 2009 from $471,000 for the three months ended March 31, 2008. The decrease in average revenue per employee for the three months ended March 31, 2009 compared to the three months ended March 31, 2008 was primarily due to the increase in headcount related to the growth of our business in Europe.
Cost of revenues consists primarily of network expenses, including fees we pay for co-location services, depreciation of network equipment, payments made to third-party partners of the Travelzoo Network, and salary expenses associated with network operations staff. Our cost of revenues increased to $1.3 million for the three months ended March 31, 2009 from $529,000 for the three months ended March 31, 2008. As a percentage of revenue, cost of revenues increased to 5.4% for the three months ended March 31, 2009 from 2.5% for the three months ended March 31, 2008. The $734,000 increase in cost of revenues for the three months ended March 31, 2009 compared to the three months ended March 31, 2008 was primarily due to a $226,000 increase in payments made to third-party partners of the Travelzoo Network, a $194,000 increase in depreciation and maintenance costs, and a $138,000 increase in fees we pay for co-location services.
Sales and marketing expenses consist primarily of advertising and promotional expenses, salary expenses associated with sales, marketing and production staff, expenses related to our participation in industry conferences, and public relations expenses. Sales and marketing expenses decreased to $12.3 million for the three months ended March 31, 2009 from $13.4 million for the three months ended March 31, 2008. The goal of our advertising was to acquire new subscribers for our e-mail products, increase the traffic to our Web sites, and increase brand awareness for Travelzoo. The $1.1 million decrease in sales and marketing expenses for the three months ended March 31, 2009 compared to the three months ended March 31, 2008 was primarily due to a $1.1 million decrease in advertising to acquire new subscribers for our e-mail products and a $761,000 decrease in brand, trade and other marketing expense offset by a $928,000 increase in salary and employee related expenses due primarily to an increase in headcount. For the three months ended March 31, 2009 and 2008, advertising expenses accounted for 58% and 67%, respectively, of total sales and marketing expenses.
General and administrative expenses consist primarily of compensation for administrative, executive, and software development staff, fees for professional services, rent, bad debt expense, amortization of intangible assets, and general office expense. General and administrative expenses increased to $6.9 million for the three months ended March 31, 2009 from $5.7 million for the three months ended March 31, 2008. The $1.2 million increase in general and administrative expenses was primarily due to a $737,000 increase in salary and employee related expenses due primarily to an increase in headcount, a $261,000 increase in bad debt expense and a $193,000 increase in depreciation and amortization expenses.
For the three months ended March 31, 2009 and March 31, 2008, the Company recorded expense of $1,000 and $7,000, respectively, related to a program under which the Company makes cash payments to people who establish that they were former stockholders of Travelzoo.com Corporation, and who failed to submit requests for shares in Travelzoo Inc. within the required time period. The expense is based on the number of actual valid claims received and the Companys stock price. The Company cannot reliably estimate future expenses incurred under this program because it is based on the number of valid requests received and future levels of the Companys common stock price.
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Travelzoo Inc publishes Travelzoo and Weekend.com. Reaching several million users per month Travelzoo lists sales and specials from more than 200 advertisers including Alamo Rent-a-Car American Airlines American Express Travel Avis Rent A Car Best Western International British Airways Carnival Cruise Lines Delta Air Lines Fairmont Hotels & Resorts Funjet Vacations Gate 1 Travel Ian Schrager Hotels JetBlue Airways Kimpton Hotel & Restaurant Group Marriott Hotels Omni Hotels Pleasant Holidays Royal Caribbean Cruises Six Continents Hotels Starwood Hotels & Resorts Vail Resorts Virgin Atlantic Airways and Wyndham Hotels & Resorts. Travelzoo Inc has a market cap of $144.54 million; its shares were traded at around $8.79 with and P/S ratio of 1.78. Travelzoo Inc had an annual average earning growth of 66.8% over the past 5 years.
Highlight of Business Operations:
Our total revenues increased to $23.4 million for the three months ended March 31, 2009 from $20.9 million for the three months ended March 31, 2008. This represents an increase of $2.4 million or 12%. $1.1 million of the increase in revenues came from our operations in North America and was attributed primarily to increases in revenues from our Travelzoo Web site and Top 20 newsletter, Travelzoo Network, and SuperSearch offset by a decrease in revenues from our Newsflash newsletter. $930,000 of the increase in revenues came from our operations in Europe, which had an increase of 45% in revenues year over year. In local currency terms, revenues from our operations in Europe increased 100% year over year. We also had a $368,000 increase in revenues from our operations in Asia Pacific, which generated $20,000 in revenue for the three months ended March 31, 2008.Average annualized revenue per employee decreased to $454,000 for the three months ended March 31, 2009 from $471,000 for the three months ended March 31, 2008. The decrease in average revenue per employee for the three months ended March 31, 2009 compared to the three months ended March 31, 2008 was primarily due to the increase in headcount related to the growth of our business in Europe.
Cost of revenues consists primarily of network expenses, including fees we pay for co-location services, depreciation of network equipment, payments made to third-party partners of the Travelzoo Network, and salary expenses associated with network operations staff. Our cost of revenues increased to $1.3 million for the three months ended March 31, 2009 from $529,000 for the three months ended March 31, 2008. As a percentage of revenue, cost of revenues increased to 5.4% for the three months ended March 31, 2009 from 2.5% for the three months ended March 31, 2008. The $734,000 increase in cost of revenues for the three months ended March 31, 2009 compared to the three months ended March 31, 2008 was primarily due to a $226,000 increase in payments made to third-party partners of the Travelzoo Network, a $194,000 increase in depreciation and maintenance costs, and a $138,000 increase in fees we pay for co-location services.
Sales and marketing expenses consist primarily of advertising and promotional expenses, salary expenses associated with sales, marketing and production staff, expenses related to our participation in industry conferences, and public relations expenses. Sales and marketing expenses decreased to $12.3 million for the three months ended March 31, 2009 from $13.4 million for the three months ended March 31, 2008. The goal of our advertising was to acquire new subscribers for our e-mail products, increase the traffic to our Web sites, and increase brand awareness for Travelzoo. The $1.1 million decrease in sales and marketing expenses for the three months ended March 31, 2009 compared to the three months ended March 31, 2008 was primarily due to a $1.1 million decrease in advertising to acquire new subscribers for our e-mail products and a $761,000 decrease in brand, trade and other marketing expense offset by a $928,000 increase in salary and employee related expenses due primarily to an increase in headcount. For the three months ended March 31, 2009 and 2008, advertising expenses accounted for 58% and 67%, respectively, of total sales and marketing expenses.
General and administrative expenses consist primarily of compensation for administrative, executive, and software development staff, fees for professional services, rent, bad debt expense, amortization of intangible assets, and general office expense. General and administrative expenses increased to $6.9 million for the three months ended March 31, 2009 from $5.7 million for the three months ended March 31, 2008. The $1.2 million increase in general and administrative expenses was primarily due to a $737,000 increase in salary and employee related expenses due primarily to an increase in headcount, a $261,000 increase in bad debt expense and a $193,000 increase in depreciation and amortization expenses.
For the three months ended March 31, 2009 and March 31, 2008, the Company recorded expense of $1,000 and $7,000, respectively, related to a program under which the Company makes cash payments to people who establish that they were former stockholders of Travelzoo.com Corporation, and who failed to submit requests for shares in Travelzoo Inc. within the required time period. The expense is based on the number of actual valid claims received and the Companys stock price. The Company cannot reliably estimate future expenses incurred under this program because it is based on the number of valid requests received and future levels of the Companys common stock price.
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