Priceline Profit More Than Doubles

Online travel company Inc. (PCLN) Thursday said its quarterly profit doubled due to strong airline and hotel bookings.

The Norwalk, Conn.-based company said its fourth-quarter net income rose to $5 million, or 12 cents a share, from $2.2 million, or 6 cents a share, a year earlier.

Excluding items, (search) said it earned 22 cents a share, which beat the average analyst estimate of 16 cents a share, as compiled by Reuters Estimates.

"Our retail airline ticketing business did better than we expected," chief executive Jeffery Boyd told Reuters.

"Our airline ticket sales are typically weaker in the fourth quarter because our name your own price product is not the first choice for travel during Thanksgiving and Christmas, but this year we had our retail choice product," the CEO explained. Priceline began at the beginning of last year to offer customers the ability to book airline tickets on specific carriers with exact itineraries.

The company's growth rate for airline ticket sales will be lower in the first quarter of this year since the prior-year period, for the first time, contained both products, the CEO said.

Fourth quarter gross travel bookings rose 61 percent to $414 million, while revenue rose 8.2 percent to $195 million.

Results include the operating results of Active Hotels (search), acquired in September 2004, and Travelweb, acquired in May 2004.

Priceline said year-over-year airline ticket bookings grew 61 percent, hotel room night bookings rose 51 percent and rental car day bookings grew 16 percent.

Looking ahead to 2005, Priceline projected gross travel bookings growth of 30 percent to 35 percent and said pro forma earnings will post the same growth rate.

The company said that it was "comfortable" with current analyst estimates of $1.18 per share for pro forma profit for the full year.

For the first quarter, however, Priceline said it expects pro forma earnings of 18 cents to 22 cents per share and net income of 7 cents to 11 cents per share. Analysts on average expect pro forma earnings of 23 cents a share and net income of 19 cents a share.