Travelzoo Inc. TZOO:
- Revenue of $36.5 million, down 9% year-over-year
- Operating profit of $3.8 million
- Earnings per share of $0.13, compared to $0.31 in the prior-year period
- Cash flow provided by operations was $2.4 million
Travelzoo Inc., a global Internet media company, today announced financial results for the first quarter ended March 31, 2015, with revenue of $36.5 million, a decrease of 9% year-over-year. Net income was $1.9 million, with diluted earnings per share of $0.13, down from $0.31 in the prior-year period.
"In spite of the strong dollar we achieved a sequential 16% increase in revenue over the previous quarter," said Chris Loughlin, chief executive officer. "Travelzoo added more new members than in any other quarter over the past three years."
North America
North America business segment revenue decreased 6% year-over-year to $24.7 million. Operating income for the first quarter was $2.1 million, or 8% of revenue, down from $4.6 million, or 17% of revenue, in the prior-year period.
Europe
Europe business segment revenue decreased 15% year-over-year to $11.8 million. In local currency terms, revenue decreased 7% year-over-year. Operating profit for the first quarter was $1.7 million, or 15% of revenue, down from $2.4 million, or 17% of revenue in the prior-year period.
Members
Travelzoo had a total unduplicated number of members in North America and Europe of 24.5 million as of March 31, 2015, up 1% from December 31, 2014. In North America, total unduplicated number of members was 17.2 million as of March 31, 2015, up 1% from December 31, 2014. In Europe, total unduplicated number of members was 7.5 million as of March 31, 2015, up 2% from December 31, 2014.
Income Taxes
Income tax expense was $1.8 million, compared to $2.5 million income tax expense in the prior-year period. The effective income tax rate was 49%, up from 35% in the prior-year period, driven by certain state tax reserves recorded in the current period.
Asset Management
During the first quarter of 2015, Travelzoo generated $2.4 million of cash from operating activities. Accounts receivable increased by $619,000 over the prior-year period to $16.0 million. Accounts payable decreased by $6.5 million over the prior-year period to $22.5 million. Capital expenditures were $184,000, down from $1.0 million in the prior-year period. As of March 31, 2015, cash and cash equivalents were $54.0 million.
Conference Call
Travelzoo will host a conference call to discuss first quarter results at 11:00 a.m. ET today. Please visit http://www.travelzoo.com/earnings to
- download the management presentation (PDF format) to be discussed in the conference call;
- access the webcast.
About Travelzoo
Travelzoo Inc. is a global Internet media company. With more than 27 million members in North America, Europe, and Asia Pacific and 25 offices worldwide, Travelzoo® publishes deals from more than 2,000 travel and entertainment companies. Travelzoo's deal experts review offers to find the best deals and confirm their true value. In Asia Pacific, Travelzoo is independently owned and operated by Travelzoo (Asia) Ltd. and Travelzoo Japan K.K. under a license agreement with Travelzoo Inc.
Certain statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations, prospects and intentions, markets in which we participate and other statements contained in this press release that are not historical facts. When used in this press release, the words "expect", "predict", "project", "anticipate", "believe", "estimate", "intend", "plan", "seek" and similar expressions are generally intended to identify forward-looking statements. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including changes in our plans, objectives, expectations, prospects and intentions and other factors discussed in our filings with the SEC. We cannot guarantee any future levels of activity, performance or achievements. Travelzoo undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release. Travelzoo and Top 20 are registered trademarks of Travelzoo. All other names are trademarks and/or registered trademarks of their respective owners.
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Travelzoo Inc. |
|||||||||||
| Three months ended | |||||||||||
| March 31, | |||||||||||
| 2015 | 2014 | ||||||||||
| Revenues | $ | 36,492 | $ | 40,195 | |||||||
| Cost of revenues | 4,234 | 4,777 | |||||||||
| Gross profit | 32,258 | 35,418 | |||||||||
| Operating expenses: | |||||||||||
| Sales and marketing | 17,996 | 17,843 | |||||||||
| General and administrative | 10,460 | 10,578 | |||||||||
| Total operating expenses | 28,456 | 28,421 | |||||||||
| Income from operations | 3,802 | 6,997 | |||||||||
| Other income (loss) | (87) | 122 | |||||||||
| Income before income taxes | 3,715 | 7,119 | |||||||||
| Income taxes | 1,806 | 2,481 | |||||||||
| Net income | $ | 1,909 | $ | 4,638 | |||||||
| Net income per share: | |||||||||||
| Basic | $ | 0.13 | $ | 0.31 | |||||||
| Diluted | $ | 0.13 | $ | 0.31 | |||||||
| Weighted average shares: | |||||||||||
| Basic | 14,730 | 14,880 | |||||||||
| Diluted | 14,730 | 14,970 | |||||||||
|
Travelzoo Inc.
|
|||||||||||
|
March 31, |
December 31, |
||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 53,975 | $ | 54,812 | |||||||
| Accounts receivable, net | 15,974 | 14,608 | |||||||||
| Income taxes receivable | 2,885 | 3,756 | |||||||||
| Deposits | 598 | 74 | |||||||||
| Prepaid expenses and other | 2,530 | 2,802 | |||||||||
| Deferred tax assets | 1,482 | 1,311 | |||||||||
| Total current assets | 77,444 | 77,363 | |||||||||
| Deposits | 559 | 1,087 | |||||||||
| Deferred tax assets | 1,482 | 1,460 | |||||||||
| Restricted cash | 1,325 | 1,393 | |||||||||
| Property and equipment, net | 8,693 | 9,022 | |||||||||
| Intangible assets, net | 104 | 163 | |||||||||
|
Total assets |
$ | 89,607 | $ | 90,488 | |||||||
| Liabilities and Stockholders' Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 22,526 | $ | 23,008 | |||||||
| Accrued expenses and other | 10,518 | 10,135 | |||||||||
| Deferred revenue | 1,470 | 1,192 | |||||||||
| Income tax payable | 689 | 574 | |||||||||
| Reserve for unexchanged promotional shares | — | 1,393 | |||||||||
| Total current liabilities | 35,203 | 36,302 | |||||||||
| Long-term tax liabilities | 11,608 | 10,936 | |||||||||
| Long-term deferred rent and other | 3,194 | 3,436 | |||||||||
| Total liabilities | 50,005 | 50,674 | |||||||||
| Common stock | 163 | 163 | |||||||||
| Treasury stock | (21,517) | (21,517) | |||||||||
| Additional paid-in capital | 11,191 | 11,043 | |||||||||
| Accumulated other comprehensive loss | (5,266) | (2,997) | |||||||||
| Retained earnings | 55,031 | 53,122 | |||||||||
| Total stockholders' equity | 39,602 | 39,814 | |||||||||
| Total liabilities and stockholders' equity | $ | 89,607 | $ | 90,488 | |||||||
|
Travelzoo Inc. |
|||||||||||
| Three months ended | |||||||||||
| March 31, | |||||||||||
| 2015 | 2014 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 1,909 | $ | 4,638 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 771 | 701 | |||||||||
| Deferred income taxes | (222) | 76 | |||||||||
| Stock-based compensation | 148 | 395 | |||||||||
| Provision for losses on accounts receivable | 25 | (52) | |||||||||
| Net foreign currency effects | 111 | (9) | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | (1,764) | (1,288) | |||||||||
| Deposits | (37) | 133 | |||||||||
| Income tax receivable | 851 | 1,266 | |||||||||
| Prepaid expenses and other | 281 | 447 | |||||||||
| Accounts payable | 201 | (2,984) | |||||||||
| Accrued expenses and other | 729 | (1,179) | |||||||||
| Income tax payable | 144 | 722 | |||||||||
| Reserve for unexchanged promotional shares | (1,393) | (1,226) | |||||||||
| Other non-current liabilities | 672 | 111 | |||||||||
| Net cash provided by operating activities | 2,426 | 1,751 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Release of restricted cash | — | 200 | |||||||||
| Purchases of property and equipment | (184) | (1,019) | |||||||||
| Net cash used in investing activities | (184) | (819) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Repurchase of common stock | — | (5,569) | |||||||||
| Reverse/forward stock split, including transaction costs | — | (479) | |||||||||
| Net cash used in financing activities | — | (6,048) | |||||||||
| Effect of exchange rate on cash and cash equivalents | (3,079) | (72) | |||||||||
| Net decrease in cash and cash equivalents | (837) | (5,188) | |||||||||
| Cash and cash equivalents at beginning of period | 54,812 | 66,223 | |||||||||
| Cash and cash equivalents at end of period | $ | 53,975 | $ | 61,035 | |||||||
| Supplemental disclosure of cash flow information: | |||||||||||
| Cash paid for income taxes, net | $ | 361 | $ | 335 | |||||||
|
Travelzoo Inc. |
||||||||||||||||||||||||||||||||||
| Three months ended March 31, 2015 |
North America |
Europe |
Elimination |
Consolidated | ||||||||||||||||||||||||||||||
| Revenue from unaffiliated customers | $ | 24,713 | $ | 11,779 | $ | — | $ | 36,492 | ||||||||||||||||||||||||||
| Intersegment revenue | 257 | 38 | (295) | — | ||||||||||||||||||||||||||||||
| Total net revenues | 24,970 | 11,817 | (295) | 36,492 | ||||||||||||||||||||||||||||||
| Operating income | $ | 2,080 | $ | 1,722 | $ | — | $ | 3,802 | ||||||||||||||||||||||||||
| Three months ended March 31, 2014 |
North
America |
Europe |
Elimination |
Consolidated | ||||||||||||||||||||||||||||||
| Revenue from unaffiliated customers | $ | 26,353 | $ | 13,842 | $ | — | $ | 40,195 | ||||||||||||||||||||||||||
| Intersegment revenue | 221 | 12 | (233) | — | ||||||||||||||||||||||||||||||
| Total net revenues | 26,574 | 13,854 | (233) | 40,195 | ||||||||||||||||||||||||||||||
| Operating income | $ | 4,604 | $ | 2,393 | $ | — | $ | 6,997 | ||||||||||||||||||||||||||
Investor Relations:
Travelzoo Inc.
Glen Ceremony, 212-484-4998
Chief
Financial Officer
ir@travelzoo.com
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