Outlook for Travel Industry Improves


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NASDAQ:PCNL / NYSE:OWW
02/28/2013 [ACCESSWIRE]

The ShinesRooms.com Provides Stock Research onpriceline.com Inc. and Orbitz Worldwide Inc.
 
New York City, New York -- 2012 was a challenging year for the travel industry due to the weakness in the global economy. However, the outlook for the travel industry has improved since the start of this year. For companies such as Priceline.com Inc. (NASDAQ: PCNL) and Orbitz Worldwide Inc. (NYSE: OWW), Europe still remains a worry. It will be interesting to see whether improving travel demand from U.S. and emerging markets can offset weakness in Europe. The travel industry is directly impacted by the state of the global economy. Any weakness in the global economy, like last year, does not augur well for the industry.

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2012 was a tough year mainly due to the ongoing Eurozone debt crisis, slowdown in China, and concerns over fiscal cliff. Economic activity in China has picked up since the start of this year. In the U.S., a last minute deal helped in averting the fiscal cliff. As a result, the outlook for the global economy has improved. However, Europe remains a worry. The region is a major market for travel companies and ongoing weakness there means that outlook for the industry remains cautious. Another major trend in the travel industry has been the increasing use of technology to improve customer experience. Travel companies are investing heavily in new technology in order to differentiate their services from competitors. This trend is expected to continue going forward.

Earlier this week, Priceline.com Inc. reported its financial results for the fourth quarter of 2012. The company’s gross profit for the quarter was $940 million, representing an increase of 29.7% over the same period in the previous year. International operations accounted for $836 million of Priceline.com Inc.’s total gross profit for the fourth quarter of 2012. The company’s operating income for the quarter was $374 million, up 23.2% over the same period in the previous year. Our free research report onpriceline.com Inc.can be downloaded upon registration at

http://www.ShinesRooms.com/PCLN022813.pdf  

Jeffrey H. Boyd, Chairman and CEO of Priceline.com, said that the company finished 2012 with a strong fourth quarter showing improving unit growth in hotel room and rental car day reservations. Boyd said that international gross bookings growth of 43% on a local currency basis in the fourth quarter evidenced the resilience of the business in 2012 despite the economic uncertainty in the company’s core European market. Boyd added the company is off to a good start in 2013 and while global economic conditions remain a concern, he is excited about the company’s long-term outlook.

Conversely, Orbitz Worldwide Inc., earlier this month, reported its financial results for the fourth quarter of 2012. The company’s room night growth accelerated 7 percentage points in the fourth quarter of 2012, driven by acceleration in private label distribution and at HotelClub.Orbitz Worldwide Inc.free research is available today at

http://www.ShinesRooms.com/OWW022813.pdf

Orbitz Worldwide Inc.’s Hotel net revenue for the quarter grew to 39% of total revenue. The company’s adjusted EBITDA for the quarter rose 19% to $35.9 million, driven by higher revenue and margin expansion. Net loss for the quarter was $314.6 million as the company took a $321.2 million non-cash goodwill and intangible asset impairment charge.

 

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