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Dollar Thrifty Profit Up: The Rental Car Company Said Its 2005 Earnings Rose Nearly 15 Percent.

Posted on: Saturday, 11 February 2006, 15:00 CST

By D.R. Stewart, Tulsa World, Okla.

Feb. 11--Dollar Thrifty Automotive Group Inc. has reported fourth-quarter earnings of $5.6 million, or 21 cents per share, a 314 percent increase from 2004's fourth quarter. The Tulsa-based rental car company's fourth-quarter revenue was $355.2 million, up 1.7 percent. Executives of Dollar Thrifty said fourth-quarter revenue included a 3.7 percent increase in vehicle rental revenue resulting from a 3 percent increase in rental days combined with a 0.7 percent increase in revenue per day. Vehicle leasing revenue declined in the quarter due to fewer vehicles leased to franchisees resulting primarily from franchisee acquisitions, which was partially offset by higher lease rates, company officials said. For the year, Dollar Thrifty posted earnings of $58.3 million, or $2.21 per share, a 14.9 percent increase from 2004's earnings of $50.8 million, or $1.94 per share. Revenue in 2005 was $1.52 billion, up 6.9 percent. Gary Paxton, president and CEO, said executives were pleased with the company's performance under difficult circumstances. "Our management team and employees demonstrated their ability to manage through an environment of competitive industry pricing, disruptions from hurricanes and the changing landscape of the Internet reservation channels and still grow revenues, net income and profit margins," Paxton said Thursday in a written statement. "We again demonstrated our expertise in efficiently managing our fleet resulting in strong vehicle utilization. In addition, we were able to capture used car market opportunities to lower vehicle costs. Our costs also improved as a result of a change in the vicarious liability laws that will benefit our industry going forward." In the fourth quarter, Dollar Thrifty operated an average of 104,739 vehicles, a 3.8 percent increase from 2004's fourth quarter. Vehicle utilization in the quarter was 83 percent, up 0.7 percent. Average revenue per day was $40.92, a 0.7 percent increase, and monthly average revenue per vehicle was $1,042, a 0.1 percent decrease. For the year, Dollar Thrifty operated an average of 113,002 vehicles, a 10.6 percent increase from 2004. Vehicle utilization was 84.6 percent, a 0.5 percent decrease. Average revenue per day was $39.96, a 0.3 percent decrease. Monthly average revenue per vehicle was $1,029, down 1.2 percent. Dollar Thrifty's board of directors approved a $300 million share repurchase program that will be completed by Dec. 31, 2008. The new program, which will begin immediately, replaces the existing $100 million program in which $44.7 million has been spent to purchase 1.55 million shares. At Dec. 31, the company had $274 million in cash and cash equivalents, a 34 percent increase from a year earlier. "The company has generated a strong cash position, has no nonvehicle debt and is positioned to generate strong cash flow going forward," Paxton said. "With the majority of our franchise acquisition opportunities now behind us, we are confident in our ability to significantly increase share repurchases while still maintaining a strong balance sheet and sufficient liquidity to continue our growth. "We believe repurchasing Dollar Thrifty shares represents an attractive investment at current price levels and demonstrates our commitment to return excess cash to shareholders." Dollar Thrifty shares closed Friday at $38.90, down 26 cents from Thursday's closing price and 99 cents below its 52-week high. ------------ D.R. Stewart 581-8451 don.stewart@tulsaworld.com

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Copyright (c) 2006, Tulsa World, Okla.

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Source: Tulsa World

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