Dollar Thrifty Automotive Group Reports Fourth Quarter and Full Year Earnings for 2004
Company achieves record foutth quarter and full year revenue
Executive Director - Corporate Communications
Chief Financial Officer
Tulsa, Oklahoma, February 9, 2005: Dollar Thrifty Automotive Group, Inc. (NYSE: DTG) today reported results for the fourth quarter and year ended December 31, 2004. Total revenue for the fourth quarter was a record $349 million, up 15 percent from the comparable 2003 quarter. Net income for the fourth quarter was $1.4 million, or $.05 per diluted share, compared to a net loss of $8.4 million, or $.33 per diluted share, for the 2003 fourth quarter. During the fourth quarter of 2003, the Company commenced implementation of Emerging Issues Task Force No. 02-16 “Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a Vendor” (“EITF 02-16”). The Company would have earned $.11 per diluted share in the 2003 fourth quarter if EITF 02-16 had been in effect for all prior periods. The 2004 fourth quarter results were negatively impacted by higher costs for insurance reserves and Sarbanes-Oxley compliance.
For the year ended December 31, 2004, the Company’s revenue was a record $1.4 billion, a 16 percent increase over the prior year. Net income was $50.8 million, or $1.94 per diluted share, including the $.14 per share favorable cumulative effect of a change in accounting principle to adopt FASB Interpretation No. 46(R), “Consolidation of Variable Interest Entities”. Net income for 2003 was $19.8 million, or $.78 per diluted share. The Company would have earned $1.29 per diluted share in 2003 if EITF 02-16 had been in effect for all prior periods.
The strong fourth quarter revenue growth was driven by a 19.9 percent increase in vehicle rental revenue resulting from a 21.7 percent increase in rental days. Same store rental days were up 8.2 percent and franchise acquisitions along with greenfield stores contributed another 13.5 percent to rental day growth. Vehicle leasing revenue declined from last year’s fourth quarter primarily due to a shift of vehicles from franchise to corporate operations resulting from franchise acquisitions and to lower lease rates.
Gary Paxton, President and Chief Executive Officer, said, “2004 was a year of outstanding achievements for DTG with record revenue, record vehicle utilization and increased presence at the airports. It was also an outstanding year with respect to a key element of our growth strategy of acquiring both Dollar and Thrifty franchises in the U.S. and Canada. During the year, we acquired 16 markets previously held by franchisees, including Thrifty in Orlando and Los Angeles which are among the largest U.S. car rental markets. Since the implementation of our growth strategy in December 2002, we have acquired 44 U.S. and Canadian markets and opened seven new Dollar or Thrifty greenfield locations adding approximately 27,000 vehicles on an annualized basis to the Company’s rental fleet.“
As previously announced, the Company increased its share repurchase program from $30 million to $100 million. During the fourth quarter, the Company purchased 173,000 shares at a total cost of $4.7 million. Since announcing the program in July 2003, the Company has repurchased 870,300 shares at a total cost of $22.2 million. The repurchase of the remaining authorized shares is expected to be completed by December 31, 2006.
“We expect continued growth in travel in 2005,” Paxton said. “Also, we are becoming more optimistic regarding industry price increases in 2005 with announced plans by automobile manufacturers to constrain vehicle sales to the rental industry. We expect fewer opportunities for incremental low-cost fleet deals and rising interest rates to increase industry vehicle costs in 2005. We will continue to pursue franchise acquisitions and operating efficiencies from our consolidated operating model.” The Company estimates 2005 earnings per share in the range of $2.00 to $2.20 based on achieving 6 to 7 percent growth in same store rental days as compared to 2004, with flat to a 2 percent increase in revenue per day and the impact of franchise acquisitions completed in 2004.
The Dollar Thrifty Automotive Group, Inc. fourth quarter/full year 2004 earnings conference call and live audio Web cast will be held on Wednesday, February 9, 2005, at 10:00 a.m. (central time). Those interested in listening to the conference call live may access the call via Web cast at the corporate Web site, dtag.com, or by dialing 888-395-2045 (domestic) or 210-234-8004 (international). An audio replay of the conference call will be available through February 23, 2005, by calling 888-662-6658 (domestic) or 402-220-6418 (international). The ID and pass code for both the domestic and international replay is “Dollar Thrifty.” The replay will also be available via the corporate Web site for one year.
The Dollar Thrifty Automotive Group Annual Meeting of Stockholders will be held on May 20, 2005, at 11:00 a.m. (central time) at the Company’s worldwide headquarters in Tulsa.
The Company has enhanced the “Investor Information” portion of its Web site, dtag.com, by including information typically presented by management at investor meetings following the announcement of earnings. This information, which will generally be updated after each quarterly announcement, can be found under the “Investor Update” tab.
Dollar Thrifty Automotive Group, Inc. is a Fortune 1000 Company headquartered in Tulsa, Oklahoma. Driven by the mission “Value Every Time,” the Company's brands, Dollar Rent A Car and Thrifty Car Rental, serve value-conscious travelers in approximately 70 countries. Dollar and Thrifty have over 800 corporate and franchised locations in the United States and Canada including operations at most major airports. The Company's more than 8,000 employees are located mainly in North America, but global service capabilities exist through an expanding international franchise network. For additional information, visit dtag.com.
Some of the statements contained in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Dollar Thrifty Automotive Group, Inc. believes such forward-looking statements are based upon reasonable assumptions, such statements are not guarantees of future performance and certain factors could cause results to differ materially from current expectations. These factors include: price and product competition; economic and competitive conditions in markets and countries where the companies' customers reside and where the companies and their franchisees operate; natural hazards or catastrophes; incidents of terrorism; airline travel patterns; changes in capital availability or cost; costs and other terms related to the acquisition and disposition of automobiles; systems or communications failures; costs of conducting business and changes in structure or operations; and certain regulatory and environmental matters and litigation risks. Should one or more of these risks or uncertainties, among others, materialize, actual results could vary from those estimated, anticipated or projected. Dollar Thrifty Automotive Group, Inc. undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.