Dollar Thrifty Automotive Group Reports Third Quarter Earnings
Executive Director -
FOR IMMEDIATE RELEASE
Tulsa, Oklahoma, October 27, 2005: Dollar Thrifty Automotive Group, Inc. (NYSE:DTG) today reported results for the third quarter ended September 30, 2005. Total revenue for the 2005 third quarter was $456.7 million, an 8.5 percent increase over the 2004 third quarter. Net income for the quarter was $28.4 million, or $1.07 per diluted share. For the comparable 2004 quarter, net income was $25.0 million, or $.96 per diluted share.
For the nine months ended September 30, 2005, total revenue was $1.2 billion, an 8.6 percent increase over the comparable period in 2004. Net income for the nine months ended September 30, 2005, was $52.7 million, or $2.00 per diluted share, compared to $49.4 million, or $1.88 per diluted share, which includes the $.14 per share favorable cumulative effect of a change in accounting principle for the comparable nine months of 2004.
Third quarter vehicle rental revenue increased 10.9 percent over the 2004 third quarter to $419.1 million, driven by an 11.7 percent increase in rental days partially offset by a 0.7 percent decline in revenue per day. Same store rental days were up 4.6 percent and franchise acquisitions added another 7.1 percent to rental day growth. Vehicle leasing revenue declined from last year’s third quarter due to fewer vehicles leased to franchisees resulting primarily from franchise acquisitions, which was partially offset by higher lease rates.
“We are very pleased with our strong third quarter performance,” Gary L. Paxton, President and Chief Executive Officer, said. “We achieved strong same store rental day growth, high utilization of our vehicle fleet and did a good job of managing costs. We were very successful in growing reservations on the Internet and in particular our own branded Web sites, dollar.com and thrifty.com. We were challenged during the quarter from the damaging hurricanes which hit the Gulf Coast region and are extremely proud of our employees’ efforts to assist their customers and colleagues during and following these disasters. Hurricane-related damage to our facilities and vehicles and reduced rental volume at our New Orleans operations impacted third quarter pretax results by about $2 million.
“We were also pleased with the recent passage in August of the Highway Bill which removed unlimited vicarious liability for vehicle rental and leasing companies. We anticipate this new law will lower our annual insurance costs by $12 million to $14 million. As we previously said, we are experiencing significant cost increases for 2006 model year vehicles and we continue to implement cost saving initiatives and revenue improvement opportunities.”
During the third quarter, the Company purchased 18,800 shares under its $100 million share repurchase program at a total cost of $607,000. Since announcing the program in July 2003, the Company has purchased 1.5 million shares at a cost of $44.7 million. Repurchases in the third quarter were minimal due to the Company’s determination during the quarter that it was appropriate to temporarily suspend the repurchase program. This suspension will remain in effect until the Company determines that it is appropriate to restart the program.
The Company does not intend to comment further with respect to the reasons for the suspension, other than to assure investors that it is not the result of any accounting or regulatory issue. The Company remains committed to its share repurchase program and intends to restart the program as soon as appropriate.
“Industry rental pricing remains very competitive although we are starting to see higher rental rates at many of our locations,” Paxton said. “We are narrowing our 2005 earnings per share guidance range to $2.05 - $2.15 based on achieving full year same store rental day growth of 2.5 to 3.0 percent and revenue per day down 0.5 to 1.0 percent from last year. Our previous earnings per share guidance range was $2.00 - $2.20 based on revenue per day being flat with the prior year.”
The Dollar Thrifty Automotive Group, Inc. third quarter 2005 earnings release conference call will be held on Thursday, October 27, 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 888-390-5183 (domestic) or 630-395-0022 (international), using the pass code “Dollar Thrifty.” An audio replay of the conference call will be available through November 10, 2005, by calling 800-860-4696 (domestic) or 203-369-3836 (international). The replay will also be available via the corporate Web site for one year.
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 approximately 800 corporate and franchised locations in the United States and Canada, and they have 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; access to reservation distribution channels; 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.