Priceline Q4 Profit Up 73 Percent

February 24, 2011

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Online travel agency Priceline on Wednesday posted a larger-than-expected quarterly profit on bookings growth and the company forecast stronger growth in the first quarter.

"If you look at the international business in particular, we've been focused on Asia," Priceline chief executive Jeffery Boyd said.

He attributed growth in international markets to increasing hotel reservations and higher room rates.

Priceline said it aimed to increase travel bookings 45 percent to 50 percent for the first quarter. The company expects revenue to grow by 29 percent to 34 percent in the first quarter.

The company said its fourth-quarter net income was USD$135.7 million, compared with USD$78.4 million a year earlier.

Priceline, which is best known for its name-your-own-price auction, said the total value of its bookings rose 44.2 percent to USD$3.26 billion.

Last month, Priceline said it reached a deal with American Airlines to use American's direct connect technology to access fares.

For now, Priceline is the only publicly traded online travel agency to list American's fares, but Boyd downplayed the potential advantage over rival agencies.

"If you look at the contribution of airline tickets to our total business, it's pretty small now," he said.

Last year, Orbitz refused to use American's direct connect link and American stopped selling its tickets on Orbitz sites.

Expedia later dropped American Airlines' tickets from its listings, charging the airline's new commercial strategy is "anti-consumer" and "anti-choice."

Direct connect also threatens to disrupt the established model that sends air fare information to travel agencies via global distribution systems.

(Reuters)