Digital Booking Sites

Hotel bookings propel Orbitz first quarter profit

Excerpt from Chicago Tribune

May 09, 2013 8:49 am

Skift Take

Obitz’s much-hyped deal to power the American Express consumer travel site contributed to first quarter growth, but it looks like it isn’t turning out to be the bulldozer that Orbitz anticipated.

— Dennis Schaal

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Online travel agency Orbitz Worldwide Inc. said Thursday it turned a profit in the first quarter thanks to higher hotel room bookings and sales of its vacation packages.

The Chicago company reported a profit of $146.2 million, or $1.34 per share in the quarter that ended March 31, compared with a year-ago loss of $6.5 million, or 6 cents per share.

Revenue rose 7 percent to $202.9 million.

Orbitz said it sold 14 percent more room nights in the first quarter than it did a year ago, while hotel revenue overall jumped 27 percent. Revenue from its vacation packages, in which it bundles flights, hotel rooms and car rentals for one price, also improved, it said.

Airline ticket sales fell 4 percent, but Orbitz said that was partially offset by an improvement in sales related to its business that enhances other companies’ websites as well as higher advertising revenue.

For the second quarter, Orbitz expects revenue to rise to between $214 million and $220 million as the summer travel season begins. For the full year, Orbitz expects revenue to grow between 4 and 7 percent.

Online travel agencies like Orbitz and Expedia make their money through commissions in the flights, hotel room stays and car rentals they sell. Both have in recent years put a renewed focus on expanding their hotel selections as airlines reduced seats and began to promote customer bookings on their own websites. The vacation packages have also lured many new customers. — @SamWillTravel ___

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