Orbitz Reports Q4 Loss, Anticipates Lower Revenues

Orbitz Worldwide, Inc. reported its fourth quarter results, with a net loss of $18 million. Net revenue was $175 million for the fourth quarter 2009, down 3 percent (6 percent on a constant currency basis) year over year.

Domestic net revenue declined 12 percent while international net revenue increased 48 percent (24 percent on a constant currency basis). Orbitz said that loss was mainly due to its elimination of most domestic air booking fees. Higher transaction volume partially offset the decline in net revenue per transaction.

Global gross bookings increased 17 percent (15 percent on a constant currency basis) year over year. This increase was primarily due to higher transaction volume partially offset by lower air fares and lower average hotel room rates.

Air gross bookings increased 19 percent (17 percent on a constant currency basis) and non-air gross bookings increased 12 percent (8 percent on a constant currency basis) year over year. Domestic gross bookings increased 15 percent compared with the fourth quarter 2008, and international gross bookings increased 32 percent (15 percent on a constant currency basis) year over year.

For the year ended Dec. 31, 2009, net revenue was $738 million, down 15 percent (13 percent on a constant currency basis) from the same period of 2008. This net revenue decline was due primarily to the removal of most domestic air booking fees and a significant reduction in hotel net revenue due to lower average daily rates, lower hotel booking fees, lower breakage and disappointing results at HotelClub. Higher transaction volume partially offset the decline in net revenue per transaction.

The company reported a net loss of $337 million or ($4.01) per diluted share for the full year 2009, compared with a net loss of $299 million or ($3.58) per diluted share for the full year 2008. The net loss in both years was due primarily to non-cash goodwill and intangible asset impairment charges. Orbitz said it expects to see a 2 percent to 6 percent year over year decline in net revenue, for the first quarter, due to the elimination of most domestic air booking fees and significant reduction of hotel booking fees in the second quarter of 2009.