Priceline’s domestic gross bookings grew 14 percent in the first quarter due primarily to growth in retail and Opaque hotel room night gross bookings, aided by improved ADRs and the return to growth in airline ticket sales and higher airfares.

Published: 06 May 2011

Priceline’s domestic gross bookings grew 14 percent in the first quarter due primarily to growth in retail and Opaque hotel room night gross bookings, aided by improved ADRs and the return to growth in airline ticket sales and higher airfares.

Jeffery H. Boyd, Priceline president and CEO said solid growth in Opaque airline tickets helped the domestic top and bottom line as airlines use the Opaque channel as a revenue management tool while they increased fares generally.

“Ticket sales also benefited as American Airlines (AA) tickets were unavailable on Expedia and Orbitz for the quarter, but were available on Priceline,” said Boyd. He shared the same during Priceline’s Q1 2011 result earnings call (transcript on Seeking Alpha).

In January this year, American Airlines entered into an agreement with priceline.com to utilise American’s direct connect technology to access fares as well as customised travel products and services.

The company didn’t share an exact figure of the benefit to Priceline’s U.S. airline ticket business from the absence of American on the other websites.

Boyd said, “But we do think that the business benefited and we did see that in our results for the quarter.”

Priceline.com’s airline ticketing business returned to positive growth in the first quarter, with a 2.1 percent gain in ticket sales and improving growth in opaque ticket sales

Overall, Priceline reported a profit of $104.8 million, up from $53.9 million a year earlier. Revenue jumped 38 percent to $809..3 million.

Highlights

The group benefitted from strong growth in its global hotel business, particularly at Booking.com and Agoda.

Room nights booked grew by 55.8 percent and international gross bookings grew by 79 percent compared to prior year first quarter. The group’s hotel business continues to benefit from improving ADRs, a continuing shift from offline to online bookings, increased penetration of core European and North American markets and outstanding growth in new markets throughout the Asia-Pacific region and South America, said Boyd.

The group’s global rental car operations grew rental car days booked by 64.7 percent in the first as compared to the prior year.

A significant portion of this growth can be attributed to the group’s acquisition of TravelJigsaw and its international car hire operations, which continues to grow at impressive rates.