The Priceline Group Inc. (NASDAQ:PCLN) Q1 2015 Earnings Conference Call Transcript

May 07, 2015 • 07:30 am ET

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The Priceline Group Inc. (NASDAQ:PCLN) Q1 2015 Earnings Conference Call Transcript

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Operator
operator

Welcome to the Priceline Group's First Quarter 2015 Conference Call.

(Forward-Looking Cautionary Statements)

A copy of the Group's earnings press release, together with an accompanying financial and statistical supplement is available on the For Investors section of the Priceline Group's website, www.priceline.com. And now, I would like to introduce the Priceline Group's speakers for this afternoon, Darren Huston and Daniel Finnegan. Go ahead, gentlemen.

Executive
Darren Huston

Okay, thank you very much. And welcome to the Priceline Group's first quarter conference call. Thank you for joining us, before the markets open this morning in New York. I'm here in Amsterdam with Priceline Group's CFO, Dan Finnegan.

The Group reported consolidated gross bookings for the fourth quarter of approximately $13.8 billion, up 12% year-over-year or about 26% on a local currency basis. Room nights exceeded $100 million for the first time during the quarter while growth accelerated slightly to 25%. Non-GAAP earnings per share was $8.12, up 4% versus prior year surpassing FactSet consensus estimates of $7.72 per share and our guidance for the quarter.

Our U.S dollar denominated growth rates were substantially impacted by the stronger dollar. Our international business recorded 29% gross bookings growth on a local currency basis, up from 27% last quarter. Gross bookings benefited from growth in hotel supply at Booking.com which now has over 640,000 hotels and other accommodations in over 200 countries and territories, up 40% over last year. We are continuing to ramp new property acquisition including individually owned vacation rentals with new on-boarding tools that allow owners to list their property quickly and easily on our websites. Vacation rentals nearly doubled year-over-year to 275,000, instantly bookable and confirmable properties including villas, chalets, apartments, aparthotels and other self-catered products.

Two important innovations were also launched at Booking.com in the first quarter. Booking Now, our mobile phone app for spontaneous bookers and Booking Suite, our partner facing software services platform, both launches were executed well and early results are encouraging. Each of these growth extensions represent innovation beachhead that will be further expanded upon in the coming weeks, months and quarters.

International results also benefited from Agoda.com and Rentalcars.com, both of which accelerated in the quarter. Kayak and OpenTable continue to pursue the international opportunity; and where much work has been done and both businesses are growing, there is still a lot of potential ahead of us. Kayak is focused on product innovation and brand building and has made some solid business progress, particularly in Europe. OpenTable has now more or less completed its technical REIT platform into a more modern cloud based architecture. We are now executing plans to optimize the product and roll it out globally.

Against these plans, we will take a determined by test and learn approach over the coming quarters as we have with all our businesses. Demand for OpenTable solutions from both restaurants and customers remains very strong.

Priceline.com's domestic growth continued to be hampered by the shrinking opaque business. Priceline.com's retail business remains healthy, including acceleration in the retail hotels and