Avis Budget Group, Inc. (CAR) saw its loss widen to $31 million, or $0.35 a share for the quarter ended Dec. 31, 2016. In the previous year period, the company reported a loss of $5 million, or $0.06 a share. On the other hand, adjusted net income for the quarter stood at $13 million, or $0.15 a share compared with $18 million or $0.18 a share, a year ago.
Revenue during the quarter went down marginally by 1.21 percent to $1,879 million from $1,902 million in the previous year period. Gross margin for the quarter contracted 178 basis points over the previous year period to 74.67 percent. Total expenses were 95.26 percent of quarterly revenues, up from 93.53 percent for the same period last year. That has resulted in a contraction of 173 basis points in operating margin to 4.74 percent.
However, the adjusted EBITDA for the quarter stood at $121 million compared with $128 million in the prior year period. At the same time, adjusted EBITDA margin contracted 29 basis points in the quarter to 6.44 percent from 6.73 percent in the last year period.
"While our fourth quarter results reflect softer-than-expected volume and pricing, as well as currency movements having a $7 million adverse impact on Adjusted EBITDA compared to what we had anticipated, we are enthusiastic about our prospects for 2017 and beyond," said Larry De Shon, Avis Budget Group Chief Executive Officer. "Our strategic initiatives are already beginning to deliver meaningful benefits, and we continue to expect that our efforts will drive substantial long-term margin growth."
For financial year 2017, Avis Budget Group, Inc. projects revenue to be in the range of $8,800 million to $8,950 million. The company forecasts diluted earnings per share to be in the range of $3.05 to $3.75 on adjusted basis.
Operating cash flow improves marginally
Avis Budget Group, Inc. has generated cash of $2,629 million from operating activities during the year, up 1.74 percent or $45 million, when compared with the last year.
The company has spent $2,149 million cash to meet investing activities during the year as against cash outgo of $2,830 million in the last year.
The company has spent $438 million cash to carry out financing activities during the year as against cash inflow of $323 million in the last year period.
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