EX-99.1 2 ex-99103x31x20198xk.htm EXHIBIT 99.1 Exhibit


Exhibit 99.1
 
travellogo11062017a05.jpg
Travelzoo
590 Madison Avenue
37th Floor
New York, NY 10022

Investor Relations:
Lijun Qi
ir@travelzoo.com 


FOR IMMEDIATE RELEASE

Travelzoo Reports First Quarter 2019 Results

NEW YORK, April 25, 2019 — Travelzoo® (NASDAQ: TZOO):

•
Revenue of $30.8 million, up 3% year-over-year in constant currencies
•
Operating profit of $5.0 million, up 36% year-over-year
•
Cash flow from operations of $3.4 million
•
Earnings per share (EPS) of $0.26

Travelzoo, a global publisher of exclusive offers and experiences for members, today announced financial results for the first quarter ended March 31, 2019, with revenue of $30.8 million and operating profit of $5.0 million. In nominal terms, revenue decreased $59,000 year-over-year. In constant currencies, revenue increased by 3% year-over-year. Net income was $3.1 million, with EPS of $0.26, up from $0.20 in the prior-year period.

"Our attractive core business in North America and Europe generated an operating profit of $6.6 million, with a strong operating margin of 23%, of which $1.6 million was re-invested in our Asia Pacific business. We are committed to driving up shareholder value by implementing a successful strategy to achieve profitable growth in Asia Pacific faster," said Holger Bartel, Global CEO of Travelzoo.




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Asia Pacific
Asia Pacific business segment revenue decreased 18% year-over-year to $1.7 million. In constant currencies, revenue decreased 13% year-over-year. The operating loss in Asia Pacific for the first quarter was $1.6 million, compared to an operating loss of $1.7 million in the prior-year period.

Europe
Europe business segment revenue increased 3% year-over-year to $10.6 million. In constant currencies, revenue increased 10% year-over-year. Operating profit for the first quarter was $2.1 million, or 20% of revenue, compared to an operating profit of $2.0 million, or 19% of revenue in the prior-year period.

North America
North America business segment revenue for the first quarter was $18.6 million, unchanged from the prior-year period. In constant currencies, revenue increased 1% year-over-year. Operating profit for the first quarter was $4.5 million, or 24% of revenue, compared to an operating profit of $3.4 million, or 18% of revenue in the prior-year period.

Members
As of March 31, 2019, Travelzoo had a worldwide unduplicated number of members of 29.9 million. In Asia Pacific, unduplicated number of members was 3.6 million as of March 31, 2019, consistent with December 31, 2018. In Europe, unduplicated number of members was 8.9 million as of March 31, 2019, up 2% from December 31, 2018. In North America, unduplicated number of members was 17.5 million as of March 31, 2019, consistent with December 31, 2018.

Income Taxes
Income tax expense was $1.8 million, compared to a $1.3 million income tax expense in the prior-year period.

Asset Management
During the first quarter of 2019, Travelzoo generated $3.4 million of cash from operating activities. Accounts receivable increased by $2.7 million over the prior-year period to $15.6 million. Accounts payable increased by $1.4 million over the prior-year period to $16.2 million. Capital expenditures were $131,000, up from $65,000 in the prior-year period. As of March 31, 2019, cash and cash equivalents were $19.9 million.

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Conference Call
Travelzoo will host a conference call to discuss first quarter results today at 11:00 a.m. ET. Please visit http://ir.travelzoo.com/events-presentations to
•
download the management presentation (PDF format) to be discussed in the conference call;
•
access the webcast.

About Travelzoo
Travelzoo® provides our 28 million members insider deals and one-of-a-kind experiences personally reviewed by one of our deal experts around the globe. With more than 25 offices worldwide, we have our finger on the pulse of outstanding travel, entertainment, and lifestyle experiences. For over 15 years we have worked in partnership with more than 2,000 top travel suppliers—our long-standing relationships give Travelzoo members access to irresistible deals.

Certain statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations, prospects and intentions, markets in which we participate and other statements contained in this press release that are not historical facts. When used in this press release, the words “expect”, “predict”, “project”, “anticipate”, “believe”, “estimate”, “intend”, “plan”, “seek” and similar expressions are generally intended to identify forward-looking statements. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including changes in our plans, objectives, expectations, prospects and intentions and other factors discussed in our filings with the SEC. We cannot guarantee any future levels of activity, performance or achievements. Travelzoo undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.
Travelzoo and Top 20 are registered trademarks of Travelzoo.





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Travelzoo
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)
 
 
Three months ended
 
March 31,
 
2019
 
2018
Revenues
$
30,825

 
$
30,884

Cost of revenues
2,946

 
3,385

Gross profit
27,879

 
27,499

Operating expenses:
 
 
 
Sales and marketing
15,606

 
15,542

Product development
1,703

 
2,511

General and administrative
5,599

 
5,789

Total operating expenses
22,908

 
23,842

Income from operations

4,971

 
3,657

Other income (loss), net
(99
)
 
161

Income before income taxes
4,872

 
3,818

Income tax expense
1,752

 
1,316

Net income
$
3,120

 
$
2,502

 
 
 
 
Basic income per share
$
0.26

 
$
0.20

Diluted income per share
$
0.26

 
$
0.20

 
 
 
 
Weighted average shares:
 
 
 
Basic
11,914

 
12,462

Diluted
12,224

 
12,462



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Travelzoo
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
 
 
March 31,
2019
 
December 31,
2018
Assets
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
19,946

 
$
18,017

Accounts receivable, net
15,579

 
12,646

Income taxes receivable
—

 
389

Deposits
88

 
167

Prepaid expenses and other
1,607

 
1,947

Total current assets
37,220

 
33,166

Deposits and other
689

 
685

Deferred tax assets
1,284

 
1,645

Restricted cash
1,325

 
1,444

Investment in WeekenGO
2,483

 
2,694

Operating lease right-of-use assets
14,264

 
—

Property and equipment, net
3,604

 
3,790

Total assets
$
60,869

 
$
43,424

Liabilities and Stockholders’ Equity
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
16,180

 
$
17,129

Accrued expenses and other
9,067

 
7,853

Deferred revenue
1,199

 
1,339

Operating lease liabilities
5,508

 
—

Income tax payable
1,519

 
489

Total current liabilities
33,473

 
26,810

Long-term tax liabilities
425

 
418

Long-term operating lease liabilities
11,251

 
—

Other long-term liabilities
83

 
2,137

Total liabilities
45,232

 
29,365

Common stock
119

 
120

Additional paid-in capital
—

 
—

Accumulated other comprehensive loss
(4,303
)
 
(4,214
)
Retained earnings
19,821

 
18,153

Total stockholders’ equity
15,637

 
14,059

Total liabilities and stockholders’ equity
$
60,869

 
$
43,424



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Travelzoo
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands) 
 
Three months ended
 
March 31,
 
2019
 
2018
Cash flows from operating activities:
 
 
 
Net income
$
3,120

 
$
2,502

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
330

 
384

Deferred income tax
341

 
(110
)
Stock-based compensation
163

 
173

Loss on equity investment in WeekenGO
159

 
—

Other
77

 
(83
)
Net foreign currency effects
(21
)
 
(171
)
Changes in operating assets and liabilities:
 
 
 
Accounts receivable
(2,980
)
 
(997
)
Income tax receivable
388

 
428

Prepaid expenses and other
425

 
(10
)
Accounts payable
(1,100
)
 
(3,185
)
Accrued expenses and other
1,587

 
1,024

Income tax payable
988

 
217

Other liabilities
(71
)
 
7

Net cash provided by operating activities
3,406

 
179

Cash flows from investing activities:
 
 
 
Purchases of property and equipment
(131
)
 
(65
)
Net cash used in investing activities
(131
)
 
(65
)
Cash flows from financing activities:
 
 
 
Repurchase of common stock, net
(1,591
)
 
—

Taxes paid for net share settlement of equity awards
(26
)
 
—

Net cash used in financing activities
(1,617
)
 
—

Effect of exchange rate on cash, cash equivalents and restricted cash
152

 
456

Net increase in cash, cash equivalents and restricted cash
1,810

 
570

Cash, cash equivalents and restricted cash at beginning of period
19,461

 
24,001

Cash, cash equivalents and restricted cash at end of period
$
21,271

 
$
24,571

Supplemental disclosure of cash flow information:
 
 
 
Cash paid for income taxes, net
$
(60
)
 
$
779


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Travelzoo
Segment Information
(Unaudited)
(In thousands)
 
Three months ended March 31, 2019
Asia Pacific
 
Europe
 
North
America
 
Consolidated
Revenue from unaffiliated customers
$
1,635

 
$
11,054

 
$
18,136

 
$
30,825

Intersegment revenue
30

 
(481
)
 
451

 
—

Total net revenues
1,665

 
10,573

 
18,587

 
30,825

Operating income (loss)
$
(1,635
)
 
$
2,137

 
$
4,469

 
$
4,971

 
 
 
 
 
 
 
 
Three months ended March 31, 2018
Asia Pacific
 
Europe
 
North
America
 
Consolidated
Revenue from unaffiliated customers
$
2,042

 
$
10,332

 
$
18,510

 
$
30,884

Intersegment revenue
(20
)
 
(52
)
 
72

 
—

Total net revenues
2,022

 
10,280

 
18,582

 
30,884

Operating income (loss)
$
(1,740
)
 
$
1,966

 
$
3,431

 
$
3,657




                                                                    

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