Dollar Thrifty Beats 2nd Quarter Estimates
Dollar Thrifty Automotive Group has reported better profits than expected due to lower costs. Earnings for the second quarter were US$42.3 million, compared to the US$12.4 million during the same period last year. Total revenue was marginally down at US$396.2 million, while total expenses and costs declined around 14%.
The company predicts they will have a stronger second half, with rental revenue up 4% to 5%, rather than the 2% decline in the first half. They also anticipate EBITDA to be US$200 million to US$220 million for the year, excluding merger-related expenses.
Scott Thomson, the president and chief executive of Dollar Thrifty, said that they have been seeing profitable revenue growth since May, and their reservation book is solid. They currently predict a slightly expanding travel industry and overall economy, he continued. However, they think gains from the sale of used cars will be less, he added.
Dollar Thrifty gained a lot from the sale of their used vehicles during the first half of this year while they freshened their fleet. However, most of their revenue comes from the leisure sector, which is one reason they are such a hot company to take over. They have been boasted as the last big acquisition in the industry, which has seen many consolidations in the past few years.
The budget car hire company has signed a merger agreement with Hertz Global Holdings, but Avis Budget Group topped that offer just last week. Then this week, Hertz was given antitrust approval for the merger from Canadian authorities, while Avis has also started the process of getting clearance.
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