Dollar Thrifty Profit Trumps Street on Rental Revenue

By Features FOXBusiness

Dollar Thrifty Automotive (DTG) reported on Tuesday a stronger-than-expected third-quarter profit on higher car rental revenue, and the company said it expects demand for its cars to continue growing in the current period.

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The company, which said it plans to continue focusing on revenue- and productivity-driving initiatives and cost controls, said it expects fourth-quarter car rental revenue to grow about 1% to 2%.

The Tulsa, Okla.-based company posted net income of $66.6 million, or $2.13 a share, compared with $49.2 million, or $1.62 a share, in the same quarter last year.

“We are pleased that the company is reporting the highest quarterly profit in its history,” Dollar Thrifty’s chief executive, Scott Thompson, said in a statement.

Excluding one-time items, the company earned $2.14 a share, which is sharply ahead of average analyst estimates polled by Thomson Reuters of $1.92 a share.

Revenue for the three months ended Sept. 30 was $451.7 million, up from $443.5 million a year ago, just beating the Street’s view of $448 million. Gains in vehicle rental revenue, mostly due to a 4.1% increase in rental days, were partially offset by a 1.7% decline in revenue per day.

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The announcement comes days after Hertz (HTZ) pulled its bid to takeover Dollar Thrifty after what was a months-long bidding war for the car renter with Avis Budget (CAR). 

Avis withdrew its bid even earlier.

Hertz said it was still interested in buying its smaller rival if antitrust regulators clear the deal – which has been the acquisition’s biggest challenge.