Dollar Thrifty Swings to 4Q Profit

Wednesday, February 9th 2005, 1:35 pm
By: News On 6

TULSA, Okla. (AP) _ Dollar Thrifty Automotive Group, owner of Dollar Rent-A-Car and Thrifty Car Rental, reported Wednesday that it swung to a fourth-quarter profit, but said it expects vehicle costs to increase in 2005.

The company earned $1.4 million, or 5 cents per share, compared with a loss of $8.5 million, or 33 cents per share, last year. The company _ which implemented new accounting methods during the 2003 quarter _ said it would have earned 11 cents per share in the year-ago period if that accounting had been in effect for prior periods.

Dollar Thrifty said latest-quarter profit was hurt by higher costs for insurance reserves and compliance with government accounting regulations.

Revenue rose 15 percent to $349.2 million from $302.9 million, driven by a 20 percent increase in vehicle rental revenue. Dollar Thrifty said rental days increased 21.7 percent, partly because of franchise acquisitions, and same-store rental days rose 8.2 percent. The company said vehicle leasing revenue declined because of a shift from franchise to corporate operations and lower lease rates.

For the year, Dollar Thrifty earned $50.8 million, or $1.94 per share, on revenue of $1.42 billion.

Looking forward, the company predicted 2005 earnings of $2 to $2.20 per share with same-store rental days growing 6 percent to 7 percent with a flat to 2 percent increase in revenue per day.

``We expect fewer opportunities for incremental low-cost fleet deals and rising interest rates to increase industry vehicle costs in 2005,'' Gary Paxton, president and chief executive, said in a news release. ``We will continue to pursue franchise acquisitions and operating efficiencies from our consolidated operating model.''