Travelzoo plunges on lower Q4 profit
Travelzoo Inc. (Nasdaq: TZOO) shares are plunging after the travel website operator posted fourth-quarter net income of $0.05 million, or breakeven per share, down substantially from $4.3 million, or $0.26 per share, a year earlier. Wall Street analysts expected the New York City-based company to earn $0.14 per share.
The company’s quarterly revenue rose 8% to $19.1 million, from $17.7 million during the same period of 2006. Analyst, on average, projected Travelzoo’s fourth-quarter revenue to be $20.2 million.
CEO Ralph Bartel said in a statement that the firm was negatively impacted by losses in its foreign operations.
“Travelzoo’s latest results were impacted by non-tax deductible losses from our foreign operations in Asia Pacific and Europe,” Bartel said. “As announced frequently in our investor communications over the last twelve months, our strategy of investing in Asia Pacific and Europe affects our reported earnings. We believe that going global is an opportunity to create attractive shareholder value in the future and we want to seize this opportunity."
In morning trading, TZOO shares are plunging 22.78%, or $3.61, at $12.24. Over the last 52 weeks, shares have ranged from $11.72 to $40.68.
About the Author
Reporter Will Atkinson is based in SmallCapInvestor.com's Washington, D.C. bureau.
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