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Form 8-K Priceline Group Inc. For: May 07

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May 7, 2015 7:12 AM EDT


SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported) May 7, 2015
 
The Priceline Group Inc.
(Exact name of registrant as specified in its charter)
 
Delaware
 
0-25581
 
06-1528493
(State or other Jurisdiction of
Incorporation)
 
(Commission File Number)
 
(IRS Employer Identification No.)
 
800 Connecticut Avenue, Norwalk, Connecticut
 
06854
(Address of principal office)
 
(zip code)
 
N/A 
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o            Soliciting material pursuant to Rule 14a-12  under the Exchange Act (17 CFR 240.14a-12)
 
o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o            Pre-commencement communications pursuant to Rule 13e-4c  under the Exchange Act (17 CFR 240.13e-4(c))






Item 2.02.              Results of Operations and Financial Conditions
 
On May 7, 2015, The Priceline Group Inc. announced its financial results for the quarter ended March 31, 2015.  The press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. A copy of The Priceline Group's unaudited consolidated balance sheet at March 31, 2015, unaudited consolidated statements of operations for the three months ended March 31, 2015 and unaudited consolidated statement of cash flows for the three months ended March 31, 2015, are included in the financial and statistical supplement attached to the press release.  The unaudited consolidated balance sheet at March 31, 2015, unaudited consolidated statements of operations for the three months ended March 31, 2015 and unaudited consolidated statement of cash flows for the three months ended March 31, 2015 shall be treated as "filed" for purposes of the Securities Exchange Act of 1934, as amended, but all other information in the press release shall be treated as "furnished."

Item 9.01.           Financial Statements and Exhibits
 
(d)    Exhibits

Exhibit    Description

99.1
Press release (which includes a financial and statistical supplement and related information) issued by The Priceline Group Inc. on May 7, 2015 relating to, among other things, its first quarter 2015 earnings. The unaudited consolidated balance sheet at March 31, 2015 and unaudited consolidated statement of operations for the three months ended March 31, 2015 and unaudited consolidated statement of cash flows for the three months ended March 31, 2015 shall be treated as "filed" for the purposes of the Securities and Exchange Act of 1934, as amended, and the remaining information shall be treated as "furnished."
 







SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
THE PRICELINE GROUP INC.
 
 
 
 
 
 
By:
/s/ Peter J. Millones
 
 
Name:
Peter J. Millones
 
 
Title:
Executive Vice President, General Counsel and Secretary
 
 
Date:  May 7, 2015





EXHIBIT INDEX
 
Exhibit No.    Description

99.1
Press release (which includes a financial and statistical supplement and related information) issued by The Priceline Group Inc. on May 7, 2015 relating to, among other things, its first quarter 2015 earnings.








Exhibit 99.1
The Priceline Group Reports Financial Results for 1st Quarter 2015
NORWALK, CT – May 7, 2015. . . The Priceline Group Inc. (NASDAQ: PCLN) today reported its 1st quarter 2015 financial results. First quarter gross travel bookings for The Priceline Group (the "Group"), which refers to the total dollar value, generally inclusive of all taxes and fees, of all travel services purchased by its customers, were $13.8 billion, an increase of 12% over a year ago (approximately 26% on a constant currency basis).
The Group's gross profit for the 1st quarter was $1.7 billion, a 19% increase from the prior year (approximately 32% on a constant currency basis). International operations contributed gross profit in the 1st quarter of $1.4 billion, a 16% increase versus a year ago (approximately 30% on a constant currency basis). The Group had GAAP net income applicable to common shareholders for the 1st quarter of $333 million, or $6.36 per diluted share, which compares to $331 million or $6.25 per diluted share, in the same period a year ago.
Non-GAAP net income in the 1st quarter was $429 million, a 3% increase versus the prior year. Non-GAAP net income was $8.12 per diluted share, compared to $7.81 per diluted share a year ago. FactSet consensus for the 1st quarter 2015 was $7.72 per diluted share. Adjusted EBITDA for the 1st quarter 2015 was $532 million, an increase of 4% over a year ago. The section below entitled "Non-GAAP Financial Measures" provides definitions and information about the use of non-GAAP financial measures in this press release, and the attached financial and statistical supplement reconciles non-GAAP financial information with the Group's financial results under GAAP.
“The Priceline Group is off to a strong start in 2015 with accelerating growth in room nights and rental car days booked,” said Darren Huston, President and CEO of The Priceline Group. “Globally, our brands booked over 100 million room nights for the first time during a quarter.  International gross bookings growth accelerated to 29% on a constant currency basis in the 1st quarter.  Booking.com continues to extend its lead as the world’s largest brand for booking accommodations, with over 635,000 hotels and other accommodations on the platform, up 40% over last year.  Our rental car business grew rental car days by 18% over the 1st quarter of last year, an acceleration from 16% in the 4th quarter.”
Looking forward, Mr. Huston said: “Our brands executed well in the quarter, delivering strong performance on both the top and bottom line, while making smart and sustainable investments to support future growth.  We will continue to focus relentlessly on execution at all of our brands and earn our customers' loyalty by delivering winning experiences across desktop, tablet and mobile platforms.”
The Priceline Group said it was targeting the following for 2nd quarter 2015:
•
Year-over-year increase in total gross travel bookings of approximately 0% - 7% (an increase of approximately 15% - 22% on a constant currency basis).
•
Year-over-year increase in international gross travel bookings of approximately 0% - 7% (an increase of approximately 17% - 24% on a constant currency basis).
•
Year-over-year increase in U.S. gross travel bookings of approximately 0% - 5%.
•
Year-over-year increase in revenue of approximately 0% - 7%.
•
Year-over-year increase in gross profit of approximately 1% - 8% (an increase of approximately 17% - 24% on a constant currency basis).
•
Adjusted EBITDA of approximately $715 million to $765 million.
•
Non-GAAP net income per diluted share between $10.95 and $11.75.

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Non-GAAP guidance for the 2nd quarter 2015:
•
excludes non-cash amortization expense of intangibles,
•
excludes non-cash stock-based employee compensation expense,
•
excludes non-cash interest expense related to the amortization of debt discount and gains or losses on early debt extinguishment, if any, related to cash settled convertible debt,
•
excludes the impact, if any, of significant charges or benefits associated with judgments, rulings and/or settlements related to travel transaction tax (e.g., hotel occupancy taxes, excise taxes, sales taxes, etc.) proceedings,
•
excludes significant costs related to acquisitions,
•
excludes non-cash income tax expense and reflects the impact on income taxes of certain of the non-GAAP adjustments, and
•
includes the dilutive impact of unvested restricted stock units and performance share units because non-GAAP net income has been adjusted to exclude stock-based employee compensation.
The Priceline Group highlighted that its forecast assumes currency exchange rates of $1.12 per Euro and $1.51 per British Pound for the remainder of the quarter, which results in average exchange rates for the quarter that would be 19% weaker for the Euro and 11% weaker for the British Pound as compared to the prior year. Therefore, currency exchange rates are expected to significantly reduce the Company's growth rates expressed in U.S. dollars.
In addition to the adjustments above, adjusted EBITDA excludes depreciation and amortization expense, interest income, interest expense and income taxes and includes the impact of foreign currency transactions and other expenses.
When aggregated, the non-GAAP adjustments are expected to increase adjusted EBITDA over GAAP net income by approximately $260 million in the 2nd quarter 2015. In addition, the non-GAAP adjustments are expected to increase non-GAAP net income over GAAP net income by approximately $115 million in the 2nd quarter 2015. The Group estimates GAAP net income per diluted share between $8.85 and $9.65 for the 2nd quarter 2015.

Information About Forward-Looking Statements
This press release contains forward-looking statements. These forward-looking statements reflect the views of the Group's management regarding current expectations and projections about future events and are based on currently available information and current foreign currency exchange rates. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict; therefore, actual results may differ materially from those expressed, implied or forecasted in any such forward-looking statements. Expressions of future goals and similar expressions including, "may," "will," "should," "could," "expects," "plans," "anticipates," "intends," "believes," "estimates," "predicts," "potential," "targets," or "continue," reflecting something other than historical fact are intended to identify forward-looking statements.
The following factors, among others, could cause the Group's actual results to differ materially from those described in the forward-looking statements:
-- adverse changes in general market conditions for leisure and other travel services;
-- the effects of increased competition;
-- fluctuations in foreign exchange rates and other risks associated with doing business in multiple currencies;
-- our ability to expand successfully in international markets;
-- our online advertising efficiency;
-- any change by a major search engine in how it presents travel search results or conducts its auction for search placement in a manner that is competitively disadvantageous to us;
-- adverse changes in the Group's relationships with travel service providers;
-- systems-related failures and/or security breaches;
-- the ability to attract and retain qualified personnel; and

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-- tax, legal and regulatory risks.
For a detailed discussion of these and other factors that could cause the Group's actual results to differ materially from those described in the forward-looking statements, please refer to the Group's most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K filed with the Securities and Exchange Commission. Unless required by law, the Group undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures
Adjusted EBITDA represents GAAP net income excluding depreciation and amortization expense, interest income, interest expense and is adjusted to exclude stock-based employee compensation expense, gains and losses on early debt extinguishment, significant charges or benefits associated with judgments, rulings and/or settlements related to travel transaction tax (e.g., hotel occupancy taxes, excise taxes, sales taxes, etc.) proceedings and significant acquisition costs.
Non-GAAP gross profit, adjusted EBITDA, non-GAAP operating income, non-GAAP net income and non-GAAP net income per share are "non-GAAP financial measures," as such term is defined by the Securities and Exchange Commission, and may differ from non-GAAP financial measures used by other companies. The Group believes that non-GAAP gross profit, adjusted EBITDA, non-GAAP operating income, non-GAAP net income and non-GAAP net income per share that exclude certain non-cash or non-recurring income or expense items are useful for analysts and investors to evaluate the Group's on-going performance because they provide a useful comparison of the Group's projected cash earnings and performance with its historical results from prior periods and to those of its competitors (though competitors may calculate similar non-GAAP financial measures differently than those calculated by the Group). These non-GAAP metrics, in particular adjusted EBITDA, non-GAAP operating income, and non-GAAP net income are not intended to represent funds available for the Group's discretionary use and are not intended to represent or to be used as a substitute for operating income, net income or cash flows from operations data as measured under GAAP. The items excluded from these non-GAAP metrics, but included in the calculation of their closest GAAP equivalent, are significant components of consolidated statements of income and must be considered in performing a comprehensive assessment of overall financial performance.
Non-GAAP financial information for the three months ended March 31, 2015 and 2014 are adjusted for the following items:
•
Amortization expense of intangibles is excluded because it does not impact cash earnings.
•
Stock-based employee compensation expense is excluded because it does not impact cash earnings and is reflected in earnings per share through increased share count.
•
Interest expense related to the amortization of debt discount and gains or losses on early debt extinguishment related to convertible debt are excluded because they are non-cash in nature.
•
Significant charges or credits associated with judgments, rulings and/or settlements related to travel transaction tax (e.g., hotel occupancy taxes, excise taxes, sales taxes, etc.) proceedings, including the reversal of previously accrued travel transaction taxes (including estimated interest and penalties) of $16.4 million recorded in the 1st quarter of 2015 related to a favorable ruling in the State of Hawaii, are excluded because the amount and timing of these items are unpredictable, are not driven by core operating results and render comparisons with prior periods less meaningful. No such charges or credits were excluded in the three months ended March 31, 2014.
•
Income tax expense is adjusted for the tax impact of certain of the non-GAAP adjustments described above and to exclude tax expense recorded where no actual tax payments are owed because of available net operating loss carryforwards.
•
For calculating non-GAAP net income per share:
◦
net income is adjusted for the impact of the non-GAAP adjustments described above; and
◦
additional unvested restricted stock units and performance share units are included in the calculation of non-GAAP net income per share because non-GAAP net income has been adjusted to exclude stock-based employee compensation expense.


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The presentation of this financial information should not be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles in the United States. The attached financial and statistical supplement reconciles non-GAAP financial information with the Group's financial results under GAAP.
About The Priceline Group
The Priceline Group Inc. (NASDAQ: PCLN) is a leading provider of online travel and travel related reservation and search services, provided to consumers and local partners in over 200 countries through six primary brands: Booking.com, priceline.com, KAYAK, agoda.com, rentalcars.com and OpenTable.
For more information, visit pricelinegroup.com.

###
For Press Information: Leslie Cafferty (203) 299-8128 [email protected]
For Investor Relations: Matthew Tynan (203) 299-8487 [email protected]


4 of 10



The Priceline Group Inc.
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)

 
 
March 31,
2015
 
December 31,
2014
ASSETS
 
 

 
 

Current assets:
 
 

 
 

Cash and cash equivalents
 
$
3,255,814

 
$
3,148,651

Restricted cash
 
863

 
843

Short-term investments
 
1,379,641

 
1,142,182

Accounts receivable, net of allowance for doubtful accounts of $15,656 and $14,212, respectively
 
706,776

 
643,894

Prepaid expenses and other current assets
 
487,285

 
178,050

Deferred income taxes
 
137,102

 
153,754

Total current assets
 
5,967,481

 
5,267,374

Property and equipment, net
 
214,863

 
198,953

Intangible assets, net
 
2,282,347

 
2,334,761

Goodwill
 
3,327,784

 
3,326,474

Long-term investments
 
4,973,644

 
3,755,653

Other assets
 
76,373

 
57,348

Total assets
 
$
16,842,492

 
$
14,940,563

 
 
 
 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
 

 
 

Current liabilities:
 
 

 
 

Accounts payable
 
$
567,322

 
$
281,480

Accrued expenses and other current liabilities
 
610,764

 
600,758

Deferred merchant bookings
 
525,148

 
460,558

Convertible debt
 
—

 
37,195

Total current liabilities
 
1,703,234

 
1,379,991

Deferred income taxes
 
1,072,038

 
1,040,260

Other long-term liabilities
 
132,987

 
103,533

Long-term debt
 
5,304,108

 
3,849,756

Total liabilities
 
8,212,367

 
6,373,540

 
 
 
 
 
Convertible debt
 
—

 
329

 
 
 
 
 
Stockholders' equity:
 
 

 
 

Common stock, $0.008 par value; authorized 1,000,000,000 shares, 61,974,020 and 61,821,097 shares issued, respectively
 
481

 
480

Treasury stock, 10,139,421 and 9,888,024 shares, respectively
 
(3,046,203
)
 
(2,737,585
)
Additional paid-in capital
 
4,926,560

 
4,923,196

Accumulated earnings
 
6,973,832

 
6,640,505

Accumulated other comprehensive loss
 
(224,545
)
 
(259,902
)
Total stockholders' equity
 
8,630,125

 
8,566,694

Total liabilities and stockholders' equity
 
$
16,842,492

 
$
14,940,563





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The Priceline Group Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)

 
 
Three Months Ended
March 31,
 
 
2015
 
2014
Agency revenues
 
$
1,199,348

 
$
1,041,144

Merchant revenues
 
494,675

 
526,998

Advertising and other revenues
 
146,671

 
73,660

Total revenues
 
1,840,694

 
1,641,802

Cost of revenues
 
168,458

 
235,331

Gross profit
 
1,672,236

 
1,406,471

Operating expenses:
 
 

 
 

Advertising — Online
 
643,216

 
520,848

Advertising — Offline
 
63,582

 
53,474

Sales and marketing
 
81,944

 
64,311

Personnel, including stock-based compensation of $54,008 and $38,803, respectively
 
258,984

 
194,531

General and administrative
 
100,178

 
72,981

Information technology
 
25,361

 
23,224

Depreciation and amortization
 
65,002

 
38,376

Total operating expenses
 
1,238,267

 
967,745

Operating income
 
433,969

 
438,726

Other income (expense):
 
 

 
 

Interest income
 
11,596

 
1,041

Interest expense
 
(33,479
)
 
(17,745
)
Foreign currency transactions and other
 
(4,843
)
 
(5,969
)
Total other income (expense)
 
(26,726
)
 
(22,673
)
Earnings before income taxes
 
407,243

 
416,053

Income tax expense
 
73,916

 
84,835

Net income
 
$
333,327

 
$
331,218

Net income applicable to common stockholders per basic common share
 
$
6.42

 
$
6.35

Weighted-average number of basic common shares outstanding
 
51,909

 
52,153

Net income applicable to common stockholders per diluted common share
 
$
6.36

 
$
6.25

Weighted-average number of diluted common shares outstanding
 
52,406

 
53,018




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The Priceline Group Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
 
 
Three Months Ended
March 31,
 
 
2015
 
2014
OPERATING ACTIVITIES:
 
 

 
 

Net income
 
$
333,327

 
$
331,218

Adjustments to reconcile net income to net cash provided by operating activities:
 
 

 
 

Depreciation
 
21,674

 
15,552

Amortization
 
43,328

 
22,824

Provision for uncollectible accounts, net
 
9,021

 
3,671

Deferred income taxes
 
(35,172
)
 
8,828

Stock-based compensation expense and other stock-based payments
 
54,533

 
39,412

Amortization of debt issuance costs
 
1,543

 
1,346

Amortization of debt discount
 
16,691

 
12,412

Loss on early extinguishment of debt
 
3

 
3,396

Changes in assets and liabilities:
 
 

 
 

Accounts receivable
 
(120,593
)
 
(94,156
)
Prepaid expenses and other current assets
 
(292,668
)
 
(317,812
)
Accounts payable, accrued expenses and other current liabilities
 
201,215

 
147,608

Other
 
(23,919
)
 
2,705

Net cash provided by operating activities
 
208,983

 
177,004

INVESTING ACTIVITIES:
 
 
 
 
Purchase of investments
 
(1,969,292
)
 
(2,612,047
)
Proceeds from sale of investments
 
880,774

 
2,652,013

Additions to property and equipment
 
(31,263
)
 
(29,731
)
Acquisitions and other investments, net of cash acquired
 
(26,162
)
 
(2,633
)
Proceeds from foreign currency contracts
 
453,818

 
—

Payments on foreign currency contracts
 
(448,640
)
 
(43,380
)
Change in restricted cash
 
(55
)
 
(5,077
)
Net cash used in investing activities
 
(1,140,820
)
 
(40,855
)
FINANCING ACTIVITIES:
 
 
 
 
Proceeds from the issuance of long-term debt
 
1,619,951

 
—

Payment of debt issuance costs
 
(8,064
)
 
—

Payments related to conversion of senior notes
 
(147,629
)
 
(58,449
)
Repurchase of common stock
 
(308,618
)
 
(96,660
)
Proceeds from exercise of stock options
 
9,070

 
7,693

Excess tax benefits on stock-based compensation
 
49,538

 
5,499

Net cash provided by (used in) financing activities
 
1,214,248

 
(141,917
)
Effect of exchange rate changes on cash and cash equivalents
 
(175,248
)
 
3,924

Net increase (decrease) in cash and cash equivalents
 
107,163

 
(1,844
)
Cash and cash equivalents, beginning of period
 
3,148,651

 
1,289,994

Cash and cash equivalents, end of period
 
$
3,255,814

 
$
1,288,150

SUPPLEMENTAL CASH FLOW INFORMATION:
 
 
 
 
Cash paid during the period for income taxes
 
$
379,603

 
$
367,160

Cash paid during the period for interest
 
$
10,841

 
$
5,821

Non-cash investing activity for contingent consideration
 
$
9,170

 
$
—


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The Priceline Group Inc.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands, except per share data)

RECONCILIATION OF GAAP GROSS PROFIT TO NON-GAAP GROSS PROFIT
 
Three Months Ended
March 31,
 
 
 
2015
 
2014
 
 
 
 
 
 
 
GAAP Gross profit
 
$
1,672,236

 
$
1,406,471

 
 
 
 
 
 
(a)
Adjustment to exclude favorable impact of travel transaction tax judgments, rulings and settlements
 
(16,404
)
 
—

 
 
 
 
 
 
 
Non-GAAP Gross profit
 
$
1,655,832

 
$
1,406,471

 
 
 
 
 
 
RECONCILIATION OF GAAP OPERATING INCOME TO NON-GAAP OPERATING INCOME
 
Three Months Ended
March 31,
 
 
2015
 
2014
 
 
 
 
 
 
 
GAAP Operating income
 
$
433,969

 
$
438,726

 
 
 
 
 
 
(a)
Adjustment to exclude favorable impact of travel transaction tax judgments, rulings and settlements
 
(16,404
)
 
—

(b)
Stock-based employee compensation
 
54,008

 
38,803

(c)
Amortization of intangible assets
 
43,328

 
22,824

 
 
 
 
 
 
 
Non-GAAP Operating income
 
$
514,901

 
$
500,353

 
 
 
 
 
 
 
Non-GAAP Operating income as a % of Non-GAAP Gross profit
 
31.1
%
 
35.6
%
 
 
 
 
 
 
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA
 
Three Months Ended
March 31,
 
 
2015
 
2014
 
 
 
 
 
 
 
GAAP Net income applicable to common stockholders
 
$
333,327

 
$
331,218

 
 
 
 
 
 
(a)
Adjustment to exclude favorable impact of travel transaction tax judgments, rulings and settlements
 
(16,404
)
 
—

(b)
Stock-based employee compensation
 
54,008

 
38,803

(d)
Depreciation and amortization
 
65,002

 
38,376

(e)
Interest income
 
(11,596
)
 
(1,041
)
(e)
Interest expense
 
33,479

 
17,745

(f)
Loss on early extinguishment of debt
 
3

 
3,396

(g)
Income tax expense
 
73,916

 
84,835

 
 
 
 
 
 
 
Adjusted EBITDA
 
$
531,735

 
$
513,332

 
 
 


 



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The Priceline Group Inc.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands, except per share data)

RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME
 
Three Months Ended
March 31,
 
 
2015
 
2014
 
 
 
 
 
 
 
GAAP Net income applicable to common stockholders
 
$
333,327

 
$
331,218

 
 
 
 
 
 
(a)
Adjustment to exclude favorable impact of travel transaction tax judgments, rulings and settlements
 
(16,404
)
 
—

(b)
Stock-based employee compensation
 
54,008

 
38,803

(c)
Amortization of intangible assets
 
43,328

 
22,824

(f)
Debt discount amortization related to convertible debt
 
15,775

 
11,758

(f)
Loss on early extinguishment of debt
 
3

 
3,396

(h)
Adjustments for the tax impact of certain of the Non-GAAP adjustments and to exclude non-cash income taxes
 
(1,510
)
 
8,479

 
Non-GAAP Net income applicable to common stockholders
 
$
428,527

 
$
416,478

 
 
 
 
 
 
RECONCILIATION OF GAAP TO NON-GAAP NET INCOME PER DILUTED COMMON SHARE
 
Three Months Ended
March 31,
 
 
2015
 
2014
 
 
 
 
 
 
 
GAAP weighted-average number of diluted common shares outstanding
 
52,406

 
53,018

(i)
Adjustment for unvested restricted stock units and performance share units
 
388

 
307

 
Non-GAAP weighted-average number of diluted common shares outstanding
 
52,794

 
53,325

 
Net income applicable to common stockholders per diluted common share
 
 
 
 
 
GAAP
 
$
6.36

 
$
6.25

 
Non-GAAP
 
$
8.12

 
$
7.81

 
 
 (a)
Adjustment for travel transaction taxes (including estimated interest and penalties), related to a favorable ruling in the State of Hawaii is recorded in Cost of revenues.
 (b)
Stock-based employee compensation is recorded in Personnel expense.
 (c)
Amortization of intangible assets is recorded in Depreciation and amortization.
 (d)
Depreciation and amortization are excluded from Net income to calculate Adjusted EBITDA.
 (e)
Interest income and Interest expense are excluded from Net income to calculate Adjusted EBITDA.
 (f)
Non-cash interest expense related to the amortization of debt discount and loss on early debt extinguishment are recorded in Interest expense and Foreign currency transactions and other, respectively.
 (g)
Income tax expense is excluded from Net income to calculate Adjusted EBITDA.
 (h)
Adjustments for the tax impact of certain of the non-GAAP adjustments and to exclude non-cash income taxes.
(i)
Additional shares related to unvested restricted stock units and performance share units are included in the calculation of non-GAAP net income per share because non-GAAP net income has been adjusted to exclude stock-based compensation expense.
 
 
 
For a more detailed discussion of the adjustments described above, please see the section in our press release entitled "Non-GAAP Financial Measures" which provides a definition and information about the use of non-GAAP financial measures.

9 of 10


The Priceline Group Inc.
Statistical Data
In millions
(Unaudited)
Gross Bookings
 
1Q13
 
2Q13
 
3Q13
 
4Q13
 
1Q14
 
2Q14
 
3Q14
 
4Q14
 
1Q15
International
 
$
7,783

 
$
8,579

 
$
9,179

 
$
7,758

 
$
10,643

 
$
11,682

 
$
12,080

 
$
9,233

 
$
12,104

U.S.
 
1,370

 
1,538

 
1,586

 
1,379

 
1,637

 
1,856

 
1,743

 
1,426

 
1,672

Total
 
$
9,153

 
$
10,118

 
$
10,765

 
$
9,138

 
$
12,280

 
$
13,538

 
$
13,823

 
$
10,659

 
$
13,775

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency
 
$
7,648

 
$
8,425

 
$
9,023

 
$
7,576

 
$
10,516

 
$
11,581

 
$
11,821

 
$
8,974

 
$
11,908

Merchant
 
1,505

 
1,692

 
1,742

 
1,562

 
1,764

 
1,957

 
2,002

 
1,685

 
1,867

Total
 
$
9,153

 
$
10,118

 
$
10,765

 
$
9,138

 
$
12,280

 
$
13,538

 
$
13,823

 
$
10,659

 
$
13,775

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Year/Year Growth
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
International
 
42.8
%
 
44.1
%
 
41.8
%
 
41.2
%
 
36.8
%
 
36.2
%
 
31.6
%
 
19.0
 %
 
13.7
 %
excluding F/X impact
 
43
%
 
44
%
 
41
%
 
42
%
 
38
%
 
35
%
 
32
%
 
27
 %
 
29
 %
U.S.
 
8.7
%
 
11.7
%
 
16.7
%
 
26.5
%
 
19.5
%
 
20.6
%
 
9.9
%
 
3.4
 %
 
2.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency
 
38.3
%
 
39.7
%
 
40.5
%
 
42.9
%
 
37.5
%
 
37.4
%
 
31.0
%
 
18.5
 %
 
13.2
 %
Merchant
 
27.1
%
 
30.3
%
 
23.7
%
 
21.8
%
 
17.2
%
 
15.7
%
 
15.0
%
 
7.9
 %
 
5.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
36.4
%
 
38.0
%
 
37.5
%
 
38.8
%
 
34.2
%
 
33.8
%
 
28.4
%
 
16.7
 %
 
12.2
 %
excluding F/X impact
 
37
%
 
38
%
 
36
%
 
39
%
 
35
%
 
32
%
 
29
%
 
23
 %
 
26
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Units Sold
 
1Q13
 
2Q13
 
3Q13
 
4Q13
 
1Q14
 
2Q14
 
3Q14
 
4Q14
 
1Q15
Hotel Room-Nights
 
63.2

 
69.4

 
74.8

 
63.1

 
83.4

 
89.6

 
94.8

 
78.2

 
104.6

Year/Year Growth
 
37.7
%
 
38.2
%
 
35.6
%
 
36.5
%
 
32.0
%
 
29.2
%
 
26.7
%
 
24.0
 %
 
25.4
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Rental Car Days
 
9.9

 
12.5

 
12.0

 
9.5

 
12.3

 
14.3

 
14.2

 
11.0

 
14.6

Year/Year Growth
 
43.3
%
 
46.3
%
 
27.5
%
 
32.3
%
 
24.6
%
 
14.4
%
 
18.1
%
 
16.1
 %
 
18.0
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Airline Tickets
 
1.7

 
1.7

 
1.8

 
1.8

 
2.0

 
2.1

 
2.0

 
1.7

 
2.0

Year/Year Growth
 
1.4
%
 
1.8
%
 
8.6
%
 
28.1
%
 
22.6
%
 
22.3
%
 
8.0
%
 
(4.0
)%
 
(3.2
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1Q13
 
2Q13
 
3Q13
 
4Q13
 
1Q14
 
2Q14
 
3Q14
 
4Q14
 
1Q15
Revenue
 
$
1,302.0

 
$
1,680.2

 
$
2,269.9

 
$
1,541.2

 
$
1,641.8

 
$
2,123.6

 
$
2,836.5

 
$
1,840.1

 
$
1,840.7

Year/Year Growth
 
25.5
%
 
26.6
%
 
33.0
%
 
29.4
%
 
26.1
%
 
26.4
%
 
25.0
%
 
19.4
 %
 
12.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross Profit
 
$
1,009.7

 
$
1,383.9

 
$
1,989.1

 
$
1,333.3

 
$
1,406.5

 
$
1,883.0

 
$
2,620.0

 
$
1,674.7

 
$
1,672.2

Year/Year Growth
 
35.8
%
 
37.8
%
 
42.4
%
 
41.9
%
 
39.3
%
 
36.1
%
 
31.7
%
 
25.6
 %
 
18.9
 %

Amounts may not total due to rounding.

Gross bookings is an operating and statistical metric that captures the total dollar value, generally inclusive of taxes and fees, of all travel services booked by our customers. International gross bookings consist of the gross bookings of Booking.com, agoda.com and rentalcars.com, in each case regardless of where the consumer is resident, from where the consumer makes a reservation or where the travel service is provided.

10 of 10

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