Avis Budget Group Inc. (NASDAQ: CAR) shares rose after the company posted better-than-expected earnings for its fourth quarter. The rental car company issued strong FY18 sales guidance.
The car rental giant, based out of Parsippany, New Jersey, reported that revenue growth of 7% in the fourth quarter led to a $140-million improvement compared to the prior year. This growth was driven by a 7% increase in overall rental days and higher year-over-year local currency time and mileage revenue per day.
Net income improved to $220 million, or $2.65 per diluted share, Adjusted EBITDA increased 16% to $140 million in the quarter and Adjusted net income increased to $38 million, or $0.45 per diluted share.
Said CEO Larry De Shon,“Our fourth quarter results reflect the achievement of strong global volume growth, positive pricing in the Americas and the benefits from our relentless focus on costs,”
"Looking forward, I believe we have substantial opportunities to leverage technology to both improve our customers' experience and drive efficiencies throughout our organization, and will continue to position ourselves to benefit from the evolving mobility landscape."
The Company's corporate debt was approximately $3.6 billion at the end of 2017 and cash and cash equivalents totaled $611 million, compared to $3.5 billion of corporate debt at year end 2016 and cash and cash equivalents of $490 million.
The Company’s 2018 guidance calls for revenues of $9.2 million-- $9.45 million, while Adjusted EBITDA is projected between $740 million and $820 million.
Shares in Avis Budget rocketed higher $4.71, or 14.7%, to $44.67.
