Avis Budget Group Inc. (NASDAQ: CAR) released its fourth-quarter financial results after the markets closed on Tuesday. The company had $0.18 in earnings per share (EPS) on $1.9 billion in revenue. That compares to consensus estimates of $0.18 in EPS on $1.94 billion in revenue.
During the fourth quarter, revenue increased 1% and it grew 5% in constant currency, primarily due to an 8% increase in rental days. Results benefited from increased rental volumes, lower per-unit fleet costs and aggressive cost controls, partially offset by reduced pricing and a $7 million negative impact from currency movements.
The Americas segment reported revenues of $1.36 billion, an increase of 1% primarily due to a 3% increase in volume and a 3% increase in ancillary revenue per rental day in constant currency. The international segment had revenues of $540 million, which was relatively unchanged despite a $64 million (12%) negative impact from movements in currency exchange rates compared to the prior year.
In terms of guidance for the fiscal 2016 full year, the company expects to have EPS in the range of $2.70 to $3.30 and revenues in the range of $8.70 billion to $8.85 billion. Consensus estimates call for $3.43 in EPS on $8.77 billion in revenue.
On January 1, Larry De Shon took the reigns as the company’s chief executive, succeeding Ronald Nelson, who is continuing to serve as the company’s chairman.
De Shon commented on earnings:
We had record results in 2015, successfully overcoming substantial exchange-rate headwinds and softer-than-expected growth in commercial demand. We also returned nearly $400 million of cash to stockholders this year in the form of share repurchases, reflecting the confidence we have in our long-term growth prospects. Our 2016 earnings outlook reflects incremental investments we are making in our business to enhance the customer experience we offer and expand our long-term margins.
Shares of Avis fell more than 26% to a new 52-week low of $22.05 Wednesday morning. The consensus analyst price target is $46.11 and the 52-week high is $62.23.
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