Avis Budget Group Reports Financial Results for 2006

In a February press release, Avis Budget Group Inc. reported results for its fourth quarter and full year, which ended December 31, 2006. Full-year revenue increased to a record $5.7 billion and pretax income was a loss of $677 million due to costs related to the company’s separation into four independent companies.

For the fourth quarter, revenue was $1.3 billion, consistent with fourth quarter 2005, pretax income was an $8 million loss and, excluding separation and restructuring costs of $48 million, pretax income was $40 million. Reported results include the financial impact of the July separation of Cendant into three public entities and the subsequent sale of Travelport in late August.

The stand-alone earnings of the company's vehicle rental operations are reflected in the results of Avis Budget Car Rental LLC and its subsidiaries (ABCR), the companies that operate the vehicle rental business.

In the fourth quarter, ABCR generated EBITDA excluding separation and restructuring costs of $94 million and pretax income excluding separation and restructuring costs of $39 million. Reported pretax income for ABCR in the fourth quarter was $28 million. On both a reported and pro forma basis, fourth quarter EBITDA from car rental operations increased compared to fourth quarter 2005, while fourth quarter EBITDA from truck rental operations decreased year-over-year.

For the year ended December 31, 2006, ABCR grew revenue by 6 percent to $5.6 billion and, excluding separation and restructuring costs, had EBITDA of $403 million and pretax income of$223 million. On a pro forma basis, as if the April 2006 financings had been in place throughout 2006 and excluding separation and restructuring costs, ABCR's EBITDA was $405 million and pretax income was $172 million. ABCR's pretax income was $190 million.

Avis Budget Group Chairman and CEO Ronald L. Nelson said Avis Budget enters 2007 positioned to bring commercial pricing and fleet costs into balance, to continue to rapidly grow local rental and ancillary revenue streams, to turn around truck rental operations and to maintain technological innovation and U.S. on-airport car rental transactions.

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