Avis Budget Group Inc. reported profits of $24 million in the second quarter, from a loss of $1.05 billion a year ago. The loss in the year-ago quarter was due to a charge related to discontinued operations.
Revenue rose 4 percent to $1.52 billion from $1.45 billion last year. Car rental revenue grew 7 percent, helped by higher volume.
"Our results underscore the continuing progress we are making on our strategic initiatives to optimize our two strong brands, continue our off-airport network expansion, and capture incremental profit opportunities. For example, through the first six months of the year, we have improved employee productivity by 5%; we have reversed the negative trend in maintenance and damage costs we were experiencing in 2006; we have furthered our off-airport expansion by opening 73 new locations with another 74 in the pipeline; and we have grown our insurance replacement revenue by 19%. To be sure, these achievements were tempered by a challenging competitive retail and commercial pricing environment despite rising fleet costs industry-wide," said Avis Budget Group Chairman and Chief Executive Officer Ronald L. Nelson.
"We continue to expect second half 2007 results to be considerably stronger than first half results," Mr. Nelson added. "This reflects continued growth in volume and rigorous expense controls, and our expectation that EBITDA excluding separation-related expenses in our Domestic Car Rental segment, by far our largest, will increase by more than 25% in the third quarter compared to third quarter 2006."