Delaware | 1-36691 | 06-1528493 | ||
(State or other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
800 Connecticut Avenue, Norwalk, Connecticut | 06854 | |
(Address of principal offices) | (Zip Code) |
Title of Each Class: | Trading Symbol | Name of Each Exchange on which Registered: | ||
Common Stock, par value $0.008 per share | BKNG | The NASDAQ Global Select Market | ||
0.800% Senior Notes Due 2022 | BKNG 22A | New York Stock Exchange | ||
2.150% Senior Notes Due 2022 | BKNG 22 | New York Stock Exchange | ||
2.375% Senior Notes Due 2024 | BKNG 24 | New York Stock Exchange | ||
1.800% Senior Notes Due 2027 | BKNG 27 | New York Stock Exchange |
Exhibit Number | Description |
Press release (which includes a financial and statistical supplement and related information) issued by Booking Holdings on May 9, 2019 relating to, among other things, its first quarter 2019 earnings. The unaudited consolidated balance sheet at March 31, 2019 and unaudited consolidated statement of operations for the three months ended March 31, 2019 and unaudited consolidated statement of cash flows for the three months ended March 31, 2019 shall be treated as "filed" for purposes of the Securities and Exchange Act of 1934, as amended, and the remaining information shall be treated as "furnished." |
BOOKING HOLDINGS INC. | |||
By: | /s/ Peter J. Millones | ||
Name: | Peter J. Millones | ||
Title: | Executive Vice President and General Counsel |
Exhibit Number | Description |
Press release (which includes a financial and statistical supplement and related information) issued by Booking Holdings Inc. on May 9, 2019 relating to, among other things, its first quarter 2019 earnings. |
Guidance Ranges | ||||||||
(U.S. Dollars in millions, except per share amounts) | Low | High | ||||||
Metrics | ||||||||
Year over year growth - Room nights booked | 6 | % | 8 | % | ||||
Year over year growth - Total gross travel bookings | (1 | )% | 1 | % | ||||
Year over year growth - Total gross travel bookings (constant currency) | 4 | % | 6 | % | ||||
GAAP | ||||||||
Year over year growth - Revenue | 5 | % | 7 | % | ||||
Net income (1)(3) | $ | 920 | $ | 940 | ||||
Net income per diluted share (2)(3) | $ | 21.10 | $ | 21.55 | ||||
Non-GAAP | ||||||||
Year over year growth - Revenue | 5 | % | 7 | % | ||||
Year over year growth - Revenue (constant currency) | 10 | % | 12 | % | ||||
Non-GAAP Net income (1) | $ | 965 | $ | 985 | ||||
Non-GAAP Net income per diluted share (2) | $ | 22.15 | $ | 22.60 | ||||
Adjusted EBITDA | $ | 1,295 | $ | 1,325 | ||||
(1) Assumes an estimated effective tax rate for the 2nd quarter of 2019 of approximately 19%. | ||||||||
(2) Assumes a fully diluted share count of approximately 43.6 million shares. | ||||||||
(3) Guidance for the 2nd quarter of 2019 for GAAP net income and net income per diluted share excludes the impact of unrealized gains and losses on marketable equity securities and foreign currency transaction gains or losses on our Euro-denominated debt that is not designated as hedging instruments for accounting purposes, both of which are not predictable. |
• | excludes an immaterial adjustment to merchant revenues related to prior periods due to a correction in the timing of revenue recognition on a component of merchant revenue, |
• | excludes the impact, if any, of significant charges or benefits associated with judgments, rulings, settlements and/or certain adjustments related to prior periods arising from travel transaction tax (e.g., hotel occupancy taxes, excise taxes, sales taxes, etc.) proceedings or other litigation or obligations, |
• | excludes the impact of significant loyalty program adjustments, such as the favorable $27 million adjustment to total revenues in the 1st quarter of 2018 related to changes introduced in that same quarter to OpenTable’s loyalty program, |
• | excludes amortization expense of intangible assets, |
• | excludes the impact, if any, of significant charges related to the impairment of goodwill or intangible assets, |
• | excludes non-cash interest expense related to the amortization of debt discount and gains or losses on |
• | excludes the impact, if any, of significant gains or losses on the sale of cost-method investments and |
• | excludes unrealized gains and losses on marketable equity securities, which are recognized in |
• | excludes the income tax impact related to the one-time deemed repatriation liability and remeasurement of deferred tax assets and liabilities as a result of the U.S. Tax Cuts and Jobs Act enacted in December 2017, if any, and |
• | the income tax impact of the non-GAAP adjustments mentioned above. |
Booking Holdings Inc. UNAUDITED CONSOLIDATED BALANCE SHEETS (In millions, except share and per share data) | ||||||||
March 31, 2019 | December 31, 2018 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 2,334 | $ | 2,624 | ||||
Short-term investments in marketable securities | 1,981 | 3,660 | ||||||
Accounts receivable, net of allowance for doubtful accounts of $61 at each date | 1,491 | 1,523 | ||||||
Prepaid expenses and other current assets | 1,271 | 600 | ||||||
Total current assets | 7,077 | 8,407 | ||||||
Property and equipment, net | 695 | 656 | ||||||
Operating lease assets | 635 | — | ||||||
Intangible assets, net | 2,078 | 2,125 | ||||||
Goodwill | 2,907 | 2,910 | ||||||
Long-term investments | 8,445 | 8,408 | ||||||
Other assets | 529 | 181 | ||||||
Total assets | $ | 22,366 | $ | 22,687 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 934 | $ | 1,134 | ||||
Accrued expenses and other current liabilities | 1,877 | 1,399 | ||||||
Deferred merchant bookings | 1,797 | 1,022 | ||||||
Convertible debt | 968 | — | ||||||
Total current liabilities | 5,576 | 3,555 | ||||||
Deferred income taxes | 513 | 370 | ||||||
Operating lease liabilities | 488 | — | ||||||
Long-term U.S. transition tax liability | 1,166 | 1,166 | ||||||
Other long-term liabilities | 89 | 162 | ||||||
Long-term debt | 7,619 | 8,649 | ||||||
Total liabilities | 15,451 | 13,902 | ||||||
Commitments and Contingencies | ||||||||
Stockholders' equity: | ||||||||
Common stock, $0.008 par value; authorized 1,000,000,000 shares, 63,121,930 and 62,948,762 shares issued, respectively | — | — | ||||||
Treasury stock, 18,935,914 and 17,317,126 shares, respectively | (17,567 | ) | (14,711 | ) | ||||
Additional paid-in capital | 5,519 | 5,445 | ||||||
Retained earnings | 19,132 | 18,367 | ||||||
Accumulated other comprehensive loss | (169 | ) | (316 | ) | ||||
Total stockholders' equity | 6,915 | 8,785 | ||||||
Total liabilities and stockholders' equity | $ | 22,366 | $ | 22,687 |
Booking Holdings Inc. UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except share and per share data) | ||||||||
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
Agency revenues | $ | 1,949 | $ | 2,113 | ||||
Merchant revenues | 603 | 526 | ||||||
Advertising and other revenues | 285 | 289 | ||||||
Total revenues | 2,837 | 2,928 | ||||||
Operating expenses: | ||||||||
Performance marketing | 1,030 | 1,106 | ||||||
Brand marketing | 163 | 101 | ||||||
Sales and other expenses | 215 | 166 | ||||||
Personnel, including stock-based compensation of $74 and $71, respectively | 501 | 499 | ||||||
General and administrative | 191 | 163 | ||||||
Information technology | 65 | 60 | ||||||
Depreciation and amortization | 116 | 103 | ||||||
Total operating expenses | 2,281 | 2,198 | ||||||
Operating income | 556 | 730 | ||||||
Other income (expense): | ||||||||
Interest income | 35 | 47 | ||||||
Interest expense | (66 | ) | (70 | ) | ||||
Net unrealized gains on marketable equity securities | 451 | 55 | ||||||
Foreign currency transactions and other | (8 | ) | (9 | ) | ||||
Total other income | 412 | 23 | ||||||
Earnings before income taxes | 968 | 753 | ||||||
Income tax expense | 203 | 146 | ||||||
Net income | $ | 765 | $ | 607 | ||||
Net income applicable to common stockholders per basic common share | $ | 17.01 | $ | 12.56 | ||||
Weighted-average number of basic common shares outstanding (in 000's) | 45,007 | 48,349 | ||||||
Net income applicable to common stockholders per diluted common share | $ | 16.85 | $ | 12.34 | ||||
Weighted-average number of diluted common shares outstanding (in 000's) | 45,436 | 49,205 |
Booking Holdings Inc. UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) | ||||||||
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
OPERATING ACTIVITIES: | ||||||||
Net income | $ | 765 | $ | 607 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 116 | 103 | ||||||
Provision for uncollectible accounts | 40 | 29 | ||||||
Deferred income tax expense | 89 | 9 | ||||||
Net unrealized gains on marketable equity securities | (451 | ) | (55 | ) | ||||
Stock-based compensation expense and other stock-based payments | 78 | 71 | ||||||
Operating lease amortization | 42 | — | ||||||
Amortization of debt discount and debt issuance costs | 14 | 17 | ||||||
Contingent consideration fair value adjustment | 7 | — | ||||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | (24 | ) | (96 | ) | ||||
Prepaid expenses and other current assets | (669 | ) | (709 | ) | ||||
Accounts payable, accrued expenses and other current liabilities | 561 | 632 | ||||||
Other long-term assets and liabilities | (418 | ) | 32 | |||||
Net cash provided by operating activities | 150 | 640 | ||||||
INVESTING ACTIVITIES: | ||||||||
Purchase of investments | (445 | ) | (714 | ) | ||||
Proceeds from sale and maturity of investments | 2,665 | 2,481 | ||||||
Additions to property and equipment | (111 | ) | (131 | ) | ||||
Net cash provided by investing activities | 2,109 | 1,636 | ||||||
FINANCING ACTIVITIES: | ||||||||
Proceeds from revolving credit facility | 250 | — | ||||||
Repayments of short-term borrowings | (25 | ) | — | |||||
Payments for conversion of senior notes | — | (1,487 | ) | |||||
Payments for repurchase of common stock | (2,773 | ) | (718 | ) | ||||
Net cash used in financing activities | (2,548 | ) | (2,205 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents | (2 | ) | 11 | |||||
Net (decrease) increase in cash and cash equivalents and restricted cash and cash equivalents | (291 | ) | 82 | |||||
Total cash and cash equivalents and restricted cash and cash equivalents, beginning of period | 2,645 | 2,563 | ||||||
Total cash and cash equivalents and restricted cash and cash equivalents, end of period | $ | 2,354 | $ | 2,645 | ||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||
Cash paid during the period for income taxes | $ | 816 | $ | 784 | ||||
Cash paid during the period for interest | $ | 68 | $ | 74 |
RECONCILIATION OF TOTAL REVENUES TO NON-GAAP TOTAL REVENUES | Three Months Ended March 31, | ||||||||
2019 | 2018 | ||||||||
Total Revenues | $ | 2,837 | $ | 2,928 | |||||
(a) | Correction to merchant revenue | 53 | — | ||||||
(b) | Adjustment to loyalty program liability | — | (27 | ) | |||||
Non-GAAP Total Revenues | $ | 2,890 | $ | 2,901 |
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA | Three Months Ended March 31, | ||||||||
2019 | 2018 | ||||||||
Net income | $ | 765 | $ | 607 | |||||
(a) | Correction to merchant revenue | 53 | — | ||||||
(b) | Adjustment to loyalty program liability | — | (27 | ) | |||||
(c) | Depreciation and amortization | 116 | 103 | ||||||
(c) | Interest income | (35 | ) | (47 | ) | ||||
(c) | Interest expense | 66 | 70 | ||||||
(d) | Unrealized gains on marketable equity securities | (451 | ) | (55 | ) | ||||
(c) | Income tax expense | 203 | 146 | ||||||
Adjusted EBITDA | $ | 718 | $ | 798 | |||||
Adjusted EBITDA as a % of Non-GAAP Total Revenues | 24.9 | % | 27.5 | % |
RECONCILIATION OF NET INCOME TO NON-GAAP NET INCOME AND NON-GAAP NET INCOME PER DILUTED COMMON SHARE | Three Months Ended March 31, | ||||||||
2019 | 2018 | ||||||||
Net income | $ | 765 | $ | 607 | |||||
(a) | Correction to merchant revenue | 53 | — | ||||||
(b) | Adjustment to loyalty program liability | — | (27 | ) | |||||
(d) | Net unrealized gains on marketable equity securities | (451 | ) | (55 | ) | ||||
(e) | Amortization of intangible assets | 45 | 47 | ||||||
(f) | Debt discount amortization related to convertible debt | 11 | 14 | ||||||
(g) | Tax impact of Non-GAAP adjustments | 85 | 4 | ||||||
Non-GAAP Net income | $ | 508 | $ | 590 | |||||
GAAP weighted-average number of diluted common shares outstanding (in 000's) | 45,436 | 49,205 | |||||||
Non-GAAP Net income per diluted common share | $ | 11.17 | $ | 12.00 |
RECONCILIATION OF CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW | Three Months Ended March 31, | ||||||||
2019 | 2018 | ||||||||
Net cash provided by operating activities | $ | 150 | $ | 640 | |||||
(h) | Additions to property and equipment | (111 | ) | (131 | ) | ||||
Free cash flow | $ | 39 | $ | 508 | |||||
Free cash flow as a % of Non-GAAP Total Revenues | 1.4 | % | 17.5 | % |
Notes: | |
(a) | An immaterial adjustment to merchant revenues related to prior periods due to a correction in the timing of revenue recognition on a component of merchant revenue. |
(b) | Favorable adjustment to OpenTable's loyalty program liability related to changes introduced in the 1st quarter of 2018 to the program. |
(c) | Amounts are excluded from Net income to calculate Adjusted EBITDA. |
(d) | Net unrealized gains or losses on marketable equity securities are excluded from Net income to calculate Non-GAAP Net income and Adjusted EBITDA. |
(e) | Amortization of intangible assets is recorded in Depreciation and amortization expense and excluded from Net income to calculate Non-GAAP Net income. |
(f) | Non-cash interest expense related to the amortization of debt discount is recorded in Interest expense and Foreign currency transactions and other, respectively. Non-cash interest expense is excluded from Net income to calculate Non-GAAP Net income. |
(g) | Reflects the tax impact of Non-GAAP adjustments and is excluded from Net income to calculate Non-GAAP Net income. |
(h) | Additions to property and equipment are included in the calculation of Free cash flow. |
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. |
Gross Bookings(2) | 1Q17 | 2Q17 | 3Q17 | 4Q17 | 1Q18 | 2Q18 | 3Q18 | 4Q18 | 1Q19 | |||||||||||||||||||||||||||
Agency | $ | 18,140 | $ | 17,947 | $ | 18,594 | $ | 15,015 | $ | 20,576 | $ | 19,090 | $ | 19,024 | $ | 15,230 | $ | 19,678 | ||||||||||||||||||
Merchant | 2,546 | 2,850 | 3,168 | 2,965 | 4,434 | 4,807 | 5,250 | 4,322 | 5,732 | |||||||||||||||||||||||||||
Total | $ | 20,687 | $ | 20,797 | $ | 21,762 | $ | 17,980 | $ | 25,009 | $ | 23,896 | $ | 24,274 | $ | 19,552 | $ | 25,410 | ||||||||||||||||||
Year/Year Growth | ||||||||||||||||||||||||||||||||||||
Agency | 24.8 | % | 16.8 | % | 18.0 | % | 15.7 | % | 13.4 | % | 6.4 | % | 2.3 | % | 1.4 | % | (4.4 | )% | ||||||||||||||||||
Merchant | 20.2 | % | 14.3 | % | 17.2 | % | 39.0 | % | 74.1 | % | 68.6 | % | 65.7 | % | 45.8 | % | 29.3 | % | ||||||||||||||||||
Total | 24.2 | % | 16.4 | % | 17.9 | % | 19.0 | % | 20.9 | % | 14.9 | % | 11.5 | % | 8.7 | % | 1.6 | % | ||||||||||||||||||
Constant Currency | 27 | % | 19 | % | 16 | % | 14 | % | 12 | % | 11 | % | 14 | % | 13 | % | 8 | % | ||||||||||||||||||
Units Sold | 1Q17 | 2Q17 | 3Q17 | 4Q17 | 1Q18 | 2Q18 | 3Q18 | 4Q18 | 1Q19 | |||||||||||||||||||||||||||
Room Nights | 174 | 170 | 178 | 152 | 197 | 191 | 201 | 171 | 217 | |||||||||||||||||||||||||||
Year/Year Growth | 27.4 | % | 21.0 | % | 18.6 | % | 16.8 | % | 13.2 | % | 12.0 | % | 13.4 | % | 13.0 | % | 10.3 | % | ||||||||||||||||||
Rental Car Days | 19 | 21 | 19 | 15 | 19 | 21 | 19 | 15 | 18 | |||||||||||||||||||||||||||
Year/Year Growth/(Decline) | 15.4 | % | 11.7 | % | 5.5 | % | 5.4 | % | 0.6 | % | 1.0 | % | (0.1 | )% | (0.6 | )% | (1.3 | )% | ||||||||||||||||||
Airline Tickets | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | |||||||||||||||||||||||||||
Year/Year Growth/(Decline) | (2.1 | )% | (8.7 | )% | (11.8 | )% | 3.1 | % | 1.9 | % | 5.3 | % | 9.2 | % | (1.3 | )% | 4.4 | % | ||||||||||||||||||
1Q17 | 2Q17 | 3Q17 | 4Q17 | 1Q18 | 2Q18 | 3Q18 | 4Q18 | 1Q19 | ||||||||||||||||||||||||||||
Gross Profit/Total Revenues (2018 and 2019) (3)(4) | $ | 2,339 | $ | 2,957 | $ | 4,380 | $ | 2,763 | $ | 2,928 | $ | 3,537 | $ | 4,849 | $ | 3,213 | $ | 2,837 | ||||||||||||||||||
Year/Year Growth/(Decline) (4) | 15.5 | % | 21.5 | % | 22.0 | % | 21.1 | % | 25.2 | % | 19.6 | % | 10.7 | % | 16.3 | % | (3.1 | )% | ||||||||||||||||||
Constant Currency (4) | 17 | % | 24 | % | 19 | % | 17 | % | 18 | % | 16 | % | 13 | % | 21 | % | 3 | % |
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