Travelzoo Reports First Quarter 2022 Results

Research, News, and Market Data on Travelzoo

 

Travelzoo® (NASDAQ: TZOO):

• Consolidated revenue of 
  $18.5 million, up 29% year-over-year
• Non-GAAP consolidated operating profit of 
  $2.7 million
• Earnings per share (EPS) of 
  $0.19 attributable to 
  Travelzoo from continuing operations

Travelzoo, a global Internet media company that provides exclusive offers and experiences for members, today announced financial results for the first quarter ended 
March 31, 2022. Consolidated revenue was 
$18.5 million, up 29% from 
$14.3 million year-over-year. 
Travelzoo’s reported revenue consists of advertising revenues and commissions, derived from and generated in connection with purchases made by 
Travelzoo members.

The reported net income attributable to 
Travelzoo from continuing operations was 
$2.4 million for Q1 2022. At the consolidated level, including minority interests, the reported net income from continuing operations was 
$2.4 million. EPS from continuing operations was 
$0.19, compared to (
$0.14) in the prior-year period.

Non-GAAP operating profit was 
$2.7 million. The calculation of non-GAAP operating profit excludes amortization of intangibles (
$0.2 million) and stock option expenses (
$0.5 million). See section “Non-GAAP Financial Measures” below.

“We see continued improvement in our business. We seize the exceptional industry opportunities for providing 30 million 
Travelzoo members exclusive and irresistible travel, entertainment, and local offers and experiences. 
Travelzoo members are affluent, active, and open to new experiences. 84% say 
Travelzoo influences their travel destinations because they trust 
Travelzoo“, said  Holger Bartel, Global CEO.

Cash Position
As of 
March 31, 2022, consolidated cash, cash equivalents and restricted cash were 
$36.7 million. Net cash used in operations was 
$6.8 million. Cash was used primarily in connection with a decrease of merchant payables by 
$8.0 million. The Company also used cash of 
$1.0 million to acquire intangible assets in Q1 2022.

Reserve
Reported revenues include a reserve of 
$3.8 million related to commissions to be earned from vouchers sold. The reserve is booked as contra revenue.

Travelzoo North America

North America business segment revenue increased 19% year-over-year to 
$11.7 million. Operating profit for Q1 2022 was 
$1.7 million, or 15% of revenue, compared to an operating profit of 
$39,000 in the prior-year period.

Travelzoo Europe

Europe business segment revenue increased 66% year-over-year to 
$5.9 million. Operating profit for Q1 2022 was 
$178,000, or 3% of revenue, compared to an operating loss of 
$696,000 in the prior-year period.

Jack’s Flight Club
On 
January 13, 2020, 
Travelzoo acquired 60% of 
Jack’s Flight Club, a membership subscription service. 
Jack’s Flight Club revenue decreased 7% year-over-year to 
$823,000. Non-GAAP operating profit for Q1 2022 was 
$249,000, compared to a non-GAAP operating profit of 
$174,000 in the prior-year period. After consolidation with 
Travelzoo, 
Jack’s Flight Club’s net income was 
$11,000, with 
$7,000 attributable to 
Travelzoo as a result of recording 
$226,000 of amortization of intangible assets related to the acquisition.

Licensing
In 
June 2020, 
Travelzoo entered into a royalty-bearing licensing agreement with a local licensee in 
Japan for the exclusive use of 
Travelzoo’s brand, business model, and members in 
Japan. In August of 2020, 
Travelzoo entered into a royalty-bearing licensing agreement with a local licensee in 
Australia for the exclusive use of 
Travelzoo’s brand, business models, and members in 
Australia, 
New Zealand, and 
Singapore. Under these arrangements, 
Travelzoo’s existing members in 
Australia, 
Japan, 
New Zealand, and 
Singapore will continue to be owned by 
Travelzoo as the licensor. Licensing revenue is booked with a lag of one quarter. 
Travelzoo recorded 
$9,000 in licensing revenue from the licensee in 
Japan in Q1 2021. 
Travelzoo recorded 
$7,000 in licensing revenue from the licensee in 
Australia, 
New Zealand, and 
Singapore in Q1 2022. Licensing revenue is expected to increase going forward.

Members and Subscribers
As of 
March 31, 2022, we had 30.7 million members worldwide. In 
North America, the unduplicated number of 
Travelzoo members was 16.7 million as of 
March 31, 2022, down 8% from 
March 31, 2021. In 
Europe, the unduplicated number of 
Travelzoo members was 9.1 million as of 
March 31, 2022, up 5% from 
March 31, 2021. 
Jack’s Flight Club had 1.7 million subscribers as of 
March 31, 2022, up 6% from 
March 31, 2021.

Discontinued Operations
As announced in a press release on 
March 10, 2020, 
Travelzoo decided to exit its 
Asia Pacific business and operate it as a licensing business going forward. Consequently, the 
Asia Pacific business has been classified as discontinued operations since 
March 31, 2020. Prior periods have been reclassified to conform with the current presentation. Certain reclassifications have been made for current and prior periods between the continued operations and the discontinued operations in accordance with 
U.S. GAAP.

Income Taxes
Income tax expense was 
$968,000 in Q1 2022, compared to an income tax expense of 
$742,000 in the prior-year period.

Non-GAAP Financial Measures
Management calculates non-GAAP operating income when evaluating the financial performance of the business. 
Travelzoo’s calculation of non-GAAP operating income, also called “non-GAAP operating profit” in this press release and today’s earnings conference call, excludes the following items: impairment of intangibles and goodwill, amortization of intangibles, stock option expenses, and severance- related expenses. This press release includes a table which reconciles GAAP operating income to the calculation of non-GAAP operating income. Non-GAAP operating income is not required by, or presented in accordance with, generally accepted accounting principles in 
the United States of America (“GAAP”). This information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly titled measures reported by other companies.

Looking Ahead
We currently expect higher revenue and profitability in Q2 2022. We continue to see a trend of recovery of our revenue. However, there could be unexpected fluctuations in the short term. During the pandemic, we have been able to lower our fixed costs. We believe we can keep our fixed costs relatively low in the foreseeable future—while revenue is expected to grow.

Conference Call

Travelzoo will host a conference call to discuss first quarter results and provide an update on Travelzoo META today at 
11:00 a.m. ET. Please visit http://ir.travelzoo.com/events-presentations to

• download the management presentation (PDF format) to be discussed in the conference call; and
• access the webcast.

About Travelzoo
Travelzoo® provides its 30 million members with exclusive offers and one-of-a-kind experiences personally reviewed by our deal experts around the globe. We have our finger on the pulse of outstanding travel, entertainment, and lifestyle experiences. We work in partnership with more than 5,000 top travel suppliers—our long-standing relationships give 
Travelzoo members access to irresistible deals.

Certain statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations, prospects and intentions, markets in which we participate and other statements contained in this press release that are not historical facts. When used in this press release, the words “expect”, “predict”, “project”, “anticipate”, “believe”, “estimate”, “intend”, “plan”, “seek” and similar expressions are generally intended to identify forward-looking statements. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including changes in our plans, objectives, expectations, prospects and intentions and other factors discussed in our filings with the 
SEC. We cannot guarantee any future levels of activity, performance or achievements. 
Travelzoo undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.

Travelzoo, Top 20, and 
Jack’s Flight Club are registered trademarks of 
Travelzoo.

 

 

 

 

 

 

Investor Relations:
Almira Pusch
ir@travelzoo.com