Having shed its money-losing Asia-Pacific businesses in the fourth quarter, Travelzoo posted net income of $1.5 million during the period from its businesses in North America and Europe on revenue of $23.8 million, a 21% year-over-year increase. In the fourth quarter of 2008, the travel media company had recorded net income of $1.7 million from these businesses.
Travelzoo CEO Holger Bartel states that its North American and European businesses combined attracted record revenue in the quarter and operating margins improved despite the company's aggressive investments in the Fly.com metasearch business and in Europe.
Travelzoo's operating profit in North America was $5.3 million on revenue of $19.3 million, a 12% increase from the fourth quarter of 2008, the company says.
In Europe, where Travelzoo operates in the U.K., Germany, France and Spain, revenue grew 91% to $4.6 million, but the operating loss climbed to $1.8 million from a loss of $1.3 million a year earlier. However, Travelzoo's UK business posted a slight profit in 2009.
Thus, Travelzoo's European business is about one-fourth the size of its North American businesses in terms of revenue, but has yet to turn the corner into profitability mode.
In the fourth quarter, Travelzoo, a pubicly traded company controlled by founder and Chairman Ralph Bartel, sold its Asia-Pacific division, including Travelzoo Hong Kong, Travelzoo Japan, Travelzoo China, Travelzoo Taiwan andTravelzoo Australia, for $3.6 million million to companies controlled by — Ralph Bartel.
Travelzoo has an option to buy back the APCA businesses beginning in 2011.