Shares of Avis Budget Group Inc. rose more than 5% in after-hours trading Monday after the car-rental company’s quarterly profit hit a record and sales topped $3 billion as high demand for rental cars in the summer months continued to push prices higher.
Avis CAR, -1.07% said it earned $674 million, or $10.45 a share, in the June-September quarter, compared with $45 million, or 63 cents a share, in the year-ago period. Adjusted for one-time items, Avis earned $10.74 a share.
Revenue rose 96% to $3 billion, Avis said, which was also 9% higher than third-quarter 2019 revenue. The rental-car company pinned the rising sales on increased per-day revenue and rental days amid summer travel. Fewer rental cars were available in recent months just as more people were traveling.
Analysts polled by FactSet expected Avis to report adjusted earnings of $6.87 a share on sales of $2.7 billion.
“Our third-quarter results are a testament to our team’s ongoing focus around cost discipline and ability to execute operationally,” Chief Executive Joe Ferraro said in a statement. The company is looking to “to build on this positive momentum as the travel environment continues to normalize.”
Avis said it ended the quarter with about $1.3 billion, with an additional $2.7 billion of fleet funding capacity. “We have well-laddered corporate debt and no meaningful maturities until 2024,” it said.
Avis stock has gained 360% this year, compared with gains of around 23% for the S&P 500 index SPX, +0.18%.