SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------
Form 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No. 1-10308
------------
July 23, 1999 (July 21, 1999)
(Date of Report (date of earliest event reported))
Cendant Corporation
(Exact name of Registrant as specified in its charter)
Delaware
(State or other jurisdiction 06-0918165
of incorporation or (I.R.S. Employer
organization) Identification Number)
9 West 57th Street
New York, New York 10019
(Address of principal executive (Zip Code)
office)
(212) 413-1800
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if applicable)
ITEM 5. OTHER EVENTS
Earnings Release. On July 21, 1999, we reported our 1999
second quarter results. Attached hereto as Exhibit 99.1 is the
press release relating to the second quarter earnings release
which is incorporated herein by reference in its entirety.
On July 21, 1999, we announced the final results of our Dutch
Auction Self-Tender Offer for 50 million shares of our common
stock. Reference is made to Exhibit 99.2 herein, which is
incorporated by reference in its entirety.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
EXHIBITS
NO. DESCRIPTION
- -------- -----------------------------------------------------------------------
99.1 Press Release: Cendant Corporation Reports 1999 Second Quarter Results
99.2 Press Release: Cendant Corporation Announces Final Results of its
Dutch Auction Self-Tender Offer
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on behalf by the
undersigned hereunto duly authorized.
CENDANT CORPORATION
BY: /s/ Jon F. Danski
Jon F. Danski
Executive Vice President, Finance and
Chief Accounting Officer
Date: July 23, 1999
CENDANT CORPORATION
CURRENT REPORT ON FORM 8-K
REPORT DATED JULY 23, 1999 (JULY 21, 1999)
EXHIBIT INDEX
Exhibit
No. Description
- ------- --------------------------------------------------------------
99.1 Press Release: Cendant Corporation Reports 1999 Second Quarter
Results
99.2 Press Release: Cendant Corporation Announces Final
Results of Its Dutch Auction Self-Tender Offer
Exhibit 99.1
FOR IMMEDIATE RELEASE
CENDANT REPORTS 1999 SECOND QUARTER RESULTS
Business Unit Performance on Track
Revenues up 8% and Adjusted EBITDA from Continuing Operations up 20%
Net Income per Share $1.05 in 1999 vs. $0.18 in 1998
Adjusted EPS from Continuing Operations
up 26% to $0.24 in 1999 vs. $0.19 in 1998
Company Completes Dutch Auction and
Continues to Sell Non-Strategic Assets in Accordance with Strategic Plan
New York, NY, July 21, 1999 - Cendant Corporation (NYSE: CD) today reported 1999
second quarter results. Cendant Chairman, President and Chief Executive Officer,
Henry R. Silverman stated, "Our core businesses continue to perform in line with
our business plan, with Individual Membership, in particular, making a
significant contribution to EBITDA growth in the second quarter. We remain
confident that we will deliver earnings per share in line with Wall Street
expectations of between $1.00 to $1.07 for the year, up 22% to 30% from $0.82 in
1998, despite timing issues associated with our ongoing asset divestiture and
share repurchase programs."
Operating results for the quarter ended June 30, 1999, as compared with the
prior year second quarter were as follows:
o Revenues were $1.38 billion, up 8% from $1.27 billion
o Adjusted EBITDA from continuing operations was $472 million, up 20% from $394
million o Adjusted net income from continuing operations was $195 million,
up 16% from $169 million
o Adjusted income from continuing operations per share was up 26% to $0.24 vs.
$0.19
o Net income was $862 million compared with $153 million
o Net income per share was $1.05 compared with $0.18
Net income and net income per share in 1999 include an after tax gain of $709
million, or $0.86 per share, on the dispositions of the Company's Fleet business
segment and certain other non-strategic businesses of the Company, including
Match.com, National Leisure Group and National Library of Poetry. Adjusted
EBITDA from continuing operations excludes the pretax gain of $766 million
associated with the divestitures and net unusual pretax charges of $30 million
in 1999 and $5 million in 1998. Unusual charges in both years include
investigation-elated costs and certain other non-recurring items. (See Tables 1
and 2 for consolidated operating results from continuing operations - as
adjusted and as reported.)
Share Repurchase Program and Asset Sales
The Company has reduced shares outstanding by approximately 141 million shares
through open market transactions, its recently announced self tender offer and
the 7.1 million shares returned to the Company in connection with the sale of
Hebdo Mag International. The Company expects to continue to use excess financial
resources, including cash flow from operations and proceeds from asset sales, to
repurchase shares and retire debt. The Company's stated objective is to maintain
a target debt to total capital ratio of 40% or less.
During the second half of 1999 the Company expects to sell several non-strategic
businesses it previously identified to generate proceeds estimated at over $1
billion. The Company expects to use the proceeds and anticipated operating cash
flows to reduce its term loan by about $350 to $400 million and reduce its
shares outstanding by about 40 to 50 million shares (assuming current share
prices) by year end. Accordingly, the Company anticipates that approximately 735
million shares will be outstanding on a diluted basis at December 31, 1999, a
reduction of about 21% from the commencement of the stock buyback program in
November 1998.
Second Quarter Division Results
Total Company performance in the second quarter of 1999 was consistent with the
Company's stated growth targets for the full year. The underlying discussion of
operating results by division for the second quarter of 1999 as compared to the
second quarter of 1998 focuses on Adjusted EBITDA, which is the profit measure
that the Company uses to evaluate performance. (See Table 4 for Revenues and
Adjusted EBITDA by segment and Table 5 for underlying segment revenue drivers.)
Travel Division
Travel segment revenues increased 10% to $290 million as a result of a 9%
increase in franchise fees from lodging properties and car rental locations,
primarily from increases in available rooms, revenue per available room and car
rental days. Increased timeshare subscription and exchange revenues contributed
to overall timeshare revenue growth of 13%. Adjusted EBITDA for the Travel
segment increased 8% to $147 million. Adjusted EBITDA excludes a non-recurring
charge of $23 million, or $0.02 per share after tax, to fund a contribution to
the trust responsible for completing the previously announced transition of the
Company's lodging franchisees to a Company-sponsored property management system.
The Adjusted EBITDA margin of 51% for 1999 was unchanged from 1998.
Cendant disposed of its Fleet operations as of June 30, 1999. Fleet revenues
increased 10% to $106 million, primarily as a result of higher service fee
revenues. The number of service cards and leased vehicles increased by
approximately 18% and 4%, respectively. EBITDA decreased 6% to $41 million
primarily because of higher borrowing costs.
Real Estate Division
Real Estate Franchise revenues increased 21% to $159 million and EBITDA
increased 11% to $114 million. Royalty fees increased 12% primarily as a result
of a 5% increasein home sale transactions and a 6% increase in the average price
of homes sold. In addition, revenues increased as a result of increases in
marketing fund revenues, which were offset directly by marketing fund expenses
on behalf of franchisees, with the effect of lowering margins but having no
impact on profitability. Preferred Alliance revenues declined $10 million due
to certain access fees received in 1998, which were offset by a $10 million
payment received from NRT Incorporated in 1999.
Relocation revenues decreased 3% to $107 million. Lower volumes on certain
relocation services in 1999 were partially offset by higher ancillary service
fees from certain renegotiated contracts and increased outsourcing services
provided by the Company. In 1999 the Company entered into a strategic
partnership with a third-party insurance company, which contributed $7 million
of additional revenues. These increases were partially offset by the sale of
certain niche-market asset management operations in the third quarter of 1998,
which reduced revenues by $4 million. EBITDA increased 30% to $34 million.
Operating expenses decreased 13% principally from cost savings in regional
operations and reduced government home sale expenses.
Mortgage revenues increased 13% to $107 million due to substantial growth in
mortgage origination volume, which increased $1.2 billion, or 19%, to $7.8
billion. Mortgage closings increased and included a shift to more profitable
sales and processing channels, which was responsible for production revenue
growth of $5 million. The servicing portfolio grew 29% to $43.8 billion and
servicing revenue increased $9 million, or 60%, with average servicing fees
increasing slightly. EBITDA increased 11% to $50 million reflecting higher
revenues partially offset by higher operating expenses related to increases in
hiring, technology and capacity to support continued growth.
Direct Marketing Division
Individual Membership revenues increased 16% to $244 million due to an increase
in the number of club members and an increase in the average price of a
membership. EBITDA increased $58 million from a loss of $41 million last year to
a profit of $17 million this year, primarily as a result of increased revenues
and reduced marketing spending, as the Company further refined the targeted
audiences for its direct marketing efforts and further optimized the use of
various marketing media. The Company's online membership business contributed
$15 million to revenues but reduced EBITDA by $10 million in the second quarter
of 1999.
Insurance/Wholesale revenues increased 5% to $143 million, primarily because of
customer growth, which resulted from increases in affiliations with financial
institutions. The increase in revenues was attributable principally to
international expansion. International revenues increased 26% due primarily to a
42% increase in customers. EBITDA increased 41% to $50 million. The segment also
benefited from a decrease in customer acquisition costs related to insurance
products. The EBITDA margin increased from 26% in 1998 to 35% in 1999.
Other Consumer and Business Services
Revenues decreased 3% to $223 million, primarily as a result of a decrease in
income from financial investments and the divestiture of several businesses. The
revenue decreases were partially offset by increased revenues from National
Parking Corporation, the largest private car park operator in the UK, which was
acquired in April 1998. Adjusted EBITDA decreased to $20 million.
Statements about future results made in this release may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements are based on current
expectations and the current economic environment. The Company cautions that
these statements are not guarantees of future performance. They involve a number
of risks and uncertainties that are difficult to predict. Actual results could
differ materially from those expressed or implied in the forward-looking
statements. Important assumptions and other important factors that could cause
actual results to differ materially from those in the forward-looking statements
are specified in the Company's Form 10-K/A for the year ended December 31, 1998,
including the resolution of the pending class action litigation and the
Company's ability to implement its plan to divest non-strategic assets.
Cendant Corporation is a global provider of consumer and business services. The
Company's core competencies include building franchise systems, providing
outsourcing solutions and direct marketing. As a franchisor, Cendant is among
the world's leading franchisors of hotels, rental car agencies, tax preparation
services and real estate brokerage offices. The real estate division also
includes Welcome Wagon/GETKO and the Company's soon-to-be-created residential
real estate services portal on the Internet. As a provider of outsourcing
solutions, Cendant is the world's largest vacation exchange service, a major
provider of mortgage services to consumers and the global leader in employee
relocation. In direct marketing, Cendant provides access to insurance, travel,
shopping, auto, and other services primarily to customers of its affinity
partners. Other business units include NCP, the UK's largest private car park
operator, and Wizcom, an information technology services provider. Headquartered
in New York, NY, the Company has more than 30,000 employees and operates in over
100 countries.
More information about Cendant, its companies, brands and current SEC filings
may be obtained by visiting the Company's Web site at www.Cendant.com or by
calling 877-4INFO-CD (877-446-3623).
Media Contact: Investor Contact:
Elliot Bloom Denise L. Gillen
212-413-1832 212-413-1833
Samuel J. Levenson
212-413-1834
*****
Tables Follow
Table 1
Cendant Corporation and Subsidiaries
Continuing Operations
Second Quarter Financial Results
(Dollars and shares in millions, except per share amounts)
As Adjusted
The 1999 results are adjusted to exclude $6.5 million ($4.0 million, after tax)
of investigation-related costs, a $23.0 million non-recurring charge ($14.9
million, after tax) in connection with the transition of the Company's lodging
franchisees to a Company-sponsored property management system and a $765.7
million gain ($709.1 million, after tax) on the disposition of the Fleet
business segment and certain other non-strategic businesses of the Company,
including Match.com, National Leisure Group ("NLG") and National Library of
Poetry ("NLP").
The 1998 results are adjusted to exclude $32.2 million ($20.4 million, after
tax) of investigation-related costs, including incremental financing costs. The
aforementioned 1998 charges were partially offset by a credit of $27.5 million
($18.6 million, after tax) associated with changes in the estimate of
liabilities previously recorded in connection with merger-related costs and
other unusual charges ("Unusual Charges").
1999 1998 % change
--------- --------- --------
Revenues $ 1,377.3 $ 1,272.3 8%
Expenses 1,053.4 985.8 7%
--------- ---------
Income before income taxes and minority interest 323.9 286.5 13%
EBITDA (1) 472.2 393.7 20%
Income from continuing operations 194.8 168.6 16%
Earnings per share:
Basic $ 0.25 $ 0.20 25%
Diluted 0.24 0.19 26%
Weighted average shares - diluted 823.7 900.9 (9%)
As Reported
1999 1998 % change
--------- --------- --------
Revenues $ 1,377.3 $1,272.3 8%
Expenses 1,082.9 990.5 9%
Gain on businesses sold 765.7 - *
--------- ---------
Income before income taxes and minority interest 1,060.1 281.8 *
EBITDA (1) 1,208.4 389.0 *
Income from continuing operations 885.0 166.8 *
Earnings per share:
Basic $ 1.15 $ 0.20 *
Diluted 1.08 0.19 *
Weighted average shares - diluted 823.7 900.9 (9%)
- ----------
* Not meaningful
(1) Earnings before interest, taxes, depreciation and amortization.
Table 2
Cendant Corporation and Subsidiaries
Continuing Operations
Six Months Ended June 30, 1999 and 1998 (Dollars and shares in millions, except
per share amounts)
As Adjusted
The 1999 results are adjusted to exclude $7.0 million ($4.4 million, after tax)
of costs incurred in connection with the termination of the proposed acquisition
of RAC Motoring Services, $8.2 million ($5.1 million, after tax) of
investigation-related costs and a $23.0 million non-recurring charge ($14.9
million, after-tax) in connection with the transition of the Company's lodging
franchisees to a Company-sponsored property management system, partially offset
by a $1.3 million gain ($0.8 million, after tax) on the sale of Essex
Corporation, a Company subsidiary. In addition, the 1999 results are adjusted to
exclude a $765.7 million gain ($709.1 million, after tax) on the disposition of
the Fleet business segment and certain other non-strategic businesses of the
Company, including Match.com, NLG and NLP.
The 1998 results are adjusted to exclude $32.2 million ($20.4 million, after
tax) of investigation-related costs, including incremental financing costs. The
aforementioned 1998 charges are partially offset by a credit of $24.4 million
($16.2 million, after tax) associated with changes in the estimate of
liabilities previously recorded in connection with Unusual Charges.
1999 1998 % change
--------- --------- --------
Revenues $ 2,682.2 $ 2,392.2 12%
Expenses 2,047.9 1,786.8 15%
--------- ---------
Income before income taxes and minority interest 634.3 605.4 5%
EBITDA (1) 921.9 795.1 16%
Income from continuing operations 380.9 367.3 4%
Earnings per share:
Basic $ 0.49 $ 0.43 14%
Diluted 0.46 0.41 12%
Weighted average shares - diluted 838.9 907.8 (8%)
As Reported
1999 1998 % change
--------- -------- --------
Revenues $ 2,682.2 $2,392.2 12%
Expenses 2,084.8 1,794.6 16%
Gain on businesses sold 765.7 - *
--------- --------
Income before income taxes and minority interest 1,363.1 597.6 *
EBITDA (1) 1,650.7 787.3 *
Income from continuing operations 1,066.4 363.1 *
Earnings per share:
Basic $ 1.36 $ 0.43 *
Diluted 1.28 0.41 *
Weighted average shares - diluted 838.9 907.8 (8%)
- ----------
* Not meaningful
(1) Earnings before interest, taxes, depreciation and amortization.
Table 3
Cendant Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share data)
Three Months Ended Six Months Ended
June 30, June 30
---------------------- -------------------
1999 1998 1999 1998
--------- -------- --------- --------
Revenues
Membership and service fees, net $ 1,333.2 $1,237.8 $ 2,573.7 $2,286.6
Fleet leasing (net of depreciation and interest costs of
$343.3, $318.1, $669.7 and $629.7) 11.3 19.1 29.9 39.0
Other 32.8 15.4 78.6 66.6
--------- -------- --------- --------
Net revenues 1,377.3 1,272.3 2,682.2 2,392.2
--------- -------- --------- --------
Expenses
Operating 435.0 437.0 867.4 748.6
Marketing and reservation 287.9 291.3 550.1 556.1
General and administrative 182.2 150.3 342.8 292.4
Depreciation and amortization 94.2 84.3 185.2 147.9
Other charges
Termination of proposed acquisition - - 7.0 -
Investigation-related costs 6.5 32.2 8.2 32.2
Merger-related costs and other unusual charges (credits) 23.0 (27.5) 21.7 (24.4)
Interest, net 54.1 22.9 102.4 41.8
--------- -------- --------- -------
Total expenses 1,082.9 990.5 2,084.8 1,794.6
--------- -------- --------- -------
Gain on businesses sold 765.7 - 765.7 -
--------- -------- --------- -------
Income from continuing operations before income taxes and
minority interest 1,060.1 281.8 1,363.1 597.6
Provision for income taxes 160.0 100.1 266.5 214.7
Minority interest, net of tax 15.1 14.9 30.2 19.8
--------- -------- --------- -------
Income from continuing operations 885.0 166.8 1,066.4 363.1
Loss from discontinued operations, net of tax (4.1) (13.8) (16.2) (37.2)
Gain (loss) on sale of discontinued operations, net of tax (18.6) - 174.1 -
---------- -------- --------- -------
Net income $ 862.3 $ 153.0 $ 1,224.3 $ 325.9
========= ======== ========= =======
Income (loss) per share
Basic
Income from continuing operations $ 1.15 $ 0.20 $ 1.36 $ 0.43
Loss from discontinued operations (0.01) (0.02) (0.02) (0.04)
Gain (loss) on sale of discontinued operations (0.02) - 0.22 -
--------- ---------- --------- --------
Net income $ 1.12 $ 0.18 $ 1.56 $ 0.39
========= ======== ========= =======
Diluted
Income from continuing operations $ 1.08 $ 0.19 $ 1.28 $ 0.41
Loss from discontinued operations (0.01) (0.01) (0.02) (0.04)
Gain (loss) on sale of discontinued operations (0.02) - 0.21 -
---------- --------- --------- --------
Net income $ 1.05 $ 0.18 $ 1.47 $ 0.37
========= ======== ========= =======
Weighted average shares
Basic 769.5 850.8 784.7 844.8
Diluted 823.7 900.9 838.9 907.8
Table 4
Cendant Corporation and Subsidiaries
Continuing Operations
Revenues and Adjusted EBITDA by Segment
(Dollars in millions)
Quarterly Period Ended June 30,
Revenues Adjusted EBITDA (1)
----------------------------------- -----------------------------------
% %
1999 1998 Change 1999 1998 (6) Change
--------- --------- -------- --------- --------- ---------
Travel $ 289.6 $ 263.6 10% $146.5 (2) $ 135.7 8%
Fleet 105.6 96.0 10% 41.1 43.7 (6%)
Real Estate Franchise 158.9 131.5 21% 113.9 103.1 11%
Relocation 106.8 110.2 (3%) 34.2 26.4 30%
Mortgage 106.6 94.0 13% 49.7 44.8 11%
Individual Membership 243.8 209.6 16% 17.1 (40.9) *
Insurance/Wholesale 143.0 136.8 5% 50.0 35.5 41%
Other 223.0 230.6 (3%) 19.7 (4) 45.4 (5) (57%)
--------- --------- ------- ---------
Total $ 1,377.3 $ 1,272.3 8% $472.2 $ 393.7 20%
========= ========= ====== ========
Six Months Ended June 30,
Revenues Adjusted EBITDA (1)
----------------------------------- -----------------------------------
% %
1999 1998 Change 1999 1998 (7) Change
--------- --------- -------- --------- --------- ---------
Travel $ 561.6 $ 529.2 6% $ 291.2 (2) $ 284.8 2%
Fleet 207.4 192.6 8% 80.8 91.3 (12%)
Real Estate Franchise 255.5 215.8 18% 185.3 162.3 14%
Relocation 197.7 209.9 (6%) 52.1 52.0 -
Mortgage 199.8 172.0 16% 93.7 82.3 14%
Individual Membership 487.2 413.7 18% 29.0 (56.8) *
Insurance/Wholesale 282.7 270.8 4% 88.3 74.6 18%
Other 490.3 388.2 26% 101.5 (3) 104.6 (5) (3%)
--------- --------- -------- ---------
Total $ 2,682.2 $ 2,392.2 12% $ 921.9 $ 795.1 16%
========= ========== ======== ========
- ---------------
* Not meaningful
(1) Earnings before interest, taxes, depreciation and amortization, and gains
on businesses sold, adjusted to exclude non-recurring or unusual items.
(2) Excludes a $23.0 million non-recurring charge in connection with the
transition of the Company's lodging franchisees to a Company-sponsored
property management system.
(3) Excludes: (i) the $23.0 million non-recurring charge as described in Note
2; (ii) $8.2 million of investigation-related costs; and (iii) $7.0
million of costs incurred in connection with the termination of the
proposed acquisition of RAC Motoring Services, partially offset by a $1.3
million gain on the sale of Essex.
(4) Excludes $6.5 million of investigation-related costs.
(5) Excludes $32.2 million of investigation-related costs, including
incremental financing costs.
(6) Excludes a net credit of $27.5 million associated with changes in the
estimate of liabilities previously recorded in connection with Unusual
Charges. The aforementioned net credit was comprised of $5.4 million,
$1.3 million, $1.0 million and $25.3 million of credits within the
Travel, Fleet, Real Estate Franchise and Other segments, respectively,
and $3.7 million and $1.8 million of charges incurred within the
Relocation and Mortgage segments, respectively.
(7) Excludes a net credit of $24.4 million associated with changes in the
estimate of liabilities previously recorded in connection with Unusual
Charges. The aforementioned net credit was comprised of $5.4 million,
$1.3 million, $1.0 million and $24.1 million of credits within the
Travel, Fleet, Real Estate Franchise and Other segments, respectively,
and $3.7 million and $3.7 million of charges incurred within the
Relocation and Mortgage segments, respectively
Table 5
Cendant Corporation and Subsidiaries
Segment Revenue Driver Analysis
(Revenue dollars in millions)
2nd Quarter
%
1999 1998 Change
-------------- ------------- ---------
Travel Segment
Domestic Rooms
Month End Actual Rooms 509,706 487,168 5
Weighted Average Rooms Available 496,299 474,662 5
Franchise Fee per Weighted Average Room $ 228.12 $ 220.86 3
------------- -------------
Total Franchise Fees $ 113.2 $ 104.8 8
------------- -------------
Car Rental days 15,315,889 13,867,489 10
Franchise Fee per Rental day $ 2.92 $ 2.87 2
------------- -------------
Total Franchise Fees $ 44.7 $ 39.8 12
Sub-Total Franchise Fees $ 157.9 $ 144.6 9
------------- -------------
Number of Timeshare Exchanges 455,565 411,711 11
Annualized Number of Exchanges 1,822,260 1,646,844 11
Average Subscriptions 2,299,123 2,186,424 5
------------- -------------
Total Exchanges and Subscriptions 4,121,383 3,833,268 8
Average Fee $ 20.68 $ 20.87 (1)
------------- -------------
Total Exchange/Subscription Fees $ 85.2 $ 80.0 7
------------- -------------
Other Revenue $ 46.5 $ 39.0 19
Total Travel Revenue $ 289.6 $ 263.6 10
============= =============
Fleet Segment
Number of Cars/Cards 4,733,703 4,054,128 17
Revenue per Car/Card $ 22.31 $ 23.68 (6)
------------- -------------
Total Revenue $ 105.6 $ 96.0 10
============= =============
Real Estate Franchise Segment
Closed sides - Domestic 524,777 498,893 5
Average Price $ 151,430 $ 142,735 6
Adjusted Royalty Rate 0.15% 0.15% -
------------- -------------
Total Royalties $ 121.9 $ 108.7 12
Other 37.0 22.8 62
------------- -------------
Total Revenue $ 158.9 $ 131.5 21
============= =============
Mortgage Segment
Production Loan Closings (1) $ 7,816 $ 6,576 19
Avg. Servicing Loan Portfolio $ 43,751 $ 34,004 29
Table 6
Cendant Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(In billions)
June 30, December 31,
1999 1998
-------- ------------
Assets
Cash $ 0.3 $ 1.0
Restricted cash 1.2 0.1
Other current assets 2.7 3.5
-------- --------
Total current assets 4.2 4.6
Property and equipment, net 1.3 1.4
Goodwill, net 3.6 3.9
Other assets 3.1 2.8
-------- --------
Total assets exclusive of assets under programs 12.2 12.7
Assets under management and mortgage programs 5.3 7.5
-------- --------
Total assets $ 17.5 $ 20.2
======== ========
Liabilities and shareholders' equity
Total current liabilities $ 2.7 $ 2.9
Long-term debt 3.3 3.4
Other non-current liabilities 0.5 0.4
-------- --------
Total liabilities exclusive of liabilities
under programs 6.5 6.7
Liabilities under management and mortgage programs 4.7 7.2
Mandatorily redeemable preferred securities issued
by subsidiary 1.5 1.5
Commitments and contingencies
Total shareholders' equity 4.8 4.8
-------- --------
Total liabilities and shareholders' equity $ 17.5 $ 20.2
======== ========
FOR IMMEDIATE RELEASE Exhibit 99.2
FOR IMMEDIATE RELEASE
CENDANT CORPORATION ANNOUNCES FINAL RESULTS OF ITS
DUTCH AUCTION SELF-TENDER OFFER
New York, NY, July 21, 1999 - Cendant Corporation (NYSE:CD) today announced
that, in accordance with the final results of its Dutch Auction self-tender
offer which expired on July 15, 1999 at 12:00 midnight, New York City time, the
Company will purchase 50 million shares validly tendered at a price of $22.25
per share. The final proration factor for the tender offer is 90.0126%. All
holders of fewer than 100 shares who validly tendered at a price of $22.25 per
share or less will not be subject to proration. The Company has also elected to
purchase an additional 2,850 shares validly tendered by holders at or below
$22.25 per share which, as a result of proration, resulted in such holders
owning fewer than 100 shares. The Company had announced the preliminary results
of the offer on July 16, 1999.
The final count by the depositary for the offer indicated that
approximately 55.5 million shares were tendered (including approximately 145,000
shares in odd lots) and not withdrawn at prices of $22.25 per share or lower.
The depositary for the offer will promptly issue payment for the shares accepted
under the offer and return all shares tendered in excess of this price and
shares not accepted because of proration. The shares purchased represent about
7% of the approximately 768 million shares outstanding immediately prior to the
offer.
Including shares repurchased by way of the Dutch Auction self-tender offer,
the Company's previously announced and completed share repurchase programs and
the 7.1 million shares returned to the Company in connection with the sale of
Hebdo Mag International, Cendant has repurchased approximately 141 million
shares. In aggregate, Cendant's share repurchase programs have risen to
approximately $2.9 billion. Cendant expects to continue to use excess financial
resources, including cash flow from operations and proceeds from asset sales, to
repurchase shares and retire debt. The Company's stated objective is to maintain
a target debt to total capital ratio of 40% or less.
Statements about future results made in this release may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements are based on current
expectations and the current economic environment. The Company cautions that
these statements are not guarantees of future performance. They involve a number
of risks and uncertainties that are difficult to predict. Actual results could
differ materially from those expressed or implied in the forward-looking
statements. Important assumptions and other important factors that could cause
actual results to differ materially from those in the forward-looking statements
are specified in the Company's Form 10-K/A for the year ended December 31, 1998,
including the resolution of the pending class action litigation and the
Company's ability to implement its plan to divest non-strategic assets.
Cendant Corporation is a global provider of consumer and business services.
The Company's core competencies include building franchise systems, providing
outsourcing solutions and direct marketing. As a franchisor, Cendant is among
the world's leading franchisors of hotels, rental car agencies, tax preparation
services and real estate brokerage offices. The real estate segment also
includes Welcome Wagon/GETKO and the Company's soon-to-be-created residential
real estate services portal on the Internet. As a provider of outsourcing
solutions, Cendant is the world's largest vacation exchange service, a major
provider of mortgage services to consumers and the global leader in employee
relocation. In direct marketing, Cendant provides access to insurance, travel,
shopping, auto, and other services primarily to customers of its affinity
partners. Other business units include NCP, the UK's largest private car park
operator, and Wizcom, an information technology services provider. Headquartered
in New York, NY, the Company has more than 30,000 employees and operates in over
100 countries.
More information about Cendant, its companies, brands and current SEC
filings may be obtained by visiting the Company's Web site at www.cendant.com or
by calling 877-4INFO-CD (877-446-3623).
Media Contact: Investor Contact:
Elliot Bloom Denise L. Gillen
212-413-1833 212-413-1833
Samuel J. Levenson
212-413-1834