Travelzoo 2006 Annual Report Download - page 77

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Significant customer information is as follows:
Customer 2006 2005 2004
December 31,
2006
December 31,
2005
Year Ended
December 31,
Percent of
Revenues Percent of
Accounts
Receivable
Travelport Limited ....................... 16% 12% * 16% 15%
Expedia, Inc. ........................... 14% * * 16% *
Sabre Holdings Corporation ................ * 15% 12% * 13%
* Less than 10%
The agreements with these customers are in the form of multiple insertion orders from groups of entities under
common control, in either the Company’s standard form or in the customer’s form.
(8) 401(k) Plan
The Company maintains a 401(k) Profit Sharing Plan & Trust (the “401(k) Plan”) for its employees in the
United States. The 401(k) Plan allows employees of the Company to contribute up to 80% of their eligible
compensation, subject to certain limitations. Starting in 2006, the Company matches employee contributions up to
$1,500 per year. Employee contributions are fully vested, whereas the Company’s matching contributions are fully
vested after the first year of service. The Company’s contributions to the 401(k) Plan were approximately $82,000
during 2006. There were no Company contributions to the 401(k) Plan in 2005 and 2004.
(9) Unaudited Quarterly Information
The following represents unaudited quarterly financial data for 2006 and 2005.
Dec 31,
2006
Sept 30,
2006
June 30,
2006
Mar 31,
2006
Dec 31,
2005
Sept 30,
2005
June 30,
2005
Mar 31,
2005
Quarters Ended
(In thousands, except per share amounts)
Revenues .................. $17,652 $17,586 $17,358 $16,929 $13,901 $13,384 $12,258 $11,228
Cost of revenues............. 256 232 286 264 249 225 224 179
Gross profit............. 17,396 17,354 17,072 16,665 13,652 13,159 12,034 11,049
Operating expenses:
Sales and marketing ........ 7,331 6,975 7,973 7,099 7,632 7,101 6,152 5,030
General and administrative. . . . 2,394 2,249 2,112 2,601 2,496 1,878 2,127 2,608
Total operating expenses . . . 9,725 9,224 10,085 9,700 10,128 8,979 8,279 7,638
Income from operations ....... 7,671 8,130 6,987 6,965 3,524 4,180 3,755 3,411
Interest income.............. 323 280 302 344 304 279 218 160
Foreign currency gain (loss) . . . . (10) 7 13 (7) (6) (4) (4) —
Income before income taxes . . . . 7,984 8,417 7,302 7,302 3,822 4,455 3,969 3,571
Income tax expense . ......... 3,699 3,866 3,452 3,185 2,168 2,156 1,791 1,739
Net income . . .............. $ 4,285 $ 4,551 $ 3,850 $ 4,117 $ 1,654 $ 2,299 $ 2,178 $ 1,832
Basic net income per share . . . . . $ .28 $ .30 $ .25 $ .26 $ .10 $ .14 $ .13 $ .11
Diluted net income per share . . . . $ .26 $ .28 $ .23 $ .24 $ .10 $ .13 $ .12 $ .10
50
TRAVELZOO INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)