<Page>
EXHIBIT 99
[LOGO]
CENDANT REPORTS RECORD OPERATING RESULTS FOR
THE THIRD QUARTER OF 2003, EXCEEDING PROJECTIONS
3Q 2003 EPS from Continuing Operations Increased 96% to $0.47
Versus $0.24 in 3Q 2002
3Q 2003 Net Cash Provided By Operating Activities Increased to $1.06 Billion
Versus $1.05 Billion in 3Q 2002
3Q 2003 Free Cash Flow Increased 94% to $1.0 Billion
Versus $0.5 Billion in 3Q 2002
2003 EPS from Continuing Operations Projection Raised to $1.40 - $1.41
NEW YORK, NY, OCTOBER 20, 2003 - Cendant Corporation (NYSE: CD) today
reported third quarter 2003 EPS from Continuing Operations of $0.47, versus
$0.24 in third quarter 2002, an increase of 96%. This result exceeded the
Company's prior projection of $0.44 - $0.45.
As a result of the better than expected third quarter results, the Company
raised its EPS from Continuing Operations projection for full year 2003 to $1.40
- - $1.41 from its prior projection of $1.37 - $1.39, an increase of approximately
40% versus the prior year. The Company also forecasts 2003 Net Cash Provided by
Operating Activities exceeding $5 billion and Free Cash Flow approaching $2.5
billion. These projections reflect prolonged strength in the residential real
estate market and modestly improving travel activity, balanced by lower mortgage
refinancing volumes and the challenges of the current economic environment.
Cendant's Chairman, Chief Executive Officer and President, Henry R. Silverman,
stated: "During the third quarter, residential real estate sales and mortgage
volumes continued to show robust year over year growth, and leisure travel
trends continued to firm, enabling us to exceed our projections for the quarter.
Despite a challenging environment, our diversified portfolio on the whole
generated organic growth.
"In 2004, we expect that continued strong results from our real estate franchise
and brokerage businesses, improving travel trends, and the successful completion
of the integration of the principal car and truck rental operations of Budget
Group, Inc. will more than offset the likely decline in mortgage refinancing
from which Cendant has benefited in 2003. We continue to expect that the Company
will generate in excess of $2 billion of Free Cash Flow per year for the
foreseeable future. We intend to deploy our cash primarily to reduce corporate
debt and repurchase common stock and, as
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previously announced, in first quarter 2004, we intend to begin paying a
quarterly cash dividend on our common shares."
THIRD QUARTER ACHIEVEMENTS
The Company made considerable progress towards its cash flow generation, debt
reduction and share repurchase goals during the quarter:
o Generated Net Cash Provided by Operating Activities of approximately
$1.06 billion and Free Cash Flow of approximately $1.0 billion due to
favorable operating results and, in part, to the timing of cash inflows
and a tax refund advance of $175 million, which will be partially
offset in fourth quarter 2003 by tax payments. See Table 7 for a
description of Free Cash Flow and a reconciliation to Net Cash Provided
by Operating Activities.
o Reduced corporate debt net of cash on the balance sheet by
$878 million, including the prepayment of our $375 million mandatorily
redeemable debt securities at par. Corporate debt excludes Debt under
Management and Mortgage Programs. See Table 5 for more detailed
information.
o Utilized $249 million of cash for the repurchase of common stock.
In addition:
o The Company's Board of Directors authorized an additional $500 million,
plus proceeds from stock option exercises, for the repurchase of common
stock.
o The Company completed its analysis with respect to Trilegiant
Corporation and Bishop's Gate Residential Mortgage Trust pursuant to
FASB Interpretation No. 46, and consolidated those entities effective
July 1, 2003. As previously disclosed, the consolidation of Trilegiant
resulted in a non-cash charge of $293 million, to reflect the
cumulative effect of accounting change in third quarter 2003, which had
no impact on cash flow or income from continuing operations or the
related per share amounts.
THIRD QUARTER 2003 RESULTS OF REPORTABLE OPERATING SEGMENTS
The following discussion of operating results focuses on revenue and EBITDA for
each of our reportable operating segments. EBITDA is defined as earnings from
continuing operations before non-program related depreciation and amortization,
non-program related interest, amortization of pendings and listings, income
taxes and minority interest. EBITDA is the measure that we use to evaluate
performance in each of our reportable operating segments in accordance with
generally accepted accounting principles. Revenue and EBITDA are expressed in
millions. See Table 8 for details on the organic growth of our reportable
operating segments for third quarter 2003.
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REAL ESTATE SERVICES
(Consisting of the Company's real estate franchise brands, brokerage operations,
mortgage services, settlement services and relocation services)
<Table>
<Caption>
2003 2002 % CHANGE
---- ---- --------
REVENUE $ 1,998 $ 1,331 50%
----------- ----------- -----
EBITDA $ 436 $ 59 639%
=========== =========== =====
</Table>
Revenue and EBITDA increased due to strong organic growth in substantially all
of our real estate businesses. In particular, we generated growth in our
mortgage business as a result of an increase of 107% in mortgage loan production
revenue and the absence of the $275 million mortgage servicing rights asset
write-down recorded in third quarter 2002. Real estate franchise royalty and
marketing fund revenues increased 18%, primarily due to a 10% increase in home
sale transactions and a 12% increase in average price, and revenue generated by
our NRT real estate brokerage business increased 18% organically, primarily due
to increases in home sale transactions and average price. Acquisitions by NRT
subsequent to second quarter 2002 and increased volumes of settlement services
also contributed to the quarter-over-quarter increase in revenue and EBITDA.
HOSPITALITY
(Consisting of the Company's nine franchised lodging brands, timeshare exchange
and timeshare sales and marketing, and vacation rental businesses)
<Table>
<Caption>
2003 2002 % CHANGE
---- ---- --------
REVENUE $ 696 $ 671 4%
----------- ----------- -----
EBITDA $ 189 $ 204 (7%)
=========== =========== =====
</Table>
Revenue and EBITDA were positively impacted by 10% growth in timeshare sales
revenue and 7% growth in RCI timeshare subscription and exchange revenue. As
previously announced, the principal securitization structure for our timeshare
receivables was amended in third quarter 2003, which resulted in our
consolidation of that structure and, in turn, increased the transparency of our
operating results. Subsequent to consolidation, we no longer recognize gains
upon the securitization of timeshare receivables, which had a negative impact on
EBITDA for third quarter 2003. EBITDA also declined due to higher product costs
on developed timeshare inventory and an increased investment in timeshare
marketing, which should generate incremental revenues and EBITDA in future
periods. EBITDA was reduced by approximately $30 million due to these three
factors; however, in fourth quarter 2003, we expect Hospitality operating
results to exceed the prior year period's levels.
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TRAVEL DISTRIBUTION
(Consisting of electronic global distribution services for the travel industry
and on-line and off-line travel agency services)
<Table>
<Caption>
2003 2002 % CHANGE
---- ---- --------
REVENUE $ 424 $ 432 (2%)
----------- ----------- ---
EBITDA $ 119 $ 129 (8%)
=========== =========== ===
</Table>
Revenue and EBITDA were negatively impacted by decreased international travel
volumes, including a 3% reduction in Galileo air travel booking fees. In
addition, Trip Network, Inc., which operates the on-line travel business of
Cheap Tickets and was acquired in March 2003, contributed incremental revenue
but negatively affected EBITDA. The global travel industry continued to be
subjected to negative economic pressures and geopolitical concerns; however,
successful cost reduction efforts have mitigated the EBITDA impact from reduced
travel demand.
VEHICLE SERVICES
(Consisting of vehicle rental, vehicle management services and fleet card
services)
<Table>
<Caption>
2003 2002 % CHANGE
---- ---- --------
REVENUE $ 1,574 $ 1,085 45%
----------- ----------- --
EBITDA $ 187 $ 143 31%
=========== =========== ==
</Table>
Revenue and EBITDA increased due to the acquisition of the principal car and
truck rental operations of Budget Group, Inc. in fourth quarter 2002 and due to
organic growth in Wright Express' fuel card management business. Lower domestic
car rental volume at Avis was partially offset by a 2% increase in car rental
pricing. The integration of Budget, which represents a significant growth
opportunity in 2004, is proceeding according to plan.
FINANCIAL SERVICES
(Consisting of individual membership products, insurance-related services,
financial services enhancement products and tax preparation services)
<Table>
<Caption>
2003 2002 % CHANGE
---- ---- --------
REVENUE $ 370 $ 322 15%
----------- ----------- ---
EBITDA $ 62 $ 122 (49%)
=========== =========== ===
</Table>
Revenue increased primarily due to the consolidation of Trilegiant on July 1,
2003 pursuant to FASB Interpretation No. 46; however, there was minimal impact
on EBITDA. Revenue and EBITDA were reduced, as expected, by the continued
attrition of the base of members that we retained at the time of the 2001
outsourcing of our membership business to Trilegiant. The effect on EBITDA was
partially mitigated by a net reduction in expenses from servicing fewer members.
In addition, revenue and EBITDA were positively impacted by growth in our
insurance-wholesale businesses and negatively impacted by the timing of revenue
at Jackson Hewitt, our tax preparation business, and by restructuring costs at
Cims, our international membership business, during third quarter 2003, which
will benefit operating results in future periods. Although the year-over-year
EBITDA comparisons for Financial Services
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have been negative throughout much of 2003, we expect the EBITDA of this
division in 2004 to exceed 2003 levels.
OTHER ITEMS
o As of September 30, 2003, the Company had approximately $1.0 billion
of cash and cash equivalents and approximately $6.3 billion of
corporate debt outstanding, including $863 million of mandatorily
convertible Upper DECS securities.
o As of September 30, 2003, the Company's $2.9 billion credit facility
was supporting $1.2 billion in letters of credit used primarily as
credit enhancement for our debt under management and mortgage programs.
The Company had $1.7 billion of availability for use as of September
30, 2003.
o As of September 30, 2003, the Company's net debt to total
capitalization ratio was 34.6%, versus 41.9% as of December 31, 2002
(see calculation on Table 5). The Company's interest coverage ratio was
13 to 1 for third quarter 2003 (see calculation on Table 1).
o Weighted average common shares outstanding, including dilutive
securities, used to calculate EPS was 1.039 billion for third quarter
2003, versus 1.058 billion for third quarter 2002.
2003 OUTLOOK
The Company projects the following EPS from Continuing Operations for the
remainder of 2003:
<Table>
<Caption>
FOURTH FULL
QUARTER YEAR
------- ----
2003 $0.27 $1.40 - 1.41(a)
2002 $0.24 $1.01(b)
</Table>
(a) The projected result is presented as a range to reflect the potential
variance from rounding the quarterly amounts.
(b) Reflects the reclassification of extraordinary losses on the early
extinguishments of debt ($0.03 for full year) to continuing operations
in accordance with the adoption of a new accounting pronouncement
under generally accepted accounting principles effective
January 1, 2003.
The comparability of the Company's earnings from 2002 to 2003 is impacted by the
acquisitions of NRT in April 2002, Trendwest in May 2002, and Budget's car and
truck rental operations in November 2002; the mortgage servicing rights asset
write-down in third quarter 2002; the securities litigation charge recorded in
fourth quarter 2002; the debt extinguishment costs incurred in second quarter
2002 and first quarter 2003, which are partially mitigated by reduced interest
expense in subsequent quarters; the gain on sale of our equity investment in
Entertainment Publications, Inc. in first quarter 2003; and the consolidation of
Trilegiant on July 1, 2003.
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The Company also announced the following detailed financial projections for full
year 2003 (in millions):
<Table>
<Caption>
FULL YEAR 2002 FULL YEAR 2003
REVENUE ACTUAL PROJECTED
------- ------ ---------
Real Estate Services $4,687 $6,550 - 6,650
Hospitality 2,180 2,500 - 2,550
Travel Distribution 1,695 1,650 - 1,700
Vehicle Services 4,175 5,650 - 5,750
Financial Services 1,325 1,375 - 1,400
------- ----------------
Total Reportable Operating Segments $14,062 $17,775 - 18,000
Corporate and Other 26 50 - 75
------- ----------------
Total Revenue $14,088 $17,825 - 18,075
======= ================
EBITDA
Real Estate Services $832 $1,250 - 1,275
Hospitality 625 635 - 660
Travel Distribution 526 450 - 475
Vehicle Services 408 450 - 475
Financial Services 450 350 - 375
------- ----------------
Total Reportable Operating Segments $2,841 $3,185 - 3,210
Corporate and Other (198) (75 - 50)
Depreciation and amortization(a) (466) (535 - 520)
Amortization of pendings/listings (256) (20 - 15)
Interest expense, net (b) (304) (375 - 365)
------- ----------------
Pretax income $1,617 $2,180 - 2,260
Provision for income taxes (544) (725 - 755)
Minority interest (22) (25 - 20)
------- ----------------
Income from continuing operations $1,051 $1,430 - 1,485
======= ================
Diluted weighted average shares outstanding (c) 1,043 1,041 - 1,038
</Table>
* Projections do not total because we do not expect the actual results
of all segments to be at the lowest or highest end of any projected
range simultaneously.
* The effective tax rate is expected to be 33.3% in 2003.
(a) Depreciation and amortization excludes amounts related to our assets
under management and mortgage programs, and interest expense excludes
amounts related to our debt under management and mortgage programs,
both of which are already reflected in EBITDA.
(b) 2002 interest expense includes $42 million of losses on the early
extinguishment of debt in connection with the adoption of a new
accounting pronouncement under generally accepted accounting principles
effective January 1, 2003, which required the reclassification of such
losses from extraordinary items to continuing operations. 2003 interest
expense includes $58 million of losses on the early extinguishment of
debt.
(c) Diluted weighted average shares outstanding forecasted for 2003
reflect the full-year impact of the Trendwest and NRT acquisitions,
which were completed in 2002 for stock, offset by actual and
anticipated common stock repurchases.
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INVESTOR CONFERENCE CALL
Cendant will host a conference call to discuss the third quarter results on
Tuesday, October 21, 2003, at 11:00 a.m. (EST). Investors may access the call
live at WWW.CENDANT.COM or by dialing (719) 457-2679. A web replay will be
available at WWW.CENDANT.COM following the call. A telephone replay will be
available from 2:00 p.m. (EST) on October 21, 2003 until 8:00 p.m. (EST) on
October 28, 2003 at (719) 457-0820, access code: 582271.
Cendant Corporation is primarily a provider of travel and residential real
estate services. With approximately 90,000 employees, New York City-based
Cendant provides these services to businesses and consumers 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 877-4-INFOCD (877-446-3623).
STATEMENTS ABOUT FUTURE RESULTS MADE IN THIS RELEASE, INCLUDING THE PROJECTIONS,
AND THE STATEMENTS ATTACHED HERETO 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. ACTUAL RESULTS MAY 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 CENDANT'S FORM 10-Q FOR
THE PERIOD ENDED JUNE 30, 2003.
SUCH FORWARD-LOOKING STATEMENTS INCLUDE PROJECTIONS. SUCH PROJECTIONS WERE NOT
PREPARED IN ACCORDANCE WITH PUBLISHED GUIDELINES OF THE AMERICAN INSTITUTE OF
CERTIFIED PUBLIC ACCOUNTANTS OR THE SEC REGARDING PROJECTIONS AND FORECASTS, NOR
HAVE SUCH PROJECTIONS BEEN AUDITED, EXAMINED OR OTHERWISE REVIEWED BY
INDEPENDENT AUDITORS OF CENDANT OR ITS AFFILIATES. IN ADDITION, SUCH PROJECTIONS
ARE BASED UPON MANY ESTIMATES AND ARE INHERENTLY SUBJECT TO SIGNIFICANT
ECONOMIC, COMPETITIVE AND OTHER UNCERTAINTIES AND CONTINGENCIES, INCLUDING BUT
NOT LIMITED TO THE IMPACT OF WAR, TERRORISM OR PANDEMICS, WHICH ARE BEYOND THE
CONTROL OF MANAGEMENT OF CENDANT AND ITS AFFILIATES. ACCORDINGLY, ACTUAL RESULTS
MAY BE MATERIALLY HIGHER OR LOWER THAN THOSE PROJECTED. THE INCLUSION OF SUCH
PROJECTIONS HEREIN SHOULD NOT BE REGARDED AS A REPRESENTATION BY CENDANT OR ITS
AFFILIATES THAT THE PROJECTIONS WILL PROVE TO BE CORRECT.
THIS RELEASE INCLUDES CERTAIN NON-GAAP FINANCIAL MEASURES AS DEFINED UNDER SEC
RULES. AS REQUIRED BY SEC RULES, WE HAVE PROVIDED A RECONCILIATION OF THOSE
MEASURES TO THE MOST DIRECTLY COMPARABLE GAAP MEASURES, WHICH IS CONTAINED IN
THE TABLES TO THIS RELEASE AND ON OUR WEB SITE AT WWW.CENDANT.COM.
MEDIA CONTACT: INVESTOR CONTACTS:
Elliot Bloom Sam Levenson
212-413-1832 212-413-1834
Henry A. Diamond
212-413-1920
<Page>
# # #
Tables Follow
<Page>
Table 1
Cendant Corporation and Subsidiaries
SUMMARY DATA SHEET
(Dollars in millions, except per share data)
<Table>
<Caption>
2003 2002 % CHANGE
---- ---- --------
INCOME STATEMENT ITEMS FOR THIRD QUARTER
Net Revenues $ 5,062 $ 3,839 32%
Pretax Income (A) 738 379 95%
Income from Continuing Operations 486 250 94%
EPS from Continuing Operations (diluted) 0.47 0.24 96%
BALANCE SHEET ITEMS AS OF SEPTEMBER 30, 2003 AND DECEMBER 31, 2002
Total Corporate Debt (Excluding Upper DECS) $ 5,419 $ 5,976
Cash and Cash Equivalents 1,004 126
Total Stockholders' Equity 9,955 9,315
Net Debt to Total Capitalization Ratio 34.6% 41.9%
CASH FLOW ITEMS FOR THIRD QUARTER
Net Cash Provided by Operating Activities $ 1,061 $ 1,047
Free Cash Flow (B) 1,019 524
Net Cash Provided by (Used in) Management and Mortgage
Program Activities (C) 48 (61)
Payments Made for Current Period Acquisitions, Net
of Cash Acquired (36) (324)
Net Debt Repayments (444) (336)
Net Repurchases of Common Stock (128) (64)
INTEREST COVERAGE RATIOS FOR THIRD QUARTER
Total EBITDA $ 951 $ 617
Non-program related Interest Expense, net 75 68
Interest Coverage 13 to 1 9 to 1
REPORTABLE OPERATING SEGMENT RESULTS
</Table>
<Table>
<Caption>
THIRD QUARTER % CHANGE
------------------- ---------------------
NET REVENUES 2003 2002 AS REPORTED ORGANIC (D)
- ------------ ---- ---- ---------- -----------
Real Estate Services $ 1,998 $ 1,331 50% 45%
Hospitality 696 671 4% 5%
Travel Distribution 424 432 (2%) (6%)
Vehicle Services 1,574 1,085 45% --
Financial Services 370 322 15% (21%)
--------- ---------
Total Reportable Segments 5,062 3,841 32% 14%
Corporate and Other -- (2) *
--------- ---------
Total Company $ 5,062 $ 3,839 32%
========= =========
EBITDA
Real Estate Services $ 436 $ 59 639% 629%
Hospitality 189 204 (7%) (8%)
Travel Distribution 119 129 (8%) (2%)
Vehicle Services 187 143 31% --
Financial Services 62 122 (49%) (50%)
--------- ---------
Total Reportable Segments 993 657 51% 48%
Corporate and Other (E) (42) (40)
--------- ---------
Total Company 951 617
Less: Non-program related depreciation
and amortization 129 121
Non-program related interest expense, net 75 68
Early extinguishment of debt 4 4
Amortization of pendings and listings 5 45
--------- ---------
Pretax Income (A) $ 738 $ 379 95%
========= =========
</Table>
- ---------
* Not meaningful.
(A) Referred to as "Income before income taxes and minority interest" on the
Consolidated Condensed Statements of Income presented on Table 2.
(B) See Table 7 for the underlying calculations and reconciliations.
(C) Included as a component of Free Cash Flow. This amount represents the
net cash flows from the operating, investing and financing activities of
management and mortgage programs.
(D) See Table 8 for underlying calculations.
(E) Principally reflects unallocated corporate overhead.
<Page>
Table 2
CENDANT CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(In millions, except per share data)
<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
--------------------- -------------------
2003 2002 2003 2002
---- ---- ---- ----
REVENUES
Service fees and membership-related, net $ 3,516 $ 2,799 $ 9,476 $ 7,299
Vehicle-related 1,538 1,034 4,211 2,905
Other 8 6 49 34
-------- ------ -------- --------
Net revenues 5,062 3,839 13,736 10,238
-------- ------ -------- --------
EXPENSES
Operating 2,596 2,008 7,010 4,701
Vehicle depreciation, lease charges and interest, net 651 523 1,865 1,532
Marketing and reservation 491 379 1,312 1,059
General and administrative 358 301 1,038 876
Non-program related depreciation and amortization 129 121 387 337
Non-program related interest, net:
Interest expense, net 75 68 234 194
Early extinguishment of debt 4 4 58 42
Acquisition and integration related costs:
Amortization of pendings and listings 5 45 12 239
Other 15 11 30 24
-------- ------ -------- --------
Total expenses 4,324 3,460 11,946 9,004
-------- ------ -------- --------
INCOME BEFORE INCOME TAXES AND MINORITY INTEREST 738 379 1,790 1,234
Provision for income taxes 248 121 596 414
Minority interest, net of tax 4 8 17 16
-------- ------ -------- --------
INCOME FROM CONTINUING OPERATIONS 486 250 1,177 804
Income from discontinued operations, net of tax -- -- -- 51
Loss on disposal of discontinued operations, net of tax -- -- -- (256)
-------- ------ -------- --------
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE 486 250 1,177 599
Cumulative effect of accounting change, net of tax (293) -- (293) --
-------- ------ -------- --------
NET INCOME $ 193 $ 250 $ 884 $ 599
======== ======= ======== =======
EARNINGS PER SHARE
BASIC
Income from continuing operations $ 0.48 $ 0.24 $ 1.15 $ 0.79
Cumulative effect of accounting change (0.29) -- (0.28) --
Net income 0.19 0.24 0.87 0.59
DILUTED
Income from continuing operations $ 0.47 $ 0.24 $ 1.13 $ 0.77
Cumulative effect of accounting change (0.28) -- (0.28) --
Net income 0.19 0.24 0.85 0.58
WEIGHTED AVERAGE SHARES
Basic 1,013 1,039 1,019 1,014
Diluted 1,039 1,058 1,039 1,043
</Table>
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Table 3
(page 1 of 2)
CENDANT CORPORATION AND AFFILIATES
SEGMENT REVENUE DRIVER ANALYSIS
(REVENUE DOLLARS IN THOUSANDS)
<Table>
<Caption>
THIRD QUARTER
-------------------------------------------
2003 2002 % Change
----------- ----------- ----------
REAL ESTATE SERVICES SEGMENT
REAL ESTATE FRANCHISE
Closed Sides - Domestic 620,567 562,645 10%
Average Price $ 220,748 $ 197,645 12%
Royalty and Marketing Revenue (A) $ 213,310 $ 180,614 18%
Total Revenue $ 222,410 $ 187,639 19%
REAL ESTATE BROKERAGE
Net Revenue from Real Estate Transactions (B) $ 1,240,620 $ 1,005,057 23%
Other Revenue $ 11,054 $ 9,610 15%
Total Revenue $ 1,251,674 $ 1,014,667 23%
RELOCATION
Service Based Revenue (Referrals, Outsourcing, etc.) $ 81,657 $ 78,710 4%
Asset Based Revenue (Home Sale Closings and Financial Income) $ 37,562 $ 38,642 (3%)
Total Revenue $ 119,219 $ 117,352 2%
MORTGAGE
Production Loans Closed to be Securitized (millions) $ 21,121 $ 9,870 114%
Other Production Loans Closed (millions) $ 6,473 $ 5,149 26%
Production Loans Sold (millions) $ 19,228 $ 9,156 110%
Average Servicing Loan Portfolio (millions) $ 125,244 $ 108,333 16%
Production Revenue $ 428,206 $ 207,209 107%
Gross Recurring Servicing Revenue $ 112,096 $ 103,173 9%
Amortization and Impairment of Mortgage Servicing Rights (C) $ (282,285) $ (420,781) *
Hedging Activity for Mortgage Servicing Rights $ 18,295 $ 25,460 *
Other Servicing Revenue (D) $ (1,064) $ 3,433 *
Total Revenue (C) $ 275,248 $ (81,506) *
SETTLEMENT SERVICES
Title and Appraisal Units 156,401 120,464 30%
Total Revenue $ 131,396 $ 93,299 41%
HOSPITALITY SEGMENT
LODGING
RevPAR $ 30.97 $ 29.99 3%
Weighted Average Rooms Available 485,491 517,903 (6%)
Royalty, Marketing and Reservation Revenue $ 108,828 $ 112,981 (4%)
Total Revenue $ 123,124 $ 128,175 (4%)
RCI (E)
Average Subscriptions 2,954,236 2,884,272 2%
Average Subscription Fee $ 58.63 $ 57.68 2%
Subscription Revenue $ 43,305 $ 41,588 4%
Timeshare Exchanges 445,922 459,864 (3%)
Average Exchange Fee $ 160.65 $ 144.02 12%
Exchange Fee Revenue $ 71,638 $ 66,228 8%
Total Revenue $ 146,179 $ 148,187 (1%)
FAIRFIELD RESORTS
Tours 164,880 150,057 10%
Total Revenue $ 237,807 $ 230,761 3%
TRENDWEST RESORTS
Tours 109,863 105,005 5%
Total Revenue $ 157,663 $ 141,834 11%
VACATION RENTAL GROUP
Cottage Weeks Sold 132,148 130,178 2%
Total Revenue (F) $ 31,807 $ 22,658 40%
- -----------------
* Not meaningful.
(A) Includes intercompany royalties paid by Real Estate Brokerage.
(B) Net of intercompany royalties paid to Real Estate Franchise.
(C) The 2002 amounts include $275 million of impairment related to
reductions in interest rates and accelerations in loan repayments, as
well as an update to the Company's loan prepayment model, all of which
occurred during third quarter 2002. There was no impairment recorded in
third quarter 2003.
(D) Includes net interest expense of $16 million for both 2003 and 2002.
(E) Includes weeks and points members.
(F) The 2003 amount includes the revenue of a company acquired in October
2002. Accordingly, third quarter 2002 revenue is not comparable to the
current period amount.
<Page>
Table 3
(page 2 of 2)
CENDANT CORPORATION AND AFFILIATES
SEGMENT REVENUE DRIVER ANALYSIS
(REVENUE DOLLARS IN THOUSANDS)
THIRD QUARTER
-------------------------------------------------
2003 2002 % Change
------------ ---------- ----------
TRAVEL DISTRIBUTION SEGMENT
Galileo Domestic Booking Volume (000's)
Air (A) 20,578 20,382 1%
Car/Hotel 4,487 4,491 --
Galileo International Booking Volume (000's)
Air (A) 42,428 44,262 (4%)
Car/Hotel 1,286 1,237 4%
Galileo Worldwide Booking Volume (000's)
Air (A) 63,006 64,644 (3%)
Car/Hotel 5,773 5,728 1%
Galileo Revenue $379,277 $395,485 (4%)
Travel Services On-line Gross Bookings (000's) $288,252 $223,871 29%
Travel Services Off-line Gross Bookings (000's) $128,539 $116,527 10%
Total Revenue (B) $423,968 $432,080 (2%)
VEHICLE SERVICES SEGMENT
AVIS
Rental Days (000's) 15,784 16,619 (5%)
Time and Mileage Revenue per Day $ 41.21 $ 40.21 2%
Average Length of Rental (stated in Days) 3.77 3.94 (4%)
Total Revenue $705,475 $715,191 (1%)
BUDGET (C)
Car Rental Days (000's) 8,380 8,193 2%
Time and Mileage Revenue per Day $ 35.06 $ 35.09 --
Average Length of Rental (stated in Days) 4.50 4.51 --
Car Rental Revenue $330,035 (D)
Truck Rental Revenue $162,364 (D)
Total Revenue $492,399 (D)
VEHICLE MANAGEMENT AND FUEL CARD SERVICES
Average Fleet (Leased) 313,858 318,725 (2%)
Average Number of Cards (000's) 3,833 3,657 5%
Service Based Revenue $ 58,824 $ 50,103 17%
Asset Based Revenue $317,282 $319,578 (1%)
Total Revenue $376,106 $369,681 2%
FINANCIAL SERVICES SEGMENT
Insurance/Wholesale-related Revenue $155,472 $134,653 15%
Individual Membership Revenue (E) (F) $203,178 $155,561 *
Trilegiant Royalty Paid to Cendant (G) $ 11,829 $ 2,829 *
Total Revenue (F) $369,965 $322,109 *
</Table>
-----------------
* Not meaningful.
(A) The 2002 amounts have been revised to reflect segments on a basis
consistent with 2003 and with industry standards.
(B) The 2003 amount includes the revenues of businesses acquired during or
subsequent to the third quarter of 2002. Accordingly, third quarter 2002
revenue is not comparable to the current period amount.
(C) The methodology for calculating Budget's revenue drivers currently
differs from the methodology used for the Avis business as Budget has not
yet been integrated onto our system. Due to the methodology difference,
Budget's length of rental will be longer than Avis' based on a rental of
the same duration and, accordingly, Budget's time and mileage per day
will be lower than Avis' for the same rental. The integration is expected
to occur by the end of second quarter 2004.
(D) The operations of this business were acquired subsequent to the third
quarter of 2002.
(E) Includes membership fee revenues that the Company continues to collect
from the members that existed as of July 2001, as well as membership fee
revenues (including the royalty paid to Cendant) generated from
Trilegiant's members.
(F) As of July 1, 2003, Cendant began consolidating the results of Trilegiant
pursuant to a new accounting standard. Accordingly, third quarter 2002
revenues are not comparable to the current period amounts.
(G) Reflects only Cendant's royalty received from Trilegiant on revenues
generated by Trilegiant's members (those who joined the clubs and
programs subsequent to July 2001). As the Company now consolidates
Trilegiant (as of July 1, 2003), this royalty is eliminated in
consolidation.
<Page>
Table 4
CENDANT CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(IN BILLIONS)
<Table>
<Caption>
AS OF AS OF
SEPTEMBER 30, 2003 DECEMBER 31, 2002
------------------ -----------------
ASSETS
Current assets:
Cash and cash equivalents $ 1.0 $ 0.1
Other current assets 3.2 3.3
---------- ----------
Total current assets 4.2 3.4
Property and equipment, net 1.7 1.8
Goodwill, net 10.9 10.7
Other non-current assets 4.3 4.9
---------- ----------
Total assets exclusive of assets under programs 21.1 20.8
Assets under management and mortgage programs 20.0 15.1
---------- ----------
TOTAL ASSETS $ 41.1 $ 35.9
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 0.7 $ --
Other current liabilities 5.3 5.0
---------- ----------
Total current liabilities 6.0 5.0
Long-term debt, excluding Upper DECS 4.7 5.6
Upper DECS 0.9 0.9
Other non-current liabilities 1.2 0.9
---------- ----------
Total liabilities exclusive of liabilities under programs 12.8 12.4
Liabilities under management and mortgage programs 18.3 13.8
Mandatorily redeemable preferred interest in a subsidiary -- 0.4
Total stockholders' equity 10.0 9.3
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 41.1 $ 35.9
========== ==========
<Page>
Table 5
CENDANT CORPORATION AND SUBSIDIARIES
SCHEDULE OF CORPORATE DEBT (A)
(IN MILLIONS)
EARLIEST MANDATORY SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31,
REDEMPTION DATE MATURITY DATE 2003 2003 2003 2002
- ------------------ ------------- ------------ ------- -------- ------------
NET DEBT
December 2003 December 2003 7 3/4% notes $ 229 $ 229 $ 229 $ 966
February 2004 February 2021 Zero coupon senior convertible
contingent notes (B) 428 425 422 420
May 2004 May 2021 Zero coupon convertible debentures (C) 7 7 401 857
November 2004 November 2011 3 7/8% convertible senior debentures (D) 804 804 804 1,200
August 2006 August 2006 6 7/8% notes 849 849 849 849
January 2008 January 2008 6 1/4% notes 796 796 796 -
May 2009 May 2009 11% senior subordinated notes 337 398 435 530
March 2010 March 2010 6 1/4% notes 348 348 348 -
January 2013 January 2013 7 3/8% notes 1,190 1,190 1,189 -
March 2015 March 2015 7 1/8% notes 250 250 250 -
December 2005 Revolver borrowings -- -- -- 600
Net hedging gains (E) 80 163 81 89
Other 101 86 88 90
-------- ------ ------ ------
5,419 5,545 5,892 5,601
Plus: Mandatorily redeemable preferred interest -- 375 375 375
-------- ------ ------ ------
Total corporate debt, excluding Upper DECS 5,419 5,920 6,267 5,976
Less: Cash and cash equivalents 1,004 627 580 126
-------- ------ ------ ------
4,415 5,293 5,687 5,850
Plus: Upper DECS 863 863 863 863
-------- ------ ------ ------
NET DEBT $ 5,278 $ 6,156 $ 6,550 $ 6,713
======== ======= ======= ========
TOTAL CAPITALIZATION
Total Stockholders' Equity $ 9,955 $ 9,776 $ 9,529 $ 9,315
Net Debt (per above) 5,278 6,156 6,550 6,713
-------- ------ ------ ------
TOTAL CAPITALIZATION $ 15,233 $ 15,932 $ 16,079 $ 16,028
======== ======= ======= ========
NET DEBT TO TOTAL CAPITALIZATION RATIO 34.6% 38.6% 40.7% 41.9%
</Table>
- --------------
(A) Amounts presented herein exclude debt under management and mortgage
programs.
(B) Each $1,000 principal amount is convertible into 33.4 shares of CD common
stock during the fourth quarter of 2003 if the average price of CD common
stock exceeds $21.45 during the stipulated measurement periods. The
average price of CD common stock at which the notes are convertible
increases on a quarterly basis by a stipulated percentage. Redeemable by
the Company after February 13, 2004. Holders may require the Company to
repurchase the notes on February 13, 2004, 2009 and 2014. Issued at a
discount resulting in a yield-to-maturity of 2.5%.
(C) Each $1,000 principal amount is convertible into 39.08 shares of CD
common stock if the average price of CD common stock exceeds $28.15
during the stipulated measurement periods. Redeemable by the Company
after May 4, 2004. Holders may require the Company to repurchase the
debentures on May 4, 2004, 2006, 2008, 2011 and 2016. The 2003 year to
date redemptions eliminated approximately 33 million shares of potential
dilution.
(D) Each $1,000 principal amount is convertible into 41.58 shares of CD
common stock during 2003 if the average price of CD common stock exceeds
$28.59 during the stipulated measurement periods. The average price of CD
common stock at which the debentures are convertible decreases annually
by a stipulated percentage. Redeemable by the Company after November 27,
2004. Holders may require the Company to repurchase the debentures on
November 27, 2004 and 2008. The 2003 year to date repurchases eliminated
approximately 16 million shares of potential dilution.
(E) As of September 30, 2003, represents $213 million of realized gains
resulting from fair value hedges that will be amortized by the Company to
reduce future interest expense, partially offset by $133 million of mark
to market adjustments on current fair value interest rate hedges.
<Page>
Table 6
CENDANT CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(IN MILLIONS)
<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------- ---------------------
2003 2002 2003 2002
----------- ---------- --------- ---------
OPERATING ACTIVITIES
Net cash provided by (used in) operating activities exclusive of management
and mortgage programs $ 1,048 $ 680 $ 2,366 $ (1,595)
Net cash provided by operating activities of management
and mortgage programs 13 367 1,059 1,958
---------- --------- --------- ----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 1,061 1,047 3,425 363
---------- --------- --------- ----------
INVESTING ACTIVITIES
Property and equipment additions (111) (96) (309) (235)
Net assets acquired, net of cash acquired, and acquisition-related payments (99) (392) (234) (1,015)
Proceeds from stockholder litigation settlement trust -- -- -- 1,410
Proceeds from disposition of business, net of transaction-related payments -- (25) -- 1,175
Proceeds received on asset sales 34 6 120 9
Other, net 19 (9) 88 (33)
---------- --------- --------- ----------
Net cash provided by (used in) investing activities exclusive of management
and mortgage programs (157) (516) (335) 1,311
---------- --------- --------- ----------
Management and mortgage programs:
Net investment in vehicles (251) (674) (1,821) (1,854)
Net timeshare receivables and inventory 160 (1) 127 (85)
Net relocation receivables 36 (25) (56) 40
Net mortgage servicing rights, related derivatives and
mortgage-backed securities (600) (1) (519) (413)
---------- --------- --------- ----------
(655) (701) (2,269) (2,312)
---------- --------- --------- ----------
NET CASH USED IN INVESTING ACTIVITIES (812) (1,217) (2,604) (1,001)
---------- --------- --------- ----------
FINANCING ACTIVITIES
Proceeds from borrowings -- -- 2,588 3
Principal payments on borrowings (444) (336) (3,215) (1,462)
Issuances of common stock 121 6 247 102
Repurchases of common stock (249) (70) (710) (197)
Other, net -- (12) (86) (30)
---------- --------- --------- ----------
Net cash used in financing activities exclusive of management
and mortgage programs (572) (412) (1,176) (1,584)
---------- --------- --------- ----------
Management and mortgage programs:
Proceeds from borrowings 8,945 2,070 22,570 9,425
Principal payments on borrowings (8,216) (2,025) (21,041) (9,212)
Net change in short-term borrowings (38) 230 (276) 194
Other (1) (2) (10) (8)
---------- --------- --------- ----------
690 273 1,243 399
---------- --------- --------- ----------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 118 (139) 67 (1,185)
---------- --------- --------- ----------
Effect of changes in exchange rates on cash and cash equivalents 10 28 (10) 12
Cash provided by discontinued operations -- -- -- 74
---------- --------- --------- ----------
Net increase (decrease) in cash and cash equivalents 377 (281) 878 (1,737)
Cash and cash equivalents, beginning of period 627 486 126 1,942
---------- --------- --------- ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 1,004 $ 205 $ 1,004 $ 205
========== ========= ========= ==========
</Table>
<Page>
Table 7
CENDANT CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF FREE CASH FLOWS
(IN MILLIONS)
Free Cash Flow is useful to management and the Company's investors in
measuring the cash generated by the Company that is available to be used to
repurchase stock, repay debt obligations, pay dividends and invest in future
growth through new business development activities or acquisitions. Free
Cash Flow should not be construed as a substitute in measuring operating
results or liquidity. Such metric may not be comparable to similarly titled
measures used by other companies and is not a measurement recognized under
generally accepted accounting principles. A reconciliation of Free Cash Flow
to the appropriate measure recognized under generally accepted accounting
principles (Net Cash Provided by Operating Activities) is presented below.
<Table>
<Caption>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------- --------------------
2003 2002 2003 2002
---------- ---------- -------- ---------
Pretax income $ 738 $ 379 $ 1,790 $ 1,234
Addback of non-cash depreciation and amortization:
Non-program related 129 121 387 337
Pendings and listings 5 45 12 239
Tax refunds (payments), net 107 (7) 58 (77)
Working capital (A) 83 (133) 199 (431)
Capital expenditures (111) (96) (309) (235)
Other 20 276 40 (40)
Management and mortgage programs (B) 48 (61) 33 45
---------- ---------- -------- ---------
FREE CASH FLOW BEFORE STOCKHOLDER LITIGATION PAYMENTS 1,019 524 2,210 1,072
Stockholder litigation payments -- -- -- (1,440)
---------- ---------- -------- ---------
FREE CASH FLOW 1,019 524 2,210 (368)
Current period acquisitions, net of cash acquired (36) (324) (80) (867)
Payments related to prior period acquisitions (63) (68) (154) (148)
Net repurchases of common stock (128) (64) (463) (95)
Net proceeds from (payments related to) disposition of business -- (25) -- 1,175
Investments and other 29 12 (8) 25
Net repayments of borrowings (444) (336) (627) (1,459)
---------- ---------- --------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (PER TABLE 6) $ 377 $ (281) $ 878 $(1,737)
========== ========= ========= =========
</Table>
- ---------------
(A) The nine months ended September 30, 2003 include approximately $200
million of proceeds received from the termination of interest rate swaps
on corporate debt instruments. The Company reset these hedge positions to
create a desired balance between its floating rate debt and floating rate
assets.
(B) Cash flows related to management and mortgage programs may fluctuate
significantly from period to period due to the timing of the underlying
management and mortgage program transactions (i.e., timing of mortgage
loan origination versus sale). For the three months ended September 30,
2003 and 2002, the net cash flows from the activities of management and
mortgage programs is reflected on Table 6 as follows: (i) net cash
provided by operating activities of $13 million and $367 million,
respectively, (ii) net cash used in investing activities of $655 million
and $701 million, respectively, and (iii) net cash provided by financing
activities of $690 million and $273 million, respectively. For the nine
months ended September 30, 2003 and 2002, the net cash flows from the
activities of management and mortgage programs is reflected on Table 6 as
follows: (i) net cash provided by operating activities of $1,059 million
and $1,958 million, respectively, (ii) net cash used in investing
activities of $2,269 million and $2,312 million, respectively and
(iii) net cash provided by financing activities of $1,243 million and
$399 million, respectively.
RECONCILIATION OF FREE CASH FLOW TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
(In millions)
<Table>
<Caption>
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- ---------------------
2003 2002 2003 2002
--------- ------- -------- --------
FREE CASH FLOW (PER ABOVE) $ 1,019 $ 524 $ 2,210 $ (368)
Cash (inflows) outflows included in Free Cash Flow but not reflected in
Net Cash Provided by Operating Activities:
Investing activities of management and mortgage programs 655 701 2,269 2,312
Financing activities of management and mortgage programs (690) (273) (1,243) (399)
Capital expenditures 111 96 309 235
Proceeds received on asset sales (34) (6) (120) (9)
Reductions to Net Cash Provided by Operating Activities but not
reflected in Free Cash Flow:
Funds released from stockholder litigation settlement trust (a) -- -- -- (1,410)
Other -- 5 -- 2
---------- ------- ------- --------
NET CASH PROVIDED BY OPERATING ACTIVITIES (PER TABLE 6) $ 1,061 $ 1,047 $ 3,425 $ 363
========== ======= ======= ========
<Caption>
PROJECTED 2003
(FULL YEAR)
-----------------
FREE CASH FLOW $ 2,500
Cash (inflows) outflows included in Free Cash Flow but not reflected in
Net Cash Provided by Operating Activities:
Investing and financing activities of management and
mortgage programs 2,250
Capital expenditures 465
Proceeds received on asset sales (130)
---------
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 5,085
=========
</Table>
- ----------------
(a) Represents payments made by the Company to the stockholder litigation
settlement trust in 2001. Such funds were then released directly from the
trust in 2002 to pay off a portion of the Company's stockholder
litigation settlement liability. The extinguishment of the liability was
reported as a reduction to net cash provided by operating activities
during 2002 but is not reflected in Free Cash Flow during 2002, as such
amount did not represent payments made by the Company during 2002.
<Page>
Table 8
CENDANT CORPORATION AND SUBSIDIARIES
ORGANIC GROWTH BY SEGMENT
(IN MILLIONS)
Organic growth represents the results of our reportable operating segments
excluding the impact of acquisitions, dispositions and other items that would
affect the comparability of the period over period results. See Table 1 for the
reported results of each of our operating segments.
<Table>
<Caption>
REVENUES EBITDA
THIRD QUARTER THIRD QUARTER
------------------------------- -------------------------------
2003 2002 %* 2003 2002 %*
-------- -------- --------- --------- ---------- ---------
Real Estate Services (A) $1,938 $1,334 45% $ 436 $ 60 629%
Hospitality (B) 657 628 5% 153 167 (8%)
Travel Distribution (C) 408 432 (6%) 126 129 (2%)
Vehicle Services (D) 1,082 1,084 -- 143 144 --
Financial Services (E) 256 322 (21%) 61 122 (50%)
------- ------- ------- --------
Total Reportable Segments $4,341 $3,800 14% $ 919 $ 622 48%
======= ======= ======= ========
</Table>
- ----------
* Amounts may not calculate due to rounding in millions.
(A) Includes reductions to revenue and EBITDA growth of $63 million and
$1 million, respectively, primarily related to the acquisition of
real estate brokerage businesses during or subsequent to third
quarter 2002. The 2002 amounts reflect a $275 million provision for
impairment of the Company's mortgage servicing rights asset related
to reductions in interest rates and accelerations in loan
repayments, as well as an update to the Company's loan prepayment
model, all of which occurred during third quarter 2002. There was no
impairment recorded in third quarter 2003.
(B) Includes increases to revenue and EBITDA growth of $4 million and $1
million, respectively, primarily related to the acquisition of a
European vacation rental company (October 2002), the acquisition of
FFD Development Company, LLC (February 2003) and the consolidation
of Sierra Receivables Funding Corporation (September 2003, pursuant
to FASB Interpretation No. 46).
(C) Includes a reduction to revenue growth of $16 million and an
increase to EBITDA growth of $7 million primarily related to the
acquisitions of Lodging.com (August 2002), Trip Network, Inc. (March
2003), Neat Group (May 2003) and several national distribution
companies in Europe during or subsequent to third quarter 2002.
(D) Includes reductions to revenue and EBITDA growth of $491 million and
$45 million, respectively, primarily related to the November 2002
acquisition of certain assets of Budget Group, Inc.
(E) Includes a reduction to revenue growth of $114 million and an
increase to EBITDA growth of $1 million primarily related to the
consolidation of Trilegiant Corporation (July 2003, pursuant to FASB
Interpretation No. 46).