Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Lisa Rapuano - Lane Five Capital Management.
Lisa Rapuano – Lane Five Capital Management
I was wondering if you could comment on your intensions for use of free cash flow in the coming year. Are there still a 90% return to shareholders on that?
Jeff Thomas
Lisa the back part of your question trailed off, I heard the first part of that comment on use of cash flow in 2009, I didn’t hear the second part?
Lisa Rapuano – Lane Five Capital Management
Just whether the intension was to continue to return it to shareholders and what you’re thinking about dividend versus share repurchase?
Jeff Thomas
Yes, thanks for your question Lisa Rapuano. Again, we like our position right now with our cash on our balance sheet. We think having cash on the balance sheet at this time during tough economic times is a good thing. We continue, not only on a quarterly basis but on a monthly basis to evaluate repurchases as well as our dividend policy and will continue to do that and I think right now, during these times we will analyze that more than we ever have.
Operator
Your next question comes from Greg McKinley – Dougherty & Co.
Greg McKinley - Dougherty & Co.
Guys, I’m wondering, if you could comment a little bit about how you view the pricing end margin environment for 2009 travel relative to the environment you’ve been operating in the last couple of years. Just from a currency, head wind perspective as well as just general cost of delivery be it coach rental and fuel charges, air fares etc, is that giving you an ability to earn similar margin dollars off of lower priced itineraries or nothing force to raise prices to maintain margin. Could to talk a little bit about that?
William Sennett
Sure. I think we look at this, one is pricing of our 2009 programs done in 2008. Obviously those were done in a different environment than we are today, at the same time we are also entering into contracts with our overseas vendors for the delivery of those programs. We do have and as you’ve seen from our comments on the unhedged foreign currency position is that we have been able to get some positive margin expansion due to decreased cost overseas.
At the same time where very fairly hedged or we’re unhedged on our foreign currency needs at this time. There is other thing such as air cost that are continuing to come down in certain environments such as fuel surcharge, but we also see in certain areas they are also going up. So it is a little bit volatile right now, but we see opportunities that will help alleviate some of the pressures as we have decreased enrollments. Going into 2010, is where I think the first time we would be able to take some of these advantages into our pricing.
- To read the full transcript on Seeking Alpha, click here »
