STATEMENT TO THE AUSTRALIAN SECURITIES EXCHANGE – JULY 20, 2023
Flight Centre Travel Group Upgrades Profit Guidance
FLIGHT Centre Travel Group (FLT) today upgraded its 2023 fiscal year (FY23) profit guidance.
Based on preliminary trading data, FLT now expects to report underlying earnings before interest, tax, depreciation and amortisation (EBITDA) between $295million and $305million for the 12 months to June 30, 2023.
The new midpoint, $300million, represents:
- A 7 per cent increase on the midpoint in the company's previously targeted range of underlying EBITDA between $270million and $290million; and
- A $483million turnaround on the underlying $183million FY22 loss
Total transaction value (TTV) for FY23 is expected to be in the order of $22billion, almost 115 per cent growth on the prior year (FY22: $10.3billion) and the company's second strongest full year result behind FY19 ($23.7billion).
FLT's global corporate travel business has continued to outperform, delivering record TTV during FY23 in a market that has generally improved but has yet to fully recover to pre- pandemic levels.
Corporate TTV for FY23 is expected to reach $11billion, which represents more than 20 per cent growth on the business's previous TTV record of $8.9 billion (FY19).
- Gradual recovery in client activity following the removal of COVID-related travel restrictions; and
- The multi-billion-dollar pipeline of new accounts won across both the FCM and Corporate Traveller brands during the pandemic
Global leisure TTV for FY23 is expected to be in the order of $10billion, following a strong and consistent recovery during the year's second half (2H).
"Overall, we are pleased with our continued recovery as demand has generally rebounded solidly across both our leisure and corporate travel businesses," FLT managing director Graham Turner said.
"In corporate, we have delivered record TTV while investing significantly for the future by securing large volumes of new accounts, expanding our sales force and introducing innovative new platforms and products for our customers, which should lead to stronger returns in the years ahead.
"In leisure, we are emerging from the pandemic as a more productive, more efficient and more diverse business with a strong brand stable, enhanced capability and efficient and productive models that are now starting to achieve scale benefits.
“During FY23, we also invested in our luxury travel collection through the Scott Dunn acquisition early in the 2H and, more recently, the luxperience events business to bolster our presence in a very attractive leisure sector.”
"Looking ahead, our expectations are that leisure travellers will continue to prioritise holidays and experiences over other areas of discretionary spending, as we have seen in the past and as evidenced by the consistent year-on-year growth in outbound travel in large and important markets like Australia.
"In corporate, we expect that the large volume of new business that we continue to win – both from competitors and accounts that were previously unmanaged – will offset the impact on TTV flowing from lower-than-normal client spend."
FLT will release audited FY23 accounts on Wednesday, August 30.
FCM is one of the world’s largest travel management companies and a trusted partner for thousands of national and multi-national organisations, including many household brands, Fortune, and FTSE 100 companies. With a 24/7 reach in over 100 countries, FCM’s agile and flexible technology anticipates and solves client needs supported by expert teams who provide in-depth local knowledge and duty of care as part of the ultimate personalised business travel experience. While as the flagship corporate travel arm of the ASX-listed Flight Centre Travel Group, FCM is able to deliver the best market-wide rates, unique added-value benefits, and exclusive solutions for its clients to support their business travel requirements. A recognised leader in the travel tech space, the company has debuted several proprietary client solutions over the last 12 months including a new omni-channel platform featuring a ‘first of its kind’ customised end-to-end user experience and FCM Booking, an innovative option to traditional OBTs. Alongside its travel management services, the company also provides specialist services through FCM Consulting and FCM Meetings & Events to service the broader needs of its clients. Discover the alternative at www.fcmtravel.com