Flight Centre Travel Group’s Corporate Business Delivers Positive Results While Achieving Cash Flow Targets

FCTG Graham 'Skroo' Turner

13 August 2020

Flight Centre Travel Group’s (FCTG) corporate business has won a record number of new customers during a challenging period for the travel industry.

FCM Travel Solutions, FCTG’s leading business travel arm has fueled the company’s revenue generation during COVID-19 lockdowns. With a strong growth trajectory, FCTG was on track to deliver more than $10billion in annual TTV before restrictions were imposed.

FCM secured new accounts with an annualised spend of USD1.3billion during FY20, with the majority of these wins coming during the second half.

Other Key Highlights from today’s ASX Announcement:

  • $1.9b cash balance as at June 30, including circa $1.15b in liquidity
    • Successfully building a longer liquidity runway
    • COVID-19 cash burn slowly - revenue above initial projections, costs at targeted levels
  • Short-term net operating cash outflow target surpassed
    • $53m net outflow in July - below the $65m monthly target and including $17m in revenue $43m outflow with net benefit of JobKeeper subsidy included
  • Underlying $475m-$525m FY20 loss expected:
    • Losses incurred from March after government imposed heavy restrictions sparked an industry-wide downturn

You can read the ASX announcement in full here »

“COVID-19 and, specifically, the government responses to it have clearly had devastating impacts on businesses worldwide and on the airline, travel, tourism and hospitality industries in particular. This has severely impacted us and our people, and some very tough decisions have been made over the past four and five months,” says FCTG Managing Director Graham Turner.

“Despite ongoing restrictions, revenue has now started to increase, particularly in Europe, and we have surpassed our initial cash flow target, thereby extending our liquidity runway.

“We have also continued to win a record amount of new corporate accounts while generating an underlying corporate profit during FY20.

“This highlights both our corporate business’s resilience and its strong future growth prospects in this large, global travel sector.”