Flight Centre Travel Group EOFY FY23 Financial Results
Flight Centre Travel Group Records Strong Profit Turnaround During 2023 Fiscal Year
Flight Centre Travel Group (ASX:FLT) recorded a strong profit turnaround during FY23.
The diversified global travel company delivered AUD$301.6 million in underlying EBITDA for the 12 months to June 30, 2023 – an almost AUD$485 million turnaround from FY22’s AUD$183.1 million underlying loss.
The result represented a 265% YOY improvement and was above the mid-point in FLT’S upgraded, targeted profit range FY23 (AUD$295 million-AUD$305 million).
On a profit before tax (PBT) basis, the company achieved an underlying AUD$106 million profit (FY22: AUD$361 million loss) and an AUD$70 million statutory PBT (FY22: AUD$378 million loss).
FLT's corporate travel business continued to out-perform, comfortably out-pacing broader industry recovery and delivering record TTV during FY23.
The AUD$11 billion FY23 result represented 96 percent YOY growth (FY22: AUD$5.6 billion) and an almost 25 percent increase on the previous TTV record (FY19: AUD$8.9 billion).
New TTV milestones were established in all geographic segments, with the Europe, Middle East, and Africa (EMEA) business topping its previous record by 59 percent, Asia by 24 percent, the Americas by 15.6 percent, and Australia-New Zealand (ANZ) by 10.5 percent.
The Americas business was FLT’s largest corporate operation, generating 31 percent of group corporate TTV, just ahead of ANZ (30 percent), EMEA (28 percent), and Asia (11 percent).
For the full statement to the ASX, CLICK HERE.
Comments by Chris Galanty, Global CEO, Flight Centre Corporate:
“Our global corporate travel business – with flagships FCM and Corporate Traveler – has continued to outperform, delivering record Total Transaction Value (TTV) in FY23 in a market that has generally seen an improvement, but has still yet to recover fully to pre-pandemic levels.
“We’ve invested significantly for the future by focusing on customer retention and securing large volumes of new clients, in both the large market and SME segments, while expanding our sales force worldwide and introducing new innovative platforms and products for our customers globally.
“We’ve also concentrated on our people, prioritizing recruitment, training, and development ensuring we are fully equipped to help customers as dedicated travel consultants continue to be a critical facet for large businesses and SMEs when it comes to their travel management programs.
“Our grow-to-win strategy has continued momentum, our investment has seen us take huge strides forward, and we’re proud to have opened new headquarters in both New York and London this year.
“This growth focused approach has given us a real competitive advantage and enabled our duo of category-leading brands to boost market share by retaining, winning, and implementing a larger volume of business.
“We continue to be industry leaders when it comes to technology with our innovative proprietary platform for Corporate Traveler, Melon, thriving in both the UK and USA, with AI also making a real difference for our FCM customers. We’re also still proudly the only travel management company globally to have our own aggregator to provide our clients with NDC content through TPConnects.
“As the global economy remains under pressure, the corporate travel outlook is positive, evidenced by our robust performance in FY23, and supported by the Global Business Travel Association’s recent 2023 Business Travel Index™ Outlook, noting that global business travel spend is expected to surpass its pre-pandemic spending level of $1.4 trillion (USD) in 2024.
“For economies to survive, recover, and thrive – big business and SMEs must continue to travel for meetings, events, and conferences to retain staff, recruit the best talent, and win new contracts – these are just some of the factors that have played a part in such a strong corporate bounce back.”
Comments by Charlene Leiss, President of the Americas, Flight Centre Travel Group:
“Put simply, travel is back and back in a big way, for both our corporate and leisure customers across the whole of the Americas. The region has thrived now that travel obstacles are a thing of the past and the reopening of China has also had positive ramifications for the industry.
“Despite economic uncertainty, the USA remains the beating financial heart of the world and we’ve seen SMEs in particular come roaring back to travel, with Corporate Traveler USA revealing that Boston, London, Los Angeles, San Francisco and Chicago were the industry destinations of choice.
“It’s also been a landmark year for Corporate Traveler’s innovative proprietary platform, Melon, with online adoption for customers doubling since the start of the year, online transaction volume quadrupling, and a 98 percent customer satisfaction score received from our chat support.
“As for our large market business, FCM, it was a year when flagship corporates ramped up their travel once again – alongside major account wins such as Shell – and exciting innovation in the technology space with FCM Extension and advancing our use of AI for an improved customer experience.
“Another example of our industry-leading expertise is the fact we’re still the only travel management company (TMC) globally to have our own aggregator to provide our clients with NDC content through TPConnects – putting us ahead of our competitors in this ever-evolving space.
“We’re seeing that large corporations simply must travel to survive and thrive and are valuing a TMC more than ever to ensure smooth operations. Businesses in the technology, biotech, and telecoms space in particular have entrusted us with keeping them moving no matter the scenario in FY23.
“The ‘sugar rush’ theme continued in the leisure space where families and friends have been making the most of capacity returning to the market with a greater choice of who and where to fly both here at home and abroad – it has certainly been a strong summer.
“Recent figures showed total travel spending improved to 0.9 percent above June 2022 levels and was up 4.7 percent year-to-date through June 2023, with air travel demand increasing 12 percent in June, compared to the same month last year.
“We look forward to an exciting FY24 and working even more closely with our customers.”
The full ASX announcement can be viewed, HERE.
