Flight Centre once again showed who’s boss in the Australian travel market recording strong TTV growth of almost 9% and upgrading its full-year profit forecast – clearly demonstrating the importance of geographic diversity and staff productivity, which grew 7% from $481,000 to $513,000 per head over the past year.
These productivity improvements came through a combination of 3% less staff and more efficient use of technology.
“The company slowed recruitment in Australia and instead focused on rolling out its new in-store systems”.
Meanwhile all Flight Centre says all its international markets and segments are firing.
Highlights of the FLT result for the six months to Dec 31 include;
Record TTV globally and in all markets – up 8.7% to $10.16 billion
- Profit in all geographic segments
- Increase of corporate travel market share
- $139.4m profit before tax, underlying profit up 23.2%
- Upgraded forecast for financial year 2017/18
“Generally we can be pleased with our performance to date given that we are tracking at or near record levels in most key financial areas,” said MD Graham Turner.
‘We have also made sound progress in executing operational strategies and transformation initiatives to fast-track revenue growth and curb costs.”
A major part of this has been the transition of its Australian and NZ businesses from the Travelport GDS to Sabre, with the 2.5 year project now complete.
He added that revenue increased 5.4% to $1.37 billion, leading to a lower overall income margin (revenue as a percentage of TTV).
“This contraction was expected given changes in FLT’s business mix with several lower income margin sectors, including multi-national corporate travel (FCM), online leisure travel (BYOjet, Aunt Betty, Student Universe) and FX (Travel Money) growing strongly,” the company said.
FLT now expects full-year pre-tax profit will be around $372.5 million – 13% higher than the underlying FY17 results and just short of its all time record of $329.5 million in in FY14.