Flight Centre Travel Group Half-Year FY24 Financial Results
Flight Centre Travel Group (ASX:FLT) achieved an AUD$106million underlying profit before tax (PBT) for the half year to December 31, 2023.
The leisure business’s AUD$60million underlying PBT exceeded pre-pandemic levels and was:
• Circa 30-times the AUD$2million FY23 first half (1H) result; and
• Double the AUD$30million FY19 1H underlying PBT.
Underlying corporate PBT increased 53 per cent to AUD$93million, during another period of healthy, organic growth and ahead of the Productive Operations initiative’s benefits being realised.
Total transaction value (TTV) increased 15 per cent to AUD$11.3billion, delivering FCTG's second strongest start to a year (behind only the FY20 1H).
Corporate TTV increased 16.8 per cent to a record AUD$5.9billion, as the business again achieved new sales milestones and comfortably outpaced the broader corporate travel sector’s recovery.
Leisure TTV increased 18 per cent to AUD$5.2billion, with scale benefits being achieved across a diverse mass market, luxury, complementary and independent brand range.
Comments by Steve Norris, Flight Centre Travel Group Managing Director, EMEA
“We have seen strong corporate growth across Europe in the first half of the financial year with our flagship large market division FCM Travel in the UK up 17 per cent and Germany seeing a rise of 25 per cent – with the Netherlands leading the way having seen a 175 per cent increase.
“In another exciting step forward for the region, we successfully relaunched our FCM Meetings & Events business across the UK, United Arab Emirates, France, and Sweden – a sector that has seen strong recovery as companies return to face-to-face interactions and collaborations.
“Taking into consideration external factors, it’s pleasing to see airline yields remaining high, with an expectation that these are unlikely to reduce significantly – that’s despite pockets of industrial action still affecting a handful of countries across Europe.
“Looking ahead, we’re looking forward to our Productive Operations initiative continuing its roll-out across Europe, large customer wins beginning to trade in the third quarter of 2024, and all customers will be successfully migrated onto the FCM Platform by the end of June.”
Comments by Chris Galanty, Global CEO, Flight Centre Corporate:
“Our corporate businesses have had a strong start to H1 of FY24 globally, contributing 52 per cent of Flight Centre Travel Group’s (ASX:FLT) total transaction value, with our proven organic growth model again delivering record overall sales.
"We’ve also achieved new milestones in the four geographic regions of Australia and New Zealand, the Americas, Europe, and Middle East and Africa and Asia.
“These record results, built on high customer retention rates and large volumes of new account wins, were achieved in a sector that has only recovered to circa 70 per cent of pre-COVID transaction volume levels, pointing to our healthy market-share growth.
“At the end of January 2024, our corporate brands had secured new accounts with projected annual spends of circa $1.3billion, with FCM Travel typically winning customers from competitors, and Corporate Traveller securing a mix of unmanaged and smaller, managed accounts.
“We continue to make strides in the technology space with mass adoption of our Corporate Traveller Melon platform in the USA and Canada – with fast growth also being seen in the UK. FCM Platform has also seen successful growth with all existing customers anticipated to be migrated this year.
“We’re also progressing our corporate AI Centre of Excellence and that has seen new features added to the suite of products already available that have improved the customer experience and increased our operational productivity.
“Aside from technology, we’ve also been working tirelessly towards clear and consistent strategies that have been successfully executed globally, with these strategies initially focusing on ‘Grow to Win’, but now also include productive operations.
“We look forward to continuing this momentum into H2 of FY24 – with more exciting advancements to come later in the year – and some major customers to be onboarded globally.”
