Flight Centre expects a return to “more favourable dynamics for travellers” after reporting record performance in corporate travel, taking its total sales to their second-highest level ever.
The company reported a $485 million year-on-year turnaround in underlying earnings before interest, tax, depreciation and amortisation to $301.6 million, above the mid-point of already upgraded guidance.
Flight Centre chief executive Graham Turner said international flight capacity should return to around 90 per cent by the end of the year. Dan Peled
It will pay an 18¢ a share, fully franked dividend for the first time since the pandemic, representing 52 per cent of its $47 million net profit after tax.
The leisure and corporate travel agent said macroeconomic changes “do not appear to be significantly impacting demand” so far this financial year, with profit and sales higher than a year earlier in the first two months.
“We’ve got a reasonably significant, higher-end leisure market through travel associates and Scott Dunn in the United Kingdom and the United States and that market seems pretty resilient,” Flight Centre chief executive Graham Turner said. “Even in our mass market brands like Flight Centre, most of the international travellers tend to be mid to higher income people who probably haven’t been as affected by the economic issues.”
The company also said the strong recovery and improved outlook had given it confidence to announce a new capital management framework, through which it will re-invest in capital expenditure and, where appropriate, mergers and acquisitions, as well as pay dividends or conduct strategic buy-backs to increase earnings per share.
It expects to pay 50 per cent to 60 per cent of its after tax net
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