Record half for Flight Centre as evolution continues

Record half for Flight Centre as evolution continues
By admin


Flight Centre has reported a record profit before tax of $155 million for the six months to December as the company continued its transition from travel agent to travel retailer.

The result represents a 19.7% increase on its former record of $129.5 million PBT achieved in the first half of the 2012/13 financial year.

Australia was the key contributor to the results, delivering record first half earnings before interest and tax.

Growth was seen across both the corporate and leisure travel sectors as the company boosted its marketing spend and brought new products to market, according to managing director Graham Turner.

"Generally, we have started the year well and, at the same time, continued our evolution from a leisure and corporate travel agent to an innovative best-in class travel retailer," he said.

The strategic plan to deliver this transition which was unveiled in 2012/13 continued over the six month period. New developments in this area included the Welcome Aboard program for novice agents, a focus on new "Hyperstores" which opened in Australia, the US and the UK and enhancements to its “blended” distribution approach including the deployment of a larger 24/7 sales force to field customer calls.

"We have also continued to expand our footprint and strengthen our global sales network, with the company creating an additional 1100 fulltime roles during the past year," Turner said.

“Over the past four years, we have added more than 4,000 people to our workforce.” 

Flight Centre opened its 2500th store in July 2013 and hit 2,643 stores by December – an 8.2% increase over the 12 month period.

For the full year, the company is standing by its profit guidance of a PBT between $370 million and $385 million – an 8-12% increase on the underlying 2012/13 result.

"While we are making sound progress and first half trading results are promising, it is too early to amend full year guidance," Turner said.

He highlighted the growth potential in all markets, with "organic" growth to be complemented by "strategic acquisition opportunities". Acquisitions are likely to be businesses that can be vertically integrated, he added. 

Meanwhile, FLT will continue to work towards its “Killer Theme” – its evolution from travel agent to “world class travel retailer”.

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