Flight Centre results: Profit up 23%, huge increase in OTA sales

Flight Centre is the next up to unveiled its half-yearly results for 2018, and to be quite honest our head is spinning a bit.

So, please bear with us as we break this all down for you.

First and foremost, Flight Centre (FLT) has revealed a record global sales, with a $139.4 million profit before tax (PBT) for the period.

This is an increase of 23.2 per cent compared to the same period last year.

As well as this, the total transactional value (TTV) exceeded the unprecedented FY17 result by more than $800m, roughly 8.7 per cent.

Most interesting, however, is the growth in online.

Online sales again increased strongly, with FLT’s specialist OTAs (BYOjet, StudentUniverse and Aunt Betty) achieved a growth of 27 per cent.

Speaking on the results, FLT Managing Director Graham ‘Skroo’ Turner said: “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.”

“We have also made sound progress in executing operational strategies and transformation initiatives that have been developed to fast-track revenue growth and curb costs,” he added.

Skroo also said the company will finish the year with higher than expected profits.

“The mid-point in this new range – $372.5m – is 13 per cent higher than the underlying FY17 result and within reach of the record $376.5m achieved in FY14.”

The company pinned some of its success the to the new in-store system (GDS) which almost 7000 leisure consultants migrated to last year.

TTV has increased by 8.7 per cent to $10.16 billion and has more than doubled during the past eight years.

Revenue has increased by 5.4 per cent to $1.37b.

Skroo added: “While Australia was again the largest contributor to group results, FLT’s overseas businesses predominately drove overall growth – generating a record $38.2m.”

“For the first time, the US business was profitable during the seasonally softer 1H, while the Canada business continued its strong improvement trajectory.”

FLT recorded 4  per cent growth in Australia-New Zealand, which surprised the company considering it had initially expected profit to be flat or down during the period.

Looking ahead, FLT admits that despite the strong growth of 1H, it is unlikely to be maintained.

“Generally, the company expects 1h operational trends to continue, with overseas businesses, particularly the large North American and EMEA operations, likely to drive FY18 profit growth.”

“The smaller Asia Businesses are also on track to deliver solid year-on-year improvement, following their positive start to the year.”

He finished: “In Australia and New Zealand, we are well placed to grow in the corporate sector, given the positive 1H momentum.”