Flight Centre Flags Profit Lift
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Travel group, Flight Centre has gone all bullish about its outlook for 2017-18, forecasting not only a solid December half, but a full year profit rise of 15%.
Speaking at the company’s annual general meeting yesterday, CEO, Graham Turner said strong momentum from the second half of the 2016-17 financial year had carried into 2017-18.
“Although it is still early days in the new year, our businesses generally are performing well and are tracking towards a $120 million to $135 million underlying first half profit before tax,” Mr Turner told shareholders.
"If achieved, this will represent 6 per cent to 19 per cent growth on the $113.2 million underlying profit before tax recorded during the first half of last year."
Mr Turner said this would mean profit before tax for the full year would come in between $350 million and $380 million, which would represent growth of between 6% and more than 15% on the group’s weak 2017 results, which the veteran chief executive told shareholders were disappointing.
"Some of our businesses simply did not deliver the results that were expected of them," Mr Turner said of the 2017 year.
Mr Turner said Flight Centre's international businesses are shaping up as key growth drivers for 2018, with its North American unit and its Europe, Middle East and Africa unit on track to beat their 2017 results, when they were responsibly for 30 per cent of group profit.
But the outlook in Australia and New Zealand is weaker, as Flight Centre rolls out new systems and cuts costs. “In Australia, we currently expect first half profit will be slightly down on last year, while we make some important system changes within the business,” Mr Turner said.
“At the moment, our focus is on training our people and embedding the new system, rather than replacing any departing leisure travel staff,” he said.
Flight Centre shares were up 2% to $47.50.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.