Flight Centre looks to raise $700m to overcome coronavirus downturn

Flight Centre is looking to raise $700 million from investors as part of a group wide plan to manage the fallout from the ongoing coronavirus related travel bans and shutdowns.

The company had secured an extra $200 million loan from existing lenders and is also considering selling its Melbourne CBD office. It also recently laid off 6000 of its global sales and support staff and closed more than 40 per cent of Australian shops in an effort to reduce annual operating costs by $1.9 billion by the end of July.

“It is, without question, the most challenging period we have encountered in over 30 years in business and it is inevitable that some businesses across our industry will fail, given the significant loss of revenue that they will be experiencing now and for at least the next few months,” said managing director Graham Turner.

“We’re confident that this will, even with almost no income over the next 12 to 18 months, this’ll give us enough money to be able to take advantage when travel restrictions are lifted.”

In a separate statement to Flight Centre employees, Turner said the decision to stand down staff was “incredibly difficult”.

“We are determined to ensure this is a temporary measure and it will be reviewed weekly,’ he said.

“People are the heart and soul of our company and those who are stepping down remain a very important part of our business and of our future – we will welcome them back with open arms when restrictions are lifted and as demand starts to improve.

“With this funding in place, you can be confident that we will overcome the challenge that coronavirus poses and will retain our historic strengths, our culture, our growth focus, our commitment to innovation and, importantly, our team of people who will be there to support you as borders reopen and as airline capacity returns.”