Flight Centre posts earnings comeback thanks to record corporate travel

flight centre

Flight Centre has posted its second highest level of sales off the back of a record performance in corporate travel.

The company reported a $485 million turnaround in earnings to $301.6 million, with international flight capacity set to hit 90 per cent of pre-pandemic levels by the end of the year.

“Flight Centre also strongly supports yet-to-be-approved plans by other airlines, including Qatar Airways and Turkish Airlines, to increase traffic to Australia to boost tourism and to deliver cheaper airfares to travellers,” said Flight Centre chief executive Graham Turner.

FLT’s corporate travel business continued to out-perform, comfortably out-pacing the broader industry recovery and delivering record TTV during FY23. The $11 billion FY23 result represented 96 per cent YOY growth and an almost 25 per cent increase on the previous TTV record in FY19 ($8.9 billion).

“Put simply, travel is back and back in a big way for our corporate customers across all of Australia, both departing and arriving,” said Melissa Elf, Flight Centre Corporate’s managing director ANZ.

“The region has thrived now that most travel obstacles are a thing of the past, the USA has dropped its vaccination entry requirements, and China has reopened to the world.

“This is the trend we have continued to see throughout the year, with what we thought was an initial sugar rush, actually turning out to be the new normal. Corporates are now seeing travel as more of a necessity than a luxury, a true gateway to business growth, employee retention, and survival.”

While economic growth is forecast to remain subdued in Australia for the rest of the year, research has revealed that SMEs will not halt business travel for the remainder of the year at least, with site visits and industry events topping the list of reasons for businesses to invest in company travel.

The survey uncovered that the majority of Australian SMEs (91 per cent) will maintain their travel this year, even if the economy slows, with 32 per cent saying they will maintain travel for events and conferences. Only nine per cent indicated they would not travel at all.

“As well as continuing to travel, we were pleased to see so many companies still had the economic confidence to attend conferences and events, which requires additional financial outlay, beyond flights and accommodation,” said Tom Walley, Corporate Traveller’s Australian-based global managing director.

“Those activities are excellent for networking, learning, and a great opportunity to work toward business growth.”

A fifth (20 per cent) of respondents said their people will travel to attend training or professional development sessions, while 17 per cent said their business is more effective by doing face-to-face meetings, and 10 per cent are keeping business travel to keep their staff motivated.

“The results demonstrate that companies recognise there’s a bounty of opportunities for Australian businesses which still invest in corporate travel, whether its team building, attending international conferences, or an exciting incentive or reward for staff,” said Walley.