Flight Centre’s profits stall dragged down by domestic woes

Flight Centre’s profits barely moved in the last financial year, growing just 0.1 per cent to $263.8 million for the year to June 30, 2019.

It was the company’s overseas divisions that made the most profit with its Americas business recording 44 per cent pre-tax profit growth.

The growth of Flight Centre’s overseas businesses, combined with stagnation in its domestic operations, meant that the company generated more than half its profits from offshore for the first time in its history.

Flight Centre managing director Graham Turner said he does not expect that trend to change much over the next 12 months.

“In Australia, we expect a gradual leisure sector recovery as the year progresses, as the trading climate improves and as our improvement strategies gain traction,” he said.

“While market conditions and the consumer environment remain subdued, we have seen some margin stabilisation recently.”

The company already culled almost 300 sales staff over the past financial year, and expects to close about 30 shops during the year, opening 20 new ones in different locations.