Record profit and sales results for Flight Centre

Published: 22 Aug 2007

Buoyed by its second-half performance, Travel agent Flight Centre Limited has shared that its profit after tax surpassed A$100million for the first time, increasing 51 percent to A$120.8million during the 12 months to June 30.

The company, which recorded profit and sales results for the 2006/07 financial year, achieved 26 percent pre tax profit growth to $151.6million, excluding the $22.4m abnormal gain on the sale of the company’s Brisbane city headquarters.

The strong profit growth was achieved off the back of an improved second half sales performance, as evidenced by significant growth in total transaction value and revenue during the six months to June 30 2007.

After a sluggish first half that saw total transaction value (TTV) and revenue increase by 10 percent and nine percent respectively, this stronger second half performance helped generate 14 percent TTV growth to $8.9billion and 15 percent revenue growth to $1.15billion for the full year. Income margin, revenue as a percentage of TTV, increased from 12.79 percent to 12.98 percent. Earnings per share increased 51 percent to $1.28.

Managing Director Graham Turner said: “After a relatively slow start to the year, we can be pleased with our overall performance, particularly the milestone we achieved by exceeding $100million in profit after tax for the first time. While we continue to face various challenges, particularly in the areas of cost reduction and margin improvement, our performance shows that the strategies we have in place to create a strong building block for the future are gaining some traction.”

“After three years of increasing airline fuel surcharges, the absence of any significant changes in this area in 2006/07 allowed FLT to at least translate its TTV growth into tangible over-ride earnings and revenue growth.”

In Australia, TTV increased 12.5 percent to $5.5billion. UK business recorded 20 percent TTV growth to A$1.2billion, while in North America, it increased 40 percent to A$821.5 million.

The company expects to achieve 10-15 percent growth in total transaction value and will target bottom line profit growth in line with this TTV growth for the 12 months to June 30 2008.

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