Flight Centre boss Graham Turner says the travel retailer expects to break even in the second half of 2022 as the rebound in global demand for flights helps lift the company from a COVID-induced slump.
The ASX-listed travel agency upgraded its earnings guidance on Monday morning, telling investors it now expects a full-year underlying loss of between $180 million and $190 million, down from previous predictions of losses between $195 million and $225 million.
Flight Centre CEO Graham Turner said the travel recovery had exceeded expectations. Credit:Madeline Begley
Turner said the airline sector faced ongoing challenges for at the next six to 12 months but that the bounce-back in demand for corporate and leisure travel had happened faster than Flight Centre had been predicting.
“The scale of our recovery exceeded our initial expectations and meant that we should now
exceed our preliminary FY22 result target, with early trading results pointing to a breakeven
second half result and a healthy fourth quarter profit (underlying EBITDA).”
The total transaction value of flights booked through the company’s networks hit the $10 billion mark for 2022, more than double the $3.95 billion that Flight Centre processed in 2021.
The increase is due to both increased demand for flights and higher prices for a range of routes.
“[Total transaction value] recovery has, to date, been fuelled by both an uplift in demand and higher than normal ticket prices linked to a lack of airline capacity, particularly on international routes,” the company said in an update to investors.
While the company will still post a loss for the year, it expects to break even on an underlying earnings basis for the second six months of the year.
Turner said on Monday that the company was gaining market share in the corporate sector as business travel rebounds.
