Starfish Travel Corporation

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Business travel is still increasing.

Business travel is still increasing.

The FLIGHT Centre Travel Group (FLT) increased its profit forecast for the 2023 fiscal year (FY23). Based on early trading data, FLT now anticipates reporting underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) for the 12 months ending June 30, 2023, in the range of $295 million and $305 million.

The new midpoint, $300,000,000, stands for:

a 7% increase over the company’s previously anticipated range of underlying EBITDA between $270 million and $290 million;

a $483 million profit on a $183 million loss in the preceding fiscal year 22
Total transaction value (TTV) is anticipated to reach $22 billion in FY23, representing a nearly 115 percent increase over FY22’s TTV of $10.3 billion and the second-best full-year performance for the company, behind FY19’s (23.7 billion).

In a market that has generally improved but has not yet fully recovered to pre-pandemic levels, FLT’s global corporate travel business has continued to outperform, delivering record TTV during FY23.

The business’s corporate TTV is anticipated to increase by more than 20% from its previous TTV record of $8.9 billion (FY19) to $11 billion in FY23.

This illustrates:

gradual improvement in client activity after the removal of travel restrictions related to COVID; and

the pandemic’s multibillion-dollar pipeline of new business won by the FCM and Corporate Traveller brands

Following a robust and sustained recovery during the year’s second half (2H), global leisure TTV for FY23 is anticipated to be in the range of $10 billion.

FLT managing director Graham Turner said, “Overall, we are pleased with our continued recovery as demand has generally rebounded solidly across both our leisure and corporate travel businesses.

“In corporate, we have produced record TTV while making significant investments for the future by securing a lot of new accounts, growing our sales force, and introducing cutting-edge new platforms and products for our customers, which should produce stronger returns in the years to come.

In the leisure industry, we are emerging from the pandemic as a more productive, efficient, and diverse company with a strong brand stable, enhanced capability, and efficient and productive models that are now beginning to achieve scale benefits.

In order to strengthen our position in a highly appealing leisure market, we also made investments in our luxury travel collection during FY23 through the early 2H Scott Dunn acquisition and, more recently, the Luxperience events business.

As evidenced by the consistent year-over-year growth in outbound travel in significant and significant markets like Australia, we anticipate that leisure travellers will continue to prioritise vacations and experiences over other areas of discretionary spending.

“In corporate, we expect that the large volume of new business we continue to win both from competitors and accounts that were previously unmanaged – will offset the impact on TTV flowing from lower-than-normal client spend.”

“Business travel continues to grow in a post-pandemic world,” said Bertrand Saillet, managing director of FCM Travel in Asia. Given that Asia was the last region to reopen, despite the challenging economic conditions there, our enterprise and large market customers are thriving.

“Our internal data indicates that business travel has increased by over 200% year over year (01 January to 30 June 2022/2023) as a result of the high demand from corporations in our key Asian markets, such as Singapore, Hong Kong, and India.

Along with a high customer retention rate of 99% on average across Asia, this includes strong account wins from industries like manufacturing, professional scientific & technical services, banking, finance, and insurance.

Face-to-face meetings are the main driver of business travel. Singapore, the United Kingdom, and the United States are the top three international locations for business travellers from Asia.Travel is more often a necessity for businesses than a luxury expense. Meetings, events, and conferences are being attended again by businesspeople. The Meeting & Events division of FCM India has reportedly grown by more than 200%.

The average number of days required for advance purchases has increased across Asia, with Japan and Hong Kong both seeing increases of 7 and 13 days, respectively.Travel has never been more important for landing contracts and for both recruiting and retaining staff, with unemployment remaining low and business competition on the rise.

Source- Travel daily

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