Flight Centre Travel Group (FLT) continues its post-pandemic upward trajectory, reporting AUD$11.7 billion in total transaction value (TTV) for the first half of FY25 – up three per cent on last year and the 28th time in 30 years TTV has increased since FLT started listing results.
FLT achieved $117 million in underlying profit before tax (UPBT) in 1H FY25 for a seven per cent year-on-year uptick that is outpacing TTV growth.
FCTG’s corporate divisions reported a record TTV of $6 billion in 1H FY25, representing 143 per cent of pre-pandemic size.
Leisure brands are also more productive, efficient and profitable than pre-COVID with emerging businesses in the luxury, independent and specialist categories now capturing around 50 per cent of total leisure TTV compared to 45 per cent last year.
FCTG’s best-performing brands are Flight Centre, Corporate Traveller and FCM with luxury leisure businesses on track to contribute more than $50 million in profit this year to become the Group’s fourth major earnings driver.
Q1 versus Q2 results
FCTG CEO Graham “Skroo” Turner said the first half of FY25 was a tale of two quarters.
“TTV and profit growth rebounded after a challenging first quarter. In fact, our second quarter profit growth rate more than doubled our second quarter TTV growth rate, providing good operating leverage and momentum ahead of our key trading months,” he said.
“Our corporate business – now a materially larger business than pre-COVID – again delivered record 1H TTV and increased profit.
“Leisure TTV also increased and has subsequently reached record levels in various locations and brands in January, but profit was in line with the strong FY24 1H result, partly because of investments in the high-growth cruise sector.”
FLT continues to review underperforming businesses with a small division of its Infinity Holidays wholesale business closed after incurring around $2.5 million in trading losses in 1H FY25. This follows the closure of Discova Americas and wholesaler GoGo in FY24.
Strategic leisure priorities
For 2H FY25, FLT will focus on differentiating the Flight Centre brand as an omnichannel retailer of choice, growing its luxury sector presence (Scott Dunn, Travel Associates and Luxury Travel Collection) and expanding independents (now contributing around 20% of leisure TTV).
In addition, it aims to double cruise and tour sales after achieving almost 25 per cent growth ($500 million) in 1H FY25 and tap into new revenue streams, such as FX, differentiated e-commerce offerings and a loyalty program.
Turner said FLT is focused on the FY25 goal of a 14–26.5 per cent UPBT uplift, representing $45 to $85 million, as the company trades in a “reasonably” normal post-COVID environment with investments in AI and cruising expected to deliver strong future returns.
FLT is already set for 2H growth with a 2.3 per cent UPBT margin increase in Australia in January 2025 due to a record-breaking TTV month for the global and Australian leisure businesses, Corporate Traveller USA and Scott Dunn, which delivered a record profit.
As previously stated, FLT does not expect to achieve its initial stretch target of returning to a two per cent UPBT margin in 2025.
“Group-wide, our foundations are solid and we are well placed to deliver stronger second-half profit as volumes increase during our busier trading period,” Turner said.
“We will also continue to benefit from the synergies of being a scale offering across both corporate and leisure travel with our brand and geographic diversity both a strength and a key differentiator.”
Read the full results here.
