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What will Flight Centre Travel Group's finances look like in 2018? Turner answers

2017 may not have delivered the financial results Flight Centre was expecting, but Managing Director, Graham Turner, believes 2018 will thanks to the group's transformation plans and international businesses.

2017 may not have delivered the financial results Flight Centre was expecting, but Managing Director, Graham Turner, believes 2018 will thanks to the group’s transformation plans and international businesses.

Speaking at the group’s Annual General Meeting earlier this month, Turner admitted that he wasn’t “particularly happy” with last year’s results despite earning an underlying profit before tax of $330 million and achieving a record total transaction value.

He explained that while outside factors were part of the problem last year, they weren’t solely to blame, as areas of the business “simply did not deliver the results that were expected of them”.

Ensuring this doesn’t affect 2018’s finances, Graham said the group is focusing on progressing with its transformation program designed to provide all parts of the business with “stronger foundations” that’ll increase their chances to achieving new goals.

money feature

Part of the transformation program includes increasing the Flight Centre’s digital commerce through valuable acquisitions, investing in growing brands, globalising its air, land and IT business as well as reducing costs and improving network efficiencies. Click here for more on the program.

Outside of the program, Graham said the group also believes its international businesses will be key to growth next year, particularly those in North America, Europe, the Middle East and Africa.

So far in the 2018 financial year, those regions together have delivered 30 percent of the group’s profit and almost 35 percent of TTV, while Asia has returned a “modestly” profit during the first quarter.

Over in Oceania, New Zealand’s results for the first quarter were described as “fairly good”, while Australia’s first half profit is expected to be slightly down on last year.

Graham attributed the slow growth in Australia to “important system changes within the business”.

Flight Centre

“These changes, which we have spoken about previously, will inevitably lead to some distraction and disruption for our people in- store while the upgrades are underway.”

Graham Turner, Flight Centre Travel Group Managing Director

“Improvement is expected during the second half, when the new systems will be fully deployed, productivity will start to improve and as we start to grow our sales force again.

“At the moment, our focus is on training our people and embedding the new system, rather than replacing any departing leisure travel staff.”

He continued, saying that on a positive note, international airfares had stabilised and while they’re still cheap for travellers, they’re “comparable in price to those” from the last financial year.

“It is early days in the 2018 fiscal year, but we are making solid progress and are well placed to grow both top and bottom-line results.”

Graham Turner, Flight Centre Travel Group Managing Director

“The investments we’ve made in recent years have provided us with a platform for further cost-effective and scalable growth across our core business units and we have started to see some of the benefits.”

READ: Transformation plans & profits over at FLT

READ: Flight Centre beats Air New Zealand in Rugby re-match

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