Surging travel demand restores profit for Flight Centre in fourth quarter
The speed with which New Zealanders and Australians have resumed international travel has caught trans-Tasman travel company Flight Centre Group by surprise.
“We were confident the demand for travel would eventually come back post-Covid, but I don’t think anyone could have predicted the pace at which it has rebounded since borders have re-opened around the world,” said NZ MD David Coombes.
“Whether travelling for business or leisure – people are out exploring the world again.”
The Australian-listed company posted a loss of A$183 million for the full year, however, such has been the volume of travel bookings since Covid restrictions were lifted, it booked an underlying profit of $35 million for the fourth quarter.
In New Zealand, leisure bookings for Flight Centre Travel Group are sitting at approximately 90 per cent of pre-Covid levels and corporate bookings at approximately 70 per cent,” Coombes said.
“Considering the delays in easing travel restrictions, higher airfares, and limited airline capacity, this is remarkable.
“We are expecting global and local airline capacity to steadily increase as we move into 2023 which will allow us to provide our customers with more options and more competitive prices. This is likely to boost demand even further.”
All major geographic regions in which Flight Centre operates returned to profit in the fourth quarter, except for Asia. The global corporate and EMEA (Europe, Middle East and African) divisions returned a full-year profit.
The company’s leisure online businesses generated almost $750 million in gross transactional value over the year, with the Flight Centre Australian website accounting for almost 20 per cent of the company’s Australian turnover.
Meanwhile, Coombes said the company knows there will still be “some turbulence ahead” due to Covid waves and staff shortages worldwide, “but we are constantly evolving our technology and product offerings to support our customers through the ever-changing travel landscape”.
He sees the uncertain times as an opportunity for the group which enjoys the trust and confidence of consumers.
“It has never been more critical to have an expert on your side.”