European, US and Asian execs flock to Aussie travel agents

Corporate travel businesses reveal a multimillion-dollar boost as they bounce back from the Covid-19 pandemic.

Australia’s homegrown global corporate travel businesses continue to outperform with the $2.88bn Corporate Travel Management announcing a better than expected 2023 full year guidance on the back of significant client retentions and the snaring of several major contracts.

Corporate Travel Management expects full year guidance to be in the range of $165-$170 million delivering a second half earnings before interest, expense, depreciation and amortisation (EBITDA) of $113.7m to $118.7m for the second half.

Corporate Travel Management managing director Jamie Pherous said the Brisbane based group, was winning more clients.

“We are getting our scale right in North America, Europe and Asia.

“We seem to be more relevant in those markets because of our size, what we are selling to clients is compelling and as a result we are winning more customers.”

Mr Pherous said the company was doing well in the government space but was also winning corporate clients across the board.

It was expected to produce record earnings per share in the 2024 financial year on the back of several large wins in Europe, namely a $3bn contract in the UK.

Corporate Travel Management’s second half underlying EBITDA will more than double the first half result of $51.3 million, indicating strong momentum into 2024, according to the group.

Fourth quarter 2023 revenues were more than 90 per cent of 2019 revenues during covid and the company noted that it was achieving 97 pent client retention.

One of the key contracts won by Corporate Travel Management was the successful tender for the UK Home Office’s Bridging Accommodation and Travel Services which is worth just over $3bn over two years and commenced back in February.

The $4.88bn Flight Centre, which is heavily involved in both leisure and corporate travel, last week upgraded its profit guidance for the 2023 financial year announcing it expected to produce an EBITDA between $295m to $305m for the 12 months to June 30, 2023.

The $300m represents a 7 per cent increase in the company’s previously targeted range and a $483m turnaround on the $183m underlying loss produced over the previous corresponding period.

Total transaction value for 2023 is expected to be $22bn, nearly 115 per cent growth on the prior year, and the company’s second strongest full year result as global corporate travel business continued to outperform.

Meanwhile, the $448m Helloworld, Australia’s second largest travel company after Flight Centre, will acquire a 100 per cent stake in Express Travel Group given 99.75 per cent of its shareholders voted in favour of its $70m acquisition at a general meeting of shareholders on Wednesday morning.

The transaction will expand Helloworld’s retail network and is expected to see its forecast earnings for the 2023 financial year increase approximately sevenfold.

Express Travel Group operates an air ticket consolidation business as well as retail travel networks and cruise and package wholesaling from offices in Melbourne, Sydney and Auckland.

Originally published as European, US and Asian execs flock to Aussie travel agents