Fateful move that shattered travel empire Corporate Travel Management – and its high-flying CEO
He’s the high-flying Brisbane businessman who turned a two-person start up into a global travel giant, but will Jamie Pherous survive a catastrophic scandal engulfing his company?
He’s the high-flying Brisbane businessman who turned a two-person start up into a global travel giant, but will Jamie Pherous survive a catastrophic scandal engulfing his company?
With the Australian and UK governments issuing a please explain, the future of under siege Corporate Travel Management remains in doubt after a week from hell.
And it’s probably going to get worse.
The Brisbane-based global company, which covers corporate, events, leisure, loyalty and wholesale travel was founded in 1994 by accountant and managing director Jamie Pherous.
It had, by its own admission a few years ago, become the most successful travel management company in the world and boasts more than 3000 staff globally.
And Mr Pherous was a well paid CEO living the high life with a multimillion-dollar mansion in New Farm, a holiday apartment on exclusive Hastings St in Noosa and all the trappings.
But there has also been a question mark over the company’s success which critics claim appeared to defy the downturns in the market and even the Covid pandemic.
Was it good management or something else?
After last Friday’s bombshell ASX statement which included revelations – from a yet unfinished review of its books – of more than $160m in overcharging, an RBC Capital Markets research note simply said “this is far worse that we expected”.
A constant critic of the company, GCQ Funds Management co-founder Doug Tynan was more brutal saying “glimmers of truth are shining through to such a degree that even an accounting layperson can no longer turn a blind eye.”
CTM’s performance has been a constant source of conjecture among some hedge fund managers and market analysts over the past decade.
Back in 2018 when he was with VGI Partners, Mr Tynan made a 176-page presentation highlighting a multitude of red flags which focused on the company’s claims of patented technology and a global office network that he felt were not accurate.
Since then, the stock has never recovered to its previous highs, most recently trading at $16.05 – and will be in free fall if it ever trades again which is looking less likely.
Mr Tynan left VGI and co-founded GCQ Funds Management and has continued to maintain his short position on CTM – or rather bet against the stock rising.
He said CTM’s claims “just didn’t add up”
At the heart of the issue has been the annual audits which had been completed by PwC for nine years until a different auditor within the organisation picked up the alleged overcharging issue in 2024.
CTM also churned through five chief financial officers in seven years – who signed off on these PwC audits.
The timeline for when the alleged overcharging occurred is still under investigation. There is no suggestion of wrongdoing from the auditors or CFOs
In its 2025 financial year results, CTM reported 9 per cent revenue growth to $716.9m and an underlying profit of $201.7m – a 21 per cent increase.
But it fell short of expectations.
Also last year, CTM chairman Ewen Crouch told shareholders they were changing auditors “after a competitive tender” appointed Deloitte.
It was a fateful decision and it all came to a head on August 22 when the discovery of auditing errors dating back years pushed the $2.35bn company to call for a trading halt.
KPMG came in to look at the books and a month later CTM assured shareholders that any expected accounting adjustments were simple “timing” issues.
But the trading halt has progressively been extended and after bombshell revelations on November 28, the auditors will be working on the books into 2026.
What they have found is alleged serious over charging by the company in its UK operations and it expects to be in the vicinity of $162m to its UK clients including the British government.
CTM’s chief executive for the UK and Europe was also stood down on full pay and Mr Crouch dodged questions on whether it would escalate beyond a financial regulatory issue.
With the revelations there is also the risk the auditors will keep on digging and looking under every rock for problems rather than actually providing an audit sign-off.
In the latest blow, the UK and Australian governments have both waded in.
CTM holds significant contracts with both top tier ASX-listed companies like Wesfarmers and also with the federal and state governments.
The company has agreed to undertake an independent audit at the request of the Australian government to prove it hasn’t been overcharging for its services, following the UK revelations.
Britain’s Cabinet Office has revealed it’s investigating the matter, and the Greater London Authority is also reviewing its contract.
CTM was used for repatriations during the Covid pandemic and managing the asylum-seeker barge program.
The 57-year-old Mr Pherous – who began CTM as a two-person start-up – issued an “unreserved apology”.
“Our priority is to uphold the highest standards across our operations, work closely with our auditors to finalise the FY25 financial statements, and implement all necessary measures to strengthen the company,” he said.
“While this work continues, we remain firmly focused on delivering quality service to our clients across all markets.”
But his position – and that of the executive team of Mr Spence, global chief operating officer Eleanor Noonan, global chief commercial officer Ana Pedersen and global chief legal officer and company secretary Shelley Sorrenson – must be in question.
You can also throw in the board’s future as well
For CTM to get out of the hole it’s in and at least return to the sharemarket, it needs to get audited accounts into the market; provide clear guidance; and get its balance sheet in order which would likely require raising equity capital.
Meanwhile, there will be another CTM update on December 19.
Mr Tynan said that even if the company survives, there is no scenario, in his view, where either Mr Crouch or Mr Pherous will have their jobs this time next year.
“A fish rots from the head, and this is a catastrophic failure both of board responsibilities and of management,” he said.
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Originally published as Fateful move that shattered travel empire Corporate Travel Management – and its high-flying CEO
