Corporate Travel Management produces revenue gains in most major markets

The global business travel group will pay a 5c a share dividend for the first time since Covid-19 struck after strong gains in revenue.

Global business travel group Corporate Travel Management will pay a 5c a share dividend for the first time since Covid-19 struck, after reporting strong revenue gains in its 2022 financial results.

While Europe, North America and Australia and New Zealand achieved strong revenue gains, Asia dragged the group’s financial performance for the 2022 financial year, according to the results released on Wednesday morning.

CTM retained 97 per cent of its clients during the pandemic and held $127m corporate cash.

The company swung to underlying EBITDA of $59.8m in the 2022 financial year, from a loss of $7.2m last year, adding that it has remained profitable since early last year.

“The group is recovering faster than the broader corporate travel market through increased market share and 97 per cent client retention,” CTM said.

Speaking from his Brisbane base, CTM managing director Jamie Pherous said his clients were embracing the opportunity to return to face-to-face connectivity following the removal of most border and travel restrictions around the world.

However, Mr Pherous conceded the travel industry faces unprecedented resourcing shortfalls with challenges to service levels, airport and airline capacity.

“Addressing this challenge within our operations remains the group’s number one priority as it moves into the new financial year,” he said.

“There’s more cancellations, more people are having to reschedule which is more inconvenient,” Mr Pherous said.

“Everything is taking longer per booking in this country, it is no ones fault. I can’t do anything about it, I can’t help the airports, however what I can do is resource up.”

CTM has hired 950 new staff during this financial year principally from outside the travel industry. Mr Pherous said he had deliberately hired staff who had very high customer management skills and were good at dealing with crises.

“We are targeting people from industries that are used to high customer service and high disruption management and 15 per cent of our entire Australian workforce has come through that program,” he said.

Super paradise beach on Mykonos island in Greece. Picture: Getty

Most regions have recovered strongly, except Asia particularly in the fourth quarter as Covid-19 became endemic. Revenues dropped 8 per cent to $17.3m in the 2022 financial year from $18.9m a year earlier.

Mr Pherous said he would turn Asian operations around by boosting his Singapore operations and opening up in Japan to support his growing base of clients. “We are buoyed by the fact that last Friday Hong Kong reduced quarantine requirements for locals and we have seen a 20 per cent increase in bookings.”

“We need quarantine removed and we know from that experience of our other three regions in CTM that eliminating quarantine is the key catalyst for recovery.”

In Australia and New Zealand, revenues jumped 63 per cent to $68.3m in the 2022 financial year, up from $42m the previous year. North American revenues grew 127 per cent to $217.7m in the 2022 financial year, up from $96m last year.

CTM nearly doubled its revenue in Europe to nearly $84m from $42m.

Net profit after tax for the quarter was over 82 per cent of pre-Covid-19 records. “We are buoyed by that,” Mr Pherous added.

The group will pay its unfranked dividend to shareholders on October 5.

CTM shares were down 3 per cent to $20.88 on the ASX late Wednesday morning.