Corporate Travel Management wins $3bn UK Home Office contract
Corporate Travel Management will source ‘complex’ accommodation and transport for asylum seekers from around the world under a new contract which sent the group’s shares soaring.
Corporate Travel Management shares powered up more than 12 per cent on Thursday as news the Brisbane-based company had won a major $3bn contract from the UK Home Office.
The contract, which could be extended from an initial two years to three years, will see the travel management group provide bridging accommodation and travel services for asylum seekers from around the world.
According to the ASX statement the “highly complex services and logistic support … will be delivered by an already established dedicated team within Corporate Travel Management that has both the experience and specialist knowledge to support this work”.
CTM is being tasked with sourcing accommodation and transportation services for the project over the next two years, with the possibility of a one-year extension in line with ongoing demand requirements.
“It’s managing asylum seekers’ accommodation, obviously it’s a complex problem and we have the right solutions to do it much more cost effectively and with minimal disruption to local communities,” CTM managing director Jamie Pherous told The Australian.
“We already have a turnkey solution given we have managed a lot of large people movements through Covid.
“This project is fully staffed and we are ready to tackle it.”
Mr Pherous said Europe was already the company’s biggest contributor prior to this deal, however with the addition of this contract it gives the company much more confidence in the delivery of its 2024 financial year expectations.
CTM has previously given an underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of $160m to $180m for the 2023 financial year and profit before tax guidance of $120m to $140m.
Mr Pherous said the contract with the Home Office, which plays a fundamental role in the security and economic prosperity of the UK, will have a minimal impact on CTM’s 2023 financial results.
According to the ASX announcement the contract was awarded on February 26, 2023, and is located in London.
Shares in Corporate Travel Management closed up 12.16 per cent to $21.20.
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