Flight Centre set for more growth

30 Oct 2012, 4:24 pm   -   Source: AAP
Travel agent Flight Centre says it is on track to achieve its profit growth target for 2012/13. (AAP)

Travel agent Flight Centre says it is on track to achieve its profit growth target for 2012/13. (AAP)

Flight Centre says it will continue to expand its network and is on track to reach targeted profit growth for the 2012/13 financial year.

Travel agent Flight Centre says that despite the soft global economy, it plans to expand its number of outlets worldwide and hire more staff.

Flight Centre also said on Tuesday that trading in the first few months of the current financial year had been mixed but that the company was on track to achieve its profit growth target for 2012/13.

Managing director Graham Turner told shareholders at the company's annual general meeting in Brisbane that in the 2011/12 financial year, Flight Centre's global shop numbers grew five per cent to 2,362, and staff numbers lifted six per cent to 12,130.

"This year, we expect to grow our global shop network and sales force by six to eight per cent, which will see us employ an additional 1,000 sales staff and open our 2,500th shop and business," Mr Turner said.

"Growth will generally be organic in our existing markets, although we will consider small bolt-on acquisitions from time to time."

Mr Turner said preliminary figures for the four months to October suggested that the company was performing in line with its annual growth target of five to eight per cent.

If this trend continued for the full year, Flight Centre would achieve a profit before tax (PBT) between $305 million and $315 million, compared to the record $290.4 million PBT in the prior year.

"While it is still early days in 2012/13, first quarter trading results and October projections indicate that we are currently tracking in line with the full-year target," Mr Turner said.

"Overall results were reasonable in July and August, but below our expectations in September.

"Early indications suggest that we have regained some momentum in October."

Mr Turner said global economic conditions remained uncertain but cheap international airfares continued to stimulate Australian travel overseas.

However, this had contributed to a downturn in Australian domestic tourism, which was Flight Centre's biggest individual travel segment.

Corporate business was growing at a faster rate than the leisure market.

Flight Centre said its businesses in the United States and the United Kingdom were growing.

Flight Centre was aiming for earnings before interest and tax of $10 million to $15 million in the US, with losses in the first half of the financial year likely to be followed by profits during the seasonally stronger second half.

Shares in Flight Centre were eight cents lower at $26.64.

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