Flight Centre Surges Most in Seven Months in Sydney After Record Profit
Flight Centre Ltd., Australia’s largest travel agency, surged the most in more than seven months after the company announced a record full-year profit and said earnings would improve next year.
Shares of Brisbane-based Flight Centre jumped 3 percent to close at A$19 in Sydney trading, after earlier rising as much as 4.6 percent, the most since Jan. 20. The company posted net profit after tax of A$139.9 million ($124 million) in the year ended June 30 and said it’s targeting an increase in profit before tax to between A$220 million and A$240 million in the next financial year.
“Despite the fact that global economic conditions have not yet fully recovered, customer enquiry was at strong levels and more tickets were sold than ever before,” Flight Centre Managing Director Graham Turner said in a statement today. “Within our businesses globally, we see ongoing growth prospects in all countries.”
Air travel is recovering from the worst global recession since World War II as businesses become more willing to pay for employee flights and holidaymakers book overseas vacations. The number of passengers traveling in premium seats rose 16.6 percent in June from a year earlier, while the number of economy travelers rose 9.5 percent, according to International Air Transport Association data released Aug. 16.
An expansion of its retail outlets, a “modest recovery” in airplane yields and more corporate travel, as well as better earnings from its India and U.S. units, will help Flight Centre increase its profit next year, the company said in its statement.
Analysts had been expecting profit before tax of A$226 million in 2011, according to the average of nine estimates compiled by Bloomberg.