Just a few months into 2022, Flight Centre Travel Group’s (FLT) global corporate business – one of the world’s largest corporate travel managers – is reporting a positive trajectory that is says will likely see a return to profitability as early as March-April. The optimistic outlook is driven by pent-up demand, growing momentum and adaption to the new norm, says the company.
In a statement to the Australian Securities Exchange last week, the Group’s corporate business collectively rose more than 50% above January levels at February mid-month. The company also revealed an escalation in activity in February as the world rebounded after omicron.
The positive improvements were seen across all regions, reported the company, and followed almost 150% total transaction value (TTV) growth in the first half of its fiscal year.
The company says its Corporate Traveller (for SME) and FCM (larger corporations) divisions combined to produce about 60% of FLT’s first-half sales (fiscal year runs from 1 July-30 June each year).
“We are encouraged to see recovery across the global corporate sector shifting upwards, with client demand and bookings emphatically on the rise as more countries open their borders to international travellers once again,” said Chris Galanty, Global CEO of Flight Centre Corporate. “The improved performance of our FCM and Corporate Traveller businesses is indicative of renewed confidence in our reinvigorated products and services, and testament to the incredible resilience of our clients who are looking to make up for lost time and reconnect in real-life for successful business development in 2022.”
Looking ahead, while average spend is unlikely to return fully in the near-term, the company believes that the global rebound will gather pace throughout 2022 and bullishly predicts its corporate TTV can now pass peak 2019 (monthly) levels during the 2023, assuming market conditions improve.
Average client spend (market recovery) is expected to reach 60-75% of traditional levels as restrictions ease and as a result of pent-up demand for face-to-face meetings; as well as material TTV flowing through from the large pipeline of accounts won during the past two years.
“While there may be further challenges to overcome, our investment, preparation and commitment means that we are primed and well placed for recovery. I am optimistic about the corporate business and its future, and look forward to when the impact from COVID on travel has disappeared,” added Galanty.
Geographically, the EMEA (Europe, Middle East, and Africa) and Americas businesses, more than tripled sales during the period, leading tracking 90% and 55% respectively above January levels to lead the recovery.