March 1, 2024

CTM returns to profit due to pandemic recovery

Pandemic recovery in Europe and the US has helped Corporate Travel Management (CTM) make a rapid return to underlying profitability.

The Brisbane-based TMC today announced a AU$13.6m June quarter underlying EBITDA profit, representing a AU$19.1m turnaround on the previous quarter.

Positive second half underlying EBITDA of AU$8.1m helped reduce its underlying EBITDA loss to AU$7.3m for the full year.

CTM acquired Travel and Transport (T&T) in November 2020 and says North American and Europe currently generate close to 80% of its revenues.

Managing Director, Jamie Pherous said: “We returned to positive underlying profit in the second half because of a rapid turnaround in fourth quarter activity in North America and Europe. These regions have made significant progress in vaccine roll-outs and reopening the economy, which gives us reason to be optimistic about FY22.

“We continue to see encouraging signs that momentum is building in these regions. July 2021 has delivered a record revenue result post-Covid.

“We have successfully integrated the T&T team into the CTM business, and aligning our operating culture, strategic vision and client focus has allowed us to capitalise on the rebound in travel activity and grow our exposure to the world’s largest travel market.”

In a trading update today, CTM said domestic travel is quickly recovering in the UK and the trend is expected to accelerate across Europe after the summer.

Thanks to a strong AU$12.3m contribution in the second half, CTM Europe turned a first half loss into an underlying AU$10.1m EBITDA profit for the full year.

CTM’s Australia and New Zealand region remained profitable, reporting revenue and other income of AU$42.0m and underlying EBITDA of AU$7.7m, despite continued border closures.

The TMC said lockdowns and the closure of Sydney as a travel hub are limiting the national recovery but the business remains resilient, experiencing strong recovery in volumes when border restrictions have been lifted, with domestic travel activity in New Zealand currently over 150% of pre-Covid levels.

It said the trading environment in the Asia region remains “challenging because of the reliance on international travel”.

“While CTM is growing market share in Asia, the region is expected to remain marginally loss-making until planned travel bubbles are opened,” it said.