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SYDNEY - Australian travel agents Flight Centre said today its New Zealand result disappointed after it posted a 51 per cent jump in June year net profit to A$120.82 million ($140.9 million).
The New Zealand profit results were "disappointing" the company said, though "signs of improvement were evident".
"The overall NSW business and the corporate travel buinesses in both Australia and New Zealand generally performed below expectations," the company said.
The former private equity target promised 10 per cent to 15 per cent transaction growth in fiscal 2008.
Profit growth would echo that, the company said.
"FLT (Flight Centre) expects to achieve 10-15 per cent growth in total transaction value and will target bottom line profit growth in line with this ... for the 12 months to June 30, 2008," it said.
"Based on the momentum gained during 2006/07 and a good first month's trading in 2007/08, FLT believes this goal is achievable."
In the 2006 financial year, Flight Centre reported a net profit of A$79.91 million, up four per cent on 2005.
The result was described as "average" by Graham Turner at the time.
Revenue from ordinary activities grew 15 per cent to A$1.15 billion.
The company also announced a final dividend of 46 cents, bringing the full year dividend to 66 cents, up 27 per cent.
Flight Centre said the strong profit growth was driven by an improved second half sales performance.
"After a sluggish first half that saw TTV (total transaction value) and revenue increase by 10 per cent and nine per cent respectively," the company said.
"The stronger second half performance helped generate 14 per cent TTV growth to A$8.9 billion and 15 per cent revenue growth to A$1.15 billion for the full year."
Earnings per share grew 51 per cent to A$1.28.
Flight Centre said its South African, UK, North American and Indian businesses performed strongly.
Costs associated with the failed privatisation of Flight Centre came to A$3.4 million, the company said.
A private equity buy-out of the travel agent was canned in July, after an offer by Pacific Equity Partners was deemed inadequate by an independent expert.
The deal valued the company at about A$1.6 billion, below Ernst & Young's valuation of A$1.9 billion to A$2 billion.
Shares in Flight Centre rose with the today's strong profit result.
Flight Centre was up 25 cents, or 1.33 per cent, to A$19.05 on the news.
- AAP
