Flight Centre is confident that low airfares and growth in its overseas operations can boost profit this financial year.
Managing director Graham Turner forecast an underlying profit increase of around 10 per cent in the current financial year, amid global uncertainty.
That would take underlying profit for financial 2012 to about $188 million, from the $170.7 million in 2010/11.
“There is a level of uncertainty for a whole range of reasons but we’re confident we can build on the profit from this year, barring any major misfortunes,” Mr Turner said.
“Airfare pricing, particularly in the Australian dollar market, we’re pretty happy that it’s going to remain fairly consistently good value.”
The Brisbane-based travel agent said its underlying result was a record, 19.6 per cent higher than in 2009/10, on record sales and with positive earnings in all 10 of its operating countries for the first time.
Shares in Flight Centre gained 67 cents, or 3.7 per cent, to close at $18.66. The stock rose from Monday’s one-year low of $17.99.
“Australia is our profit powerhouse at this stage but the other countries are becoming more important,” Mr Turner said.
The travel agency chain on Tuesday posted a net profit for 2010/11 of $139.8 million, slightly down from $139.9 million in the prior year to June 30.
Revenue was four per cent higher at $1.86 billion, with total transactions up 12 per cent at $12.2 billion.
Flight Centre declared a final dividend of 48 cents, fully franked, up from 44 cents in 2009/10.
Mr Turner said expectations for the company were especially high in the UK after a disappointing 2010/11 financial year, but admitted trading conditions remained difficult offshore.
“The US, same as the UK, their economies are still a bit of a mess and they will be for some time, so being able to trade this profitably in these investor environments is something that’s not that easy,” Mr Turner said.
In a statement on Tuesday, the company said its result was two per cent above the top-end of its initial guidance of an underlying profit before tax of between $220 million and $240 million, and in line with the $243 million to $247 million range announced on 15 July.
The company said it expected a pre-tax profit of between $265 million and $275 million, excluding abnormal items for the full financial year.
