Flight Centre is overhauling its shops, staff and services in a bid to keep up its run of record profits.
Stronger sales and improved margins helped boost the travel agency group’s 2012/2013 profit by 23 per cent to $246 million, up from $200 million the previous year.
Managing director Graham Turner said barring any “terribly disastrous” developments, the company was aiming for a pre-tax profit of between $370 million and $385 million for the 2013/14 financial year.
To do this, the company will continue to move from a travel agent “middle man” to expert “travel retailer”, chief operating officer Ms Melanie Waters-Ryan said.
The ongoing strategy includes transforming stores into travel retail hubs to make them less like office spaces where customers come simply to make bookings.
Staff will also have behind-the-scenes “travel gurus” at hand to boost their expertise.
It’s hoped this practical know-how, along with 24/7 accessibility, will help the company stay profitable as some consumers choose to bypass agents altogether by booking their own trips online.
“There’s still a long way to go, but we are starting to use the web as our biggest shopfront,” Ms Waters-Ryan said.
In keeping with the digital theme, consultants will also be encouraged to get out from behind their desks and step through travel options with customers on iPads.
Looking to 2014, a lower Australian dollar should also have a positive impact on business by generating higher profit contributions from its international arms.
Mr Turner also said it won’t stop regular Australians from holidaying overseas – just force them to opt for four star treatment instead of five to keep budgets in check.
The company also noted it was still awaiting the outcome of a competition law test case brought against it by the Australian Competition and Consumer Commission (ACCC).
The ACCC alleged Flight Centre attempted to induce Singapore Airlines, Malaysian Airlines and Emirates airlines to enter into price-fixing arrangements so it could maintain its lowest price guarantee without losing money.
But Mr Turner said any potential fines “won’t be very onerous” and are unlikely to affect 2014 results.
The company declared a fully-franked final dividend of 91 cents, up 28 per cent on the 2012 final dividend of 71 cents.
It takes the full year distribution to $1.37 a share.
Traders rewarded Flight Centre’s strong results in afternoon trade, with shares up $3.08, or 6.9 per cent, at $47.68.
