Shares in Flight Centre (FLT) eased yesterday, despite an upbeat outlook given at the AGM in Brisbane.
The 34c a share fall to $51.91 knocked the shares from their all time high reached on Wednesday ahead of the meeting.
So the fall might have been more a sell on the fact (like what happened to NAB shares yesterday after its profit release) by shareholders in Flight Centre who have ridden the shares higher for much of the year.
In fact Flight Centre shares have doubled in the past year as earnings have risen on the back of more Australians travelling overseas and the company produced a succession of earnings upgrades.
Yesterday’s AGM was told that the company had made a strong start to the new financial year as the number of Australians travelling overseas continues to rise, despite the weakness in the currency since May.
Shareholders were told that Flight Centre was on track to reach its forecast guidance of an 8% to 12% rise in underlying pre-tax profits this year to as much as $385 million.
Flight Centre CEO Graham Turner described trading results in the first months of the 2013-14 financial year as promising and putting the company on track to reach its earnings targets.
But he cautioned that it was still "very early days" and it would be "premature to extrapolate current growth rates over the full year".
"As we have said before, comparatives will become more difficult as the year progresses, so maintaining the current trajectory will become more challenging," he said.
FLT YTD – Flight Centre says 2013-14 has started solidly
Mr Turner said its operations in Australia – its biggest contributor to earnings – plus its UK and New Zealand businesses had been the best performers so far this year.
He also reiterated that fluctuations in the Australian dollar had not stopped Australians from travelling abroad en masse.
"Results from both our leisure and corporate businesses in Australia have improved year-on-year, with leisure currently recording stronger growth," he said.
The travel company intends to boost its global sales network by up to 10% this year.
The company revealed at the end of September that it had moved to lift its 24/7 customer contact performance by the end of the 2013.
Flight Centre said 80 travel consultants are already in place and the sales force is set to expand to 130 by December 31 as a major recruitment drive kicks in.
"The 50 new consultants will be divided between the Brisbane and Sydney Flight Centre 24/7 businesses," it said in a statement.
Flight Centre chairman Peter Morahan also told the meeting that he intends retiring this year after six years in the job. But he didn’t indicate any timing on his retirement.
The uncertainty was to allow the company time to find a successor.
