Slide 1: Half Year Results February 2005
FLIGHT CENTRE LIMITED Half Year Results 17 February 2005
Slide 2: 2005 Half Year Result
- 2005 Half Year Result ¢ $30.5m Net profit after tax * ‘Full Throttle’ project to reduce costs, improve productivity & build a better model for the future - Continue to build for future — people & shops « Australian domestic airfare booking engine on flightcentre.com.au « Launch of Australian loyal
Slide 3: 2005 Half Year Financial Performance
2005 Half Year Financia Performance 6 months 6 months Growth to to 30 Dec 2004 30 Dec 2003 % TTv $3,228m —«- $2,711m if 19% Revenue $420m $364m ‘if 16% Profit - before Tax & Goodwill $51.6m $56.4m ~ (8%) - before Tax $46.5m $51.5m © (10%) ~ after Tax $30.5m $34.1m % (11%) EPS 32.3¢ 36.5¢ & (12%) EPS
Slide 4: Financial Overview
aes Fi nan Ci al Over vi ew * Healthy TTV growth - 19.1% * GDS impact, over-accrual at June, new contract and lower rates * Operating costs increased: — Salary and wages — upstaffing, general increase in support staff — Advertising — rea! increases — FCm Travel Solutions brand launch — Depreciation
Slide 5: Bridge to Profit
ting to Profit 15.0 5 Profit $51.5M x 19.1% (TTV Growth) 10.0 4 5.0 4 9.9 (4.4) 0.0 " 0.8 7.8) | a 9.8 (5.0) 5 (2.0) (5.1) (10.0) 5 (15.0) 4 Income Margin 13.4% (11.4) LY to 13.0% TY (20.0) - : Expected Commission Galileo Service Fees _Interest Exp >19.1% Exp <19.1% Decrease to FLIGHT LY CENTRE LIMI
Slide 6: Operational Overview
Operational Overview Management focus on a more productive model Developing the competitive advantage — evolving into a sophisticated multi-channel distribution network ‘Full Throttle’ project will reduce costs & enhance productivity — Introduction of highly targeted initiatives — Focus on organisat
Slide 7: Operating Highlights
~ Operating Highlights Pie x PISS Australia @385 Retail 20% profit increase in volatile market Significant improvement in Student Flights & Escape Travel now profitable Corporate still expecting flat year Low-yield, and time consuming airfares Look & Book capability for all Australian domestic airli
Slide 8: Operating Highlights - Other Countries
~ Operating Highlights Other Countries . NZ — Low growth, operating costs & low cost Trans Tasman airfares UK - Leisure impacted by upstaffing, now well positioned, up 35% - Britannic — growth in new clients South Africa — result below expectations, overrides USA — flat performance Canada — reductio
Slide 9: FCm Acquisition - FGT
— FCm Acquisition - FGT « Acquired 51% interest in Friends Globe Travels Limited (FGTL) + India’s largest nationally owned travel business formed in 1987 * Initial investment $8.3 million likely to be completed by April 05 « FY05 TTV of $107m and EBITDA $3.2m « EPS positive and funded by cash + Futu
Slide 10: Capital Management
- Capital Management * Maintain strong balance sheet for strategic acquisitions - DPS of 22.5 cents per share increase of 10% on pcp + Payout ratio to remain at 70% of NPAT under IFRS — meaning an uplift in the payout ratio - Number of shares on issue to remain at 94 million shares as at FY04 FLIGHT
Slide 11: Full Year Outlook
| el Year Outlook « Expect result to be in line with last year * Management focus on: - Creating a lower cost & more efficient model - Becoming an effective multi-channel distribution company - Delivering initiatives that increase consultant productivity - Continuance of preferred supplier strategy
Slide 12: Shop Growth Expectations
Shop Growth Expectations June At Dec At June Full Yr % Country 2005F 2004 2004 Increase AUS 720 678 641** 79 12% NZ 138 128 128* 10 8% RSA 98 90 88 10 11% UK 90 81 82 8 10% Brit 42 42 42 0% USA 20 18 17 18% Can 124 118 115 8% Other 8 6 5™* 60% oO oO WwW O Total 1,240 1,161 1,118 122 11% *Reduction i
Slide 13: Additional Financial Information
FLIGHT CENTRE IMPTED Additional Financial Information
Slide 14: Growth Over Years
s Over 10 Yea Year Net TTV % Shop % Profit % EPS % profit ASm Growth # Growth (AT) Growth (cents) Growth margin A$,000 Dec95 1.98% 434 - 232 - 5,263 - 7.0 - Dec 96 1.84% 566 30% 284 22% 7,067 34% 9.0 29% Dec9/7 1.67% 691 22% 338 19% 7,450 5% 9.5 6% Dec 98 2.04% 812 18% 410 21% 10,510 41% 13.3 40% De
Slide 15: Key Operating Results - TTV & Revenue
Key Operating Results —” 'V & Revenue TTV TTV TTV Revenue Revenue Revenue 6 months to Dec 04 Dec 03 Growth Dec 04 Dec 03 Growth A$m Ag$m % A$m A$m %o AUS 2,068 1,741 18% 255.5 221.2 15% NZ 291 260 12% 43.8 40.0 10% RSA 170 138 24% 17.2 14.5 19% UK 241 196 23% 37.7 29.6 27% Brit 206 173 19% 24.7 23.3
Slide 16: Income Margin Results
sults Income Margin = (Revenue / TTV )* 100% 6 months to Dec 04 Dec 03 % % % chg AUS 12.4 12.7 (0.3) NZ 15.1 15.4 (0.3) RSA 10.1 10.5 (0.4) UK 15.6 15.1 0.5 Brit 12.0 13.5 (1.5) USA 14.3 15.0 (0.7) Can 14.1 15.3 (1.2) Total 13.0 13.4 (0.4) FLIGHT CENTRE LIMITED 16
Slide 17: IFRS impact on Flight Centre Limited
= FRc impact on Flight Centre Limited Amortisation of Goodwill Goodwill will no longer be amortised —potential increase in NPAT of $10m p.a. Impairment of Assets All assets subject to annual stringent impairment tests — minor or no impact Internally developed Assets Derecognise internally developed
Slide 18: Cash & Investments
18 Cash & Pees Dec 04 Dec 03 % Ag$m A$m Var Company Cash 29.1 8.9 227% Client Cash 174.4 121.5 43% Investments 211.3 213.9 (1%) Total 414.5 344.3 20.4% FLIGHT CENTRE LIMITED
Slide 19: Depreciation & Amortisation
Depreceiion & A morisation, 6 months to Dec 04 Dec 03 % A$m Ag$m chg Depreciation 16.0 12.2 31%* Amortisation - Goodwill 5.2 49 6% - Other 1.3 1.4 (9%) * 31% increase due to increase in capital expenditure relating to: Contal acquisition — travelthere.com.au Finance Project FLIGHT CENTRE LIMITED 19
Slide 20: Flight Centre
FLIGHT CENTRE LIMITED