Flight Centre Travel Group Limited · ASX:FLT
Flight Centre Travel — FY2016 Earnings Presentation
110 slides from Flight Centre Travel's earnings presentation, Aug 25, 2016
Slide 1: 2016 Full Year Results Presentation
2016 FULL YEAR RESULTS PRESENTATION 25 AUGUST 2016 For personal use only
Slide 2: Overview
OVERVIEW For personal use only • Introduction – by Haydn Long • Financial Highlights & Global Review – by Adam Campbell • Strategic Update – by Melanie Waters-Ryan • Market Conditions & Outlook – by Graham Turner • Questions • Supplementary Details
Slide 3: Introduction: FY16 Investing for Growth
INTRODUCTION: FY16 INVESTING FOR GROWTH For personal use only Strong TTV growth – 5 regions generated more than $1AUb in TTV during FY16 & FLT poised to become a $20b-a-year sales company during FY17 (20 years after 1st topping $1b) PBT (underlying) exceeded $350m for 3rd consecutive year & in line
Slide 4: Financial Highlights
For personal use only FINANCIAL HIGHLIGHTS
Slide 5: Financial Highlights: Record Sales
FINANCIAL HIGHLIGHTS: RECORD SALES For personal use only Records in all •Topped previous Regions •TTV has exceeded PCP record by $1.7b in low 20 times in 21 years yield environment •New milestones in all since listing •9.7% growth on FY15 10 regions •Has more than tripled •Highlights FLT’s since FY0
Slide 6: Financial Highlights: Diversity
FINANCIAL HIGHLIGHTS: DIVERSITY For personal use only TTV By Region Australia Americas Europe & South Africa NZ, Asia, India & UAE On average, FLT sold more than $50m worth of travel globally every day during FY16 (See Appendix 1 for additional TTV milestones)
Slide 7: Financial Highlights: Solid Profit
FINANCIAL HIGHLIGHTS: SOLID PROFIT For personal use only 3rd strongest result but down on PCP Adjustments to underlying PBT: $17.3m in gains relating to NZ head office sale ($6.3m) & ACCC refund NPAT down 3.8% $352.4m ($11m) (underlying) & underlying PBT, 4.7% (statutory) down 3.8% $AU24.7m in non-c
Slide 8: Financial Highlights: Margin
FINANCIAL HIGHLIGHTS: MARGIN For personal use only Revenue up 11.2% & increasing at a faster rate than TTV – leading to increased income margin (13.8%) Lower net margin of 1.8% – costs & investment in network enhancements affecting profit growth
Slide 9: Lower Net Margin: Contributing Factors
LOWER NET MARGIN: CONTRIBUTING FACTORS For personal use only COSTS NETWORK LOW AIRFARE PRICES UNDERPERFORMANCE ENHANCEMENTS IN SOME BUSINESSES •Growth in normal •Multi-million dollar •Reasonable dollar- •Reduced profits in operating expenses investment in based super over- Induasia ($9.2m – wages, s
Slide 10: Cost Drivers: Rent, Wages & Marketing
COST DRIVERS: RENT, WAGES & MARKETING For personal use only Rent Wages Sales & Marketing • Growth driven by • 4% people • 1.2% of TTV, network growth leading to solid expansion • Pay rises for sales enquiry • Renewals staff in UK & NZ generation typically following change • Investment in increasing
Slide 11: Cost Drivers: Network Enhancements
COST DRIVERS: NETWORK ENHANCEMENTS For personal use only Omni channel New people-related Aunt Betty launched New products – Key To Employer of Choice Brands & Diversity Network Upgrades enhancements across initiatives 7 acquisitions The World, IAPs P2P Index Greater workplace Increased ad spend to B
Slide 12: Cost Drivers: Network Enhancements
COST DRIVERS: NETWORK ENHANCEMENTS For personal use only Increased Depreciation & Amortisation Expense • Up $12m on PCP • Reflects higher than normal cap-ex • Growth driven by spend on new shop design & roll-out, IT upgrades • EBITDA broadly in line with FY15 • Cap-ex likely to be in order of $100m
Slide 13: Cost Drivers: Network Enhancements
COST DRIVERS: NETWORK ENHANCEMENTS For personal use only Significant investment in strategic acquisitions & start-ups • Circa $7m in EBIT losses from start-ups & small, loss-making acquisitions • Losses partially offset by StudentUniverse profits • Long-term growth drivers but adverse impact on shor
Slide 14: Financial Highlights: Cash Position
FINANCIAL HIGHLIGHTS: CASH POSITION For personal use only Strong Healthy Minimal positive cash debt cash reserves position At Dec 31, FLT had the 5th strongest net debt position on the ASX 100
Slide 15: Financial Highlights: Cash
FINANCIAL HIGHLIGHTS: CASH For personal use only $1.52b global cash & investment portfolio Includes $506.7m in company cash FLT took on $52m in short-term debt during $76.8m in debt FY16 & reinvested the Strong cash borrowings at a superior position & profit interest rate $429.9m positive cash leadi
Slide 16: Financial Highlights: Growth
FINANCIAL HIGHLIGHTS: GROWTH For personal use only New brands & Numbers decreased 3.2% increase new during 2H as some in sales teams geographies dual teams were merged into single teams (particularly US 7 acquisitions 2.5% increase in wholesale) to sales staff globally complement NETWORK organic gro
Slide 17: FY16 Results Summary
FY16 RESULTS SUMMARY For personal use only $’ million JUNE 2016 JUNE 2015 % TTV $19.3b $17.6b 9.7% Revenue $2.7b $2.4b 11.2% Income margin 13.8% 13.6% 20bps Net margin (underlying) 1.83% 2.07% (24bps) Underlying Profit Before Tax $352.4m $366.3m (3.8%) Non-recurring items ($7.4m) - - Statutory Profi
Slide 18: Global Review
For personal use only REVIEW GLOBAL
Slide 19: Global Review: Trading Highlights
GLOBAL REVIEW: TRADING HIGHLIGHTS For personal use only Sales Leisure v Corporate • Record TTV in all 10 • Corporate businesses countries/regions in AUD generated 33% of FY16 TTV • Growth largely organic – • Consolidating FLT’s position as relatively small contribution one of world’s largest from ac
Slide 20: FY16: Australia Segment
FY16: AUSTRALIA SEGMENT For personal use only 5% TTV Recovery in 2% EBIT increase leisure gross growth during margins period of SOLID Above growth STABLE PROFIT (commissions) significant SALES in outbound MARGINS following GROWTH investment & in travel (4.5%) decline during low yield per ABS) PCP en
Slide 21: FY16: Australia Segment – TTV
FY16: AUSTRALIA SEGMENT – TTV For personal use only 18 16 Percentage Growth YOY 14 12 10 8 6 4 2 0 FY10 FY11 FY12 FY13 FY14 FY15 FY16 Outbound Travel Growth % FLT TTV Growth % Australian TTV growth continues to outpace outbound travel growth (Source: ABS)
Slide 22: FY16: Australia Segment
FY16: AUSTRALIA SEGMENT For personal use only Cheap airfares slowing TTV growth and leading to lower than anticipated super over- FLT’s average rides international yields down 4% during 2H Also stimulating demand in subdued consumer confidence environment
Slide 23: FY16: Australia Segment
FY16: AUSTRALIA SEGMENT For personal use only Leisure • TTV per shop in line with FY15 – strong growth in hyperstore & expo sales • Solid growth in some key sectors – coach, cruise, adventure, FX • Evolving along P2P Index – developing high & low touch offerings • LCC sales increasing off small base
Slide 24: Corporate Value Propositions
CORPORATE VALUE PROPOSITIONS For personal use only Technology People Reporting Brand diversity FLT’s – specialised offers across Corporate Innovation multiple sectors Strengths
Slide 25: FY16: Europe Segment
FY16: EUROPE SEGMENT For personal use only KEY FINANCIAL ACHIEVEMENTS • TTV topped GB1b Netherlands • $AU47.2m EBIT contribution – 2nd best ever UK Ireland • Strong corporate travel results • BREXIT uncertainty & investments slowing profit growth FC Europe
Slide 26: FY16: Europe Segment
FY16: EUROPE SEGMENT For personal use only Enhanced Geographic & Brand Diversity • Secured a corporate travel footprint in Continental Europe – FCM Netherlands – & platform for SME expansion • Opened 1st leisure business outside the UK - Dublin hyperstore (August 16) • Expansion into Wales - FCBT to
Slide 27: FY16: USA Segment
FY16: USA SEGMENT For personal use only Student KEY FINANCIAL ACHIEVEMENTS Universe • Record TTV – topped $AU3b for 1st time FCUSA Mexico • FLT’s 2nd largest region by sales • $AU21.2m EBIT contribution – down slightly on record FY15 result USA SEGMENT • Strong performance from StudentUniverse & SME
Slide 28: FY16: USA Segment
FY16: USA SEGMENT For personal use only Corporate • Continued strong growth from SME corporate business • Organic expansion into new cities – Raleigh, Minneapolis & Orange County • FCM Mexico has given FLT a presence in a new & strategically important market Leisure & Wholesale • Disappointing botto
Slide 29: FY16: Rest of World Segment
FY16: REST OF WORLD SEGMENT For personal use only NZ South Africa Canada Record TTV & return to profit Record profit & TTV Record profit & TTV after losses during FY15 Strong corporate & leisure results Strong corporate performance & Essentials (IAPs) launched & – leading to increased market- reduce
Slide 30: FY16: R.O.W Segment – Induasia
FY16: R.O.W SEGMENT – INDUASIA For personal use only KEY FINANCIAL ACHIEVEMENTS UAE Singapore & • Record TTV in all regions Malaysia • Leading to $988m combined TTV • EBIT growth in UAE • Reduced earnings in India, India Greater China Greater China INDUASIA • Losses in Singapore but return to profit
Slide 31: FY16: R.O.W Segment – Induasia
FY16: R.O.W SEGMENT – INDUASIA For personal use only UAE Greater China India Singapore Modest TTV growth in low yield Record TTV but disappointing Record TTV, EBIT growth Record TTV but lower EBIT environment earnings Expansion in Chandigarh, Continued corporate profits Corporate Traveller launched
Slide 32: FY16: Other Businesses
FY16: OTHER BUSINESSES For personal use only Good profit contribution Solid growth across core Positive EBIT contribution Continued growth in 1st full year business units from joint venture DMC Asia range launched & Working with internal (FLT) Now operating in 11 Record EBIT & TTV performing strongl
Slide 33: FY16: Results by Country
FY16: RESULTS BY COUNTRY For personal use only CANADA EUROPE INDIA GREATER CHINA TTV: $1.2b, up 3% in TTV: $2.2b, up 14% in TTV: $419m, up 9% in TTV: $271m, up 17% in AUD (up 2% in lc) AUD (up 6% in lc) AUD (up 2% in lc) AUD (up 7% in lc) EBIT: $0.7m EBIT: $47.2m EBIT: $0.2m EBIT: $0.0m BUSINESSES:
Slide 34: Strategic Update
For personal use only UPDATE STRATEGIC
Slide 35: FLT at Its IPO
FLT AT ITS IPO For personal use only 4 leisure brands FLIGHT 95% of sales CENTRE 1 corporate in Australia LIMITED brand & NZ 1995 About 1000 employees in 5 countries
Slide 36: FLT Today
FLT TODAY For personal use only Some 40 Travel retailing, corporate, in- brands destination travel experience, non-travel, youth/student Generating FLIGHT One third of FY16 sales about 50% of CENTRE 6 dedicated Now one of the world’s generated in the corporate largest corporate travel TTV outside TR
Slide 37: Corporate Brands / Leisure Brands / Wholesale
For personal use only CORPORATE LEISURE / BRANDS WHOLESALE
Slide 38: For personal use only
For personal use only
Slide 39: Flight Centre Travel Group … Who Are We?
FLIGHT CENTRE TRAVEL GROUP … WHO ARE WE? For personal use only IRREVERENCE We don’t believe in conventional wisdom. We take our business seriously but not ourselves. EGALITARIANISM No status or privilege, self important people don’t fit in here. OWNERSHIP We take full responsibility and treat the bu
Slide 40: Strategic Evolution
STRATEGIC EVOLUTION For personal use only Specialised brands Brand & Sales & Product Unique marketing products machine Physical Digital (shop) Travel Strategic Info – Agent to Journeys profiles, Retailer Experts not patterns & agents predictions People Sales Blended Shops as Business retail access s
Slide 41: Longer Term Growth Drivers
LONGER TERM GROWTH DRIVERS For personal use only JANUS… The Roman god of beginnings, gates, transitions, time, doorways, passages and endings
Slide 42: The Ring of Janus
Leisure Travel For personal use only Retailing In Incubation Destination Acceleration Travel FLT … Investment Experiences THE RING OF The next 20 years Other JANUS Corporate Businesses Travel Student/ Youth Travel
Slide 43: Janus One: Leisure Travel Retailing
For personal use only Janus One LEISURE TRAVEL RETAILING
Slide 44: Our Journey from Travel Agent to ...
For personal use only OUR JOURNEY FROM TRAVEL AGENT TO
Slide 45: Travel Retailing … The P2P Index
TRAVEL RETAILING … The P2P index For personal use only CORE LEISURE VOLUME 85-90% of Australian TTV OTA CONTACT FLAGSHIP COMMUNITY HOME EVENTS CENTRES STORES BASED • High volume, low • 24/7 telephone • Hyperstores • Shopping centres • Associates • Travel Expos, touch, low margin sales & assist • Meg
Slide 46: Shop Journey: Then and ...
SHOP JOURNEY: THEN AND ... For personal use only
Slide 47: … Flight Centre Now
For personal use only … FLIGHT CENTRE NOW
Slide 48: … Flight Centre Now
For personal use only … FLIGHT CENTRE NOW
Slide 49: For personal use only
• Airfare-led package brand For personal use only with ability to Launched in make August 16 personalised and on track recommendations to deliver $3m in TTV • New Route in month 1 Perfect planning tool introduced
Slide 50: For personal use only
Fa Aentery | Pen & Boot, = cfr plar_aumtbetty.comau Sl Apes [Lj Segge:tet Ste: Fight Oeck 9 wweseecom mace G ec Mt RE Feat - hoycnto = Aunt Bey y a Pian your trip Top itiner: Lf Plan your trip aia AS Pian & Book your perfect trip to Europe! Rome, italy Easily plan your trip based on your travel pref
Slide 51: Janus Two: In-Destination Travel Experiences
For personal use only Janus Two IN-DESTINATION TRAVEL EXPERIENCES
Slide 52: Travel Experience Network
TRAVEL EXPERIENCE NETWORK For personal use only Vision: Distributing and Delivering Amazing In-Destination Travel Experiences
Slide 53: Travel Experience Network
Distribution Wholesale/ Inbound/ GSA/ Voucher For personal use only Procurement Hotels FIT/GIT/ Corp/ Leisure/ Corp 2. TRAVEL Groups etc Distributing & Delivering EXPERIENCE Amazing In-Destination Travel NETWORK Experiences Tours Ops Shared Mature/ Services Youth/Small Tax/Legal/ Group/ Asset/FX/ Ad
Slide 54: Janus Three: Corporate Travel
For personal use only Janus Three CORPORATE TRAVEL
Slide 55: Truly Global: The Big 5
TRULY GLOBAL: The Big 5 For personal use only FLT CWT By sales, FLT now ranks among the world’s top 5 corporate travel managers BCD AMEX HRG
Slide 56: FLT's Corporate Brands
FLT’S CORPORATE BRANDS For personal use only ✓ TMC ✓ SME ✓ Entertainment / Sport ✓ MICE ✓ Education ✓ Consulting ? Low Cost Corporate Now turning over more than $6b per year
Slide 57: For personal use only
OURDIFFERENCE = BOOKING& REPORTING —EXPERTINSIGHTS — OFFERS. Add up your savings with our travel calculator = (©) @) fp) =) © = Oo ip) i= ® o) For
Slide 58: For personal use only
a = O a) @ S © = s) ” — © a. — O Le FCM ION: AboutFCM ~ Solutions » Services y | NewsHub Australia | 1300557 854 fa] Contact Us v Technology that will streamline your travel all over the world Read more > About FCM Technology in Making a difference to your business travel Client case studies - prove
Slide 59: The Making of The Dressmaker
THE MAKING OF THE DRESSMAKER
Slide 60: For personal use only
For personal use only
Slide 61: For personal use only
te, Australia 36129923 89@0) J cieventzcom inspire. freial WHAT WEDO PLANMY EVENT WHOWEARE CASESTUDIES WHITEPAPERS BLOG SHOWREEL NEWS CAREERS CONTACT Our Services Event Event Incentives, Digital & Design Latest Event Twitter Management Production Reward & Management Our al, gI cnt Recognition me New
Slide 62: Fifth Dimension Business Travel Consulting
ALTHDIMENSIC BUSINE RAVEL CONSULTING
Slide 63: Janus Four: Student/Youth Travel
For personal use only Janus Four STUDENT/YOUTH TRAVEL
Slide 64: Highly Coveted Youth Travelers
Highly Coveted Youth Travelers For personal use only Multiple long-haul trips Educational, leisure & altruistic per year travel purposes 18 – 30 years-old Long-term customer base Explore new destinations High yield Global explorers Flexible dates $200b-a-year industry Future business travelers
Slide 65: The Youth Sector
THE YOUTH SECTOR For personal use only 48% of Aussie Highly outbound fragmented travellers are aged market under-40 On and offline A multi billion $ offerings: sector StudentUniverse & Student Flights The opportunity
Slide 66: Janus Five: Other Businesses
For personal use only Janus Five OTHER BUSINESSES
Slide 67: Other Businesses Adjacent to Travel Business Model
OTHER BUSINESSES For personal use only ADJACENT TO TRAVEL BUSINESS MODEL
Slide 68: For personal use only
For personal use only
Slide 69: Pedal Group / Advance Traders
4 PEDAL G RoUR Our purpose... ge Enriching mind, pea earth and soul with the freedom of riding. ADVANCE TRADERS*
Slide 70: Janus Six: Incubation/Acceleration/Investment
For personal use only Janus Six INCUBATION/ ACCELERATION/ INVESTMENT
Slide 71: Incubation/Acceleration/Investment
INCUBATION/ACCELERATION/ INVESTMENT For personal use only Objective: To establish the world’s leading travel accelerator, incorporating areas of our DNA and contributing to our future story Long-term plan for incubation Mentoring & hubs in key developing start-ups to accelerate global locations grow
Slide 72: Achieving the Objective?
Achieving the Objective? For personal use only • Why would we do this? • What does it look like? • How are we going to make this work? Flight Centre Travel Group – Business
Slide 73: FLT … Our Strategic Anchors
FLT … Our strategic anchors For personal use only 1. Make it easy to buy from us and thus lead to sticky and deep customer relationships 2. Famous distinctive brands with expertise 3. Scalable growth
Slide 74: Digital Strategy
DIGITAL STRATEGY For personal use only We have a clear global digital commerce strategy. Improving usability and bookability. Investing in scalability. Blending offline and online. Unique access to agents. 74
Slide 75: Book With Me: Coming Soon
BOOK WITH ME: COMING SOON For personal use only A blended travel initiative • Allows customers to seamlessly transact with their consultant when & how they want Personalised URLs • Customer can use the consultant’s personal Flight Centre URL to book online, while maintaining the personalised managem
Slide 76: For personal use only
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Slide 77: Market Conditions & Outlook
For personal use only MARKET CONDITIONS & OUTLOOK
Slide 78: FY17: Guidance
FY17: GUIDANCE For personal use only • Impossible to provide meaningful FY17 profit guidance after 8 weeks’ trade & in volatile conditions • Q4 conditions continued into July but some recovery in August • Will continue to monitor market conditions & performance during Q1 • Expect to provide more det
Slide 79: FY17: Growth Drivers – Productivity
FY17: GROWTH DRIVERS - PRODUCTIVITY For personal use only Grow Stop doing blended unnecessary & online things sales Increase enquiry IT & System & improve change conversion Right Drive P2P product & margin
Slide 80: FY17: Other Growth Drivers
FY17: OTHER GROWTH DRIVERS For personal use only Network Accelerated TTV expansion & growth •Dedicated online On track to top enhancement brands growing strongly $20b this year • Transactional Online Stronger returns websites being rolled sales on recent out globally growth investments • Driving the
Slide 81: TTV Growth: On Track to Top $20b
TTV GROWTH: ON TRACK TO TOP $20b For personal use only FY97: $FY04: $FY08: FY17: $1b+ $5b+ $10b+ $20b+ If TTV exceeds $20b this year, sales will have increased more than 16-fold in 20 years
Slide 82: FY17: Online Expansion
FY17: ONLINE EXPANSION For personal use only By the end of FY17, 12 months ago, FLT FLT will have a generated almost all of its significant online online leisure TTV by selling presence in Australia, FY17: scheduled carriers’ fares on Should the Americas, Europe, flightcentre.com.au FY16: generate S
Slide 83: StudentUniverse: Growing Strongly
STUDENTUNIVERSE: GROWING STRONGLY For personal use only Strong profit and TTV contribution since acquisition International expansion opportunities – China, Canada, UK Synergies – dNA area created, access to FLT student fares
Slide 84: FY17: Growth Drivers – Expansion
FY17: GROWTH DRIVERS – EXPANSION For personal use only Targeting 6-8% sales staff growth globally Organic growth, complemented by strategic acquisitions (vertical & horizontal opportunities) Will have more than 20,000 people & more than 3000 sales teams Entering new geographies (organic expansion &
Slide 85: FY17: FLT's Growth Recipe
FY17: FLT’S GROWTH RECIPE For personal use only Variations in Variable FCB in Australia has a how brands organic growth grow on P2P strong shop presence & rates Index Rates differ from brand to has been growing at edges brand & from country to of P2P Index country Exporting proven Growing network of
Slide 86: FY17: Europe & The Americas
FY17: EUROPE & THE AMERICAS For personal use only Europe • Some ongoing uncertainty in UK following BREXIT vote • Some recovery expected during FY17 as leisure & corporate travellers adapt • Experienced management team in place, brand & geographic diversity Americas • Benefits flowing from combined
Slide 87: FY17: Australia
FY17: AUSTRALIA For personal use only Leisure & New revenue corporate streams growth opportunities Outbound travel increasing, but at a slower rate than normal New credit card laws will adversely affect FLT but Competitive Market aviation the company believes new sector growth initiatives will gener
Slide 88: FY17: Australia – New Revenue Streams
FY17: AUSTRALIA – NEW REVENUE STREAMS For personal use only New offerings – New brands – interest-free Aunt Betty holidays, Student Flights’ lay-buys New products – Increased LCC & IAPs, Key To The ancillary product World, Jetbidders New sales Revenue Streams
Slide 89: FY17: New Products – Key To The World
FY17: NEW PRODUCTS – KEY TO THE WORLD For personal use only More than 50,000 in circulation in 1st nine weeks
Slide 90: FY17: New Products – Key To The World
FY17: NEW PRODUCTS – KEY TO THE WORLD For personal use only Unique Offering •World 1st digital travel wallet – lock in the exchange rate for up to 10 currencies •Created by Travel Money Oz, MasterCard & Cover-More Roll-out Underway • Launched mid-July 2016 & available through the FLT brands and via
Slide 91: Jetbidders
© ©@ https://www.jetbidders.com Any flight. Anywhere.
Slide 92: FY17: Growth Opportunities – LCCs
FY17: GROWTH OPPORTUNITIES – LCCs For personal use only • LCCs had 16.4% In-store and international market-share online growth in Australia during CY15 FLT’s LCC sales Better online increasing connectivity strongly (off small base) & range • Market-share (to date) peaked at 18.7% during CY10 Commerc
Slide 93: Market Conditions: Positive Trends
MARKET CONDITIONS: POSITIVE TRENDS For personal use only Healthy competition: 53 international passenger airlines servicing Australia during CY15 Stability: Only one change (Etihad replacing Thai) to Australia’s top-10 airlines between CY10 & CY15 (see Supplementary Details ) International capacity
Slide 94: Market Conditions: Lower Seat Utilisation
MARKET CONDITIONS: LOWER SEAT UTILISATION For personal use only 85% 80% 75% 70% 65% 60% January February March April May Seat Utilisation CY16 Seat Utilisation CY15 Airlines are adding international capacity during CY16 but seat utilisation is falling, leading to ...
Slide 95: Market Conditions: Golden Era of Travel
MARKET CONDITIONS: GOLDEN ERA OF TRAVEL For personal use only Opportunities for Strong capacity travellers to cash-in growth on cheap deals Cheap airfares Opportunities for FLT Lower to work with carriers to seat promote special offers utilisation & help fill planes
Slide 96: Market Conditions: Falling Fares
MARKET CONDITIONS: FALLING FARES For personal use only $1,500 $1,000 $500 $0 Auckland Singapore Bangkok Bali Fiji Phuket Hawaii London LA New York Advertised fare 17/8/15 Advertised fare 17/8/16 Based on cheapest advertised return fares Headline fares to the 10 top destinations were almost 15% cheap
Slide 97: Falling Fares: The Turner Index
FALLING FARES: THE TURNER INDEX For personal use only $140,000 $131,000 $120,000 $100,000 Actual fare to London $80,000 $76,000 Adjusted fare (inflation) $60,000 Adjusted fare (based on today's $40,000 average wage) $20,000 $1,170 $1,170 $0 1947 2016
Slide 98: An Amazing Industry!
AN AMAZING INDUSTRY! For personal use only Best ever breadth and depth of travel to buy! More affordable than ever!
Slide 99: Dividends & Capital Management
DIVIDENDS & CAPITAL MANAGEMENT For personal use only FY16 DIVIDENDS CAPITAL MANAGEMENT • Plan to retain sufficient cash to fund growth initiatives, capitalise on opportunities & buffer FLT from future economic downturns 60c per 92c per 152c per • Board committed to returning any surplus cash in futu
Slide 100: Questions?
For personal use only QUESTIONS?
Slide 101: Supplementary Details
For personal use only DETAILS SUPPLEMENTARY
Slide 102: 5-Year Growth Trajectory
5-YEAR GROWTH TRAJECTORY For personal use only JUNE 2016 JUNE 2015 JUNE 2014 JUNE 2013 JUNE 2012 TTV $19,305m $17,598m $16,049m $14,259m $13,238m Income margin 13.8% 13.6% 14.0% 13.9% 13.8% EBITDA $413.9m $417.0m $378.4m $395.2m $330.7m PBT $345.0m $366.3m $323.8m $349.2m $290.4m NPAT $244.6m $256.6
Slide 103: FY16 TTV Milestones
FY16 TTV MILESTONES For personal use only Australia: Topped $10b for On average, FLT 1st time sold more than USA: Topped $AU3b for 1st • FLT exceeded $AU1b in TTV $50m worth of time in 5 of 10 regions travel globally South Africa: Topped R5b every day during for 1st time • Combined TTV in Asia, FY16
Slide 104: FY16: Strategic Acquisitions & Rationale
FY16: STRATEGIC ACQUISITIONS & RATIONALE For personal use only StudentUniverse BYOjet • Leading online platform • Ultra low cost airfare with proprietary specialist technology • Cheaper alternative to • Ability to sell restricted many of the larger OTAs student/youth fares online • Rolled out in UK
Slide 105: FY16: Strategic Acquisitions & Rationale
FY16: STRATEGIC ACQUISITIONS & RATIONALE For personal use only FCM FCM Malaysia Netherlands Bolstering the global FCM network & cievents’ offering by acquiring businesses in key locations Maya Events FCM Mexico (HK) Broader Corporate Footprint
Slide 106: FY16: Strategic Acquisitions – AvMin
FY16: STRATEGIC ACQUISITIONS - AVMIN For personal use only • Charter & logistics specialist - profitable in 1st year Mining & • High profile client list – blue chip companies, VIPs, construction Sports teams celebrities & sports teams • Long-term Remote Airport Management contract with Santos VIP &
Slide 107: FY16: Operating Cash Flow
FY16: OPERATING CASH FLOW For personal use only • $356.6m operating cash inflow over full year, in line with FY15 • Major swings in operating cash flow typically brought about by timing of airline payment cycle (BSP) • FLT’s cash builds during peak 2H booking periods for payment to suppliers after p
Slide 108: Australia's Top-10 Carriers
AUSTRALIA’S TOP-10 CARRIERS For personal use only 2015 Calendar Year 2010 Calendar Year 1. Qantas 1. Qantas 2. Emirates 2. Singapore Airlines 3. Jetstar Other airlines 3. Air New Zealand Other airlines 4. Singapore Airlines had 27.2% 4. Emirates had 26.1% 5. Virgin combined 5. Jetstar combined marke
Slide 109: International Capacity Growth
INTERNATIONAL CAPACITY GROWTH For personal use only 12.00% 10.00% After modest growth during 8.00% CY15, international 6.00% capacity is up 4.00% strongly in 2.00% Australia during CY16 (Source: BITRE) 0.00% Jan-16 Feb-16 Mar-16 Apr-16 May-16 Capacity Growth CY15 AVG Growth Rate
Slide 110: Disclaimer
Disclaimer For personal use only Disclaimer and important notice for presentation This presentation has been prepared by Flight Centre Travel Group Limited ABN 25 003 377 188 (FCTG). This presentation contains general background information about FCTG and its subsidiaries and their activities curren
Flight Centre Travel Group — FY2016 Earnings Presentation on 6ix