Flight Centre Travel Group has cut its growth expectations for its 2025 fiscal year in part due to U.S. policies on trade and immigration, though its corporate business remains generally solid, the travel management group said in a filing with the Australian Securities Exchange on Monday.
The group said recent U.S. developments—including trade policy and increased scrutiny for arriving international visitors—have "exacerbated the volatile trading conditions experienced throughout the year," which has cut back on growth in total transaction value. With that uncertainty occurring during its busiest months of May and June, growth likely will be insufficient for the group to hit its previously announced pre-tax profit target of A$365 million to A$405 million (US$234.8 million to US$260.5 million) for the fiscal year, which runs through June 30. It now expects its pre-tax profit to range between A$300 million and A$335 million (US$192.9 million to US$215.5 million), according to the filing.
Even with the adjustment, Flight Centre noted its "corporate business continues to trade solidly in most regions," and it expects trading conditions to stabilize in the 2026 fiscal year for "stronger overall results."
"Our corporate business is now materially larger than it was pre-Covid, its offerings are resonating strongly with customers and productivity gains of 15 to 20 percent are expected between [the 2024 and 2026 fiscal years] if the business achieves its targets," Flight Centre managing director Graham Turner said in a statement. "In addition, the account pipeline is strong, given FCM alone has already secured new contracted accounts with projected annual spends of more than $1 billion during fiscal year 2025."
Flight Centre already had announced plans to reduce full-time employees in its corporate business by 5 percent year over year by the end of the 2025 fiscal year, largely through attrition, and that reduction is "on track," according to the group. The group has instituted a recruitment freeze across its other businesses and is looking to cut largely in non-customer-facing areas.
The group also said it plans to invest about A$25 million (US$16.1 million) in TPConnects this year "to introduce a broader range of capabilities and functionality that will decrease the business's reliance on third-party systems."