Travel management company CTM has posted record 1HFY24 results that include the doubling of revenue in Europe and has set out plans to achieve two-fold profit growth within the next five years.
The Australia-headquartered company posted group revenue of AU$363.7 million in the six months up to 31 December 2023, up 25 per cent on the previous corresponding period, and underlying EBITDA of AU$100.7 million, up 96 per cent on 1HFY23.
Client retention is at 97 per cent while in the first half of its financial year CTM won $630 million's worth of new clients which are expected to exceed travel spend of AU$1 billion for FY24.
More than a quarter of CTM's revenue (AU$98.5 million) originated from its European business which was more than double (118 per cent) that achieved in 1HFY23.
The value of its Bridging Contract with the UK government – awarded last year to manage the accommodation needs of asylum seekers – was "significantly lower in H1 versus initial customer expectations", CTM reported, but that was "more than offset by significant client wins" and other crisis and humanitarian work.
The TMC noted that much of its new business transacts at more than 90 per cent online and that it would continue to invest in a larger sales team in the region to support its five-year growth strategy. Earlier this month CTM announced a series of new appointments in the UK including industry veteran Julian Mills.
Revenue in North America increased by three per cent to AU$150.7 million but was the region most negatively affected by macro events including travel sentiment relating to conflict in the Middle East and travel budgets being "fully utilised by 1Q24 due to unsustainably high ticket prices".
Revenue increased one per cent in Australia and New Zealand, to AU$81.4 million, and by 63 per cent in Asia, to AU$32.5 million, the latter despite slower than forecast travel recovery in China.
Looking ahead, CTM said that to achieve its goal of doubling profits within five years it will need to achieve new sales in FY25 of AU$1 billion, rising to AU$1.6 billion by FY29, and assumes client activity growth of 3 per cent or more per annum.
Its strategy does not require acquisitions but noted there are likely to be such opportunities and that "large scale industry consolidation" is likely.