Flight Centre has slashed its full-year profit guidance by about 15 per cent due to a weaker than expected performance in the Australian leisure market.
The travel operator on Friday said subdued trading conditions in the Australian leisure market have reduced total transaction value in the lead-up to its key May-June trading period.
Flight Centre has cut its pre-tax underlying profit guidance for the 12 months to June 30 to between $335 million and $360 million, from the $390 million to $420 million it flagged in October.
The mid-point of the new guidance range is 10 per cent lower than last year’s record $384.7 million.
Managing director Graham Turner said Flight Centre was addressing the challenges to its Australian business, which this year will generate less than half the company’s profit for the first time.
“While we expect Australian leisure results to improve as short-term operational improvement plans gain traction and as longer-term transformational strategies are implemented, we also expect these trends to continue,” Mr Turner said.
Mr Turner said global earnings will also be weighted more heavily towards corporate travel.
Flight Centre shares were worth $44.17 before the start of trade on Friday, up 2.9 per cent this calendar year.