Corporate Travel Management (CTM), a leading provider of travel management solutions, has announced its results for the first half of 2023, with positive indicators and strong momentum for the second half. The company has generated a fast-growing profit before tax (PBT) and net profit after tax (NPAT), which shows an increasing business-as-usual environment and cash flow generation. It also reported a record transaction value (TTV) and revenue results for the period.
CTM had underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $51.3m for 1H23, compared to $18.2m in 1H22, showing an increase of 182%. The company’s revenue and other income increased to $291.9m from $163.0m in the previous period. CTM also announced an interim unfranked dividend of 6.0c per share, payable on 14 April 2023, which shows the company’s continuous recovery.
CTM’s financial strength was also a key highlight. The company had $110.3m cash and zero debt on 31 December 2022, indicating its ability to weather difficult economic conditions. CTM reported >97% client retention and strong client wins, which boosted its overall performance.
Managing Director, Jamie Pherous, expressed his satisfaction with the results, citing the momentum that had built late in the half, resulting in a record TTV and revenue outcome in 1H23. Pherous was also optimistic about the future, saying the company had seen strong momentum in 2H23 through significant new clients transacting and activity recovery.
CTM expects to utilise the excess staff investment, which added 204 FTE during the period, to service customer growth imminently. The company has set a full-year guidance of underlying EBITDA of $160-$180m, which would be a record result surpassing FY19, and an underlying PBT of $120-$140m. The full-year guidance delivers a 2H underlying EBITDA result of $109-$129m, ensuring great momentum for the expected FY24 full recovery.
CTM’s people were also a focus during the period, with the company rebuilding its workforce and excess capacity for future servicing. CTM employed a total of 3,062 FTE on 31 December 2022, with all recognition and development programs well underway, ensuring a highly motivated team that delivers for CTM customers.
The company’s regional outcomes in North America and Europe also provided a boost to CTM’s overall performance. North America experienced a stalling of corporate travel recovery due to poor airport experience and schedule reliability, resulting in excess staff capacity throughout the period for a recovery that did not occur. However, the corporate travel recovery has reignited, and the region can manage an additional revenue recovery of 80% with limited additional costs, creating significant incremental profit for every new dollar of revenue.
Europe delivered TTV, revenue, and EBITDA at levels above 1H19. The region’s 1H23 result was a record half, with an EBITDA of $17.0m. Although this was a 19% decrease compared to the previous period, the region’s performance was still strong, and the company is optimistic about the future.
In conclusion, CTM’s positive 1H23 results and record full-year guidance show its ability to deliver in difficult economic times. CTM’s focus on its people and customer growth, along with its financial strength and strong client wins, has helped the company to succeed.
Written by: Matthew Thomas
