Australia’s Corporate Travel Management has managed to convert the recovery in global business trips into a small profit, after more than two years of tough trading conditions.
It was boosted in particular by winning large accounts off rival agencies, according to CEO Jamie Pherous, and three pandemic-era acquisitions, the most recent being 1000 Mile Travel Group, an all-share transaction worth $1.3 million carried out last month.
The Brisbane-headquartered agency reported a 2022 full-year profit of $41.4 million on an underlying earnings before interest, taxation, depreciation, and amortization (or EBITDA) basis. That’s for the 12 months up to June 30, 2022, and follows total transaction value of $3.51 billion — more than three times the $1.12 billion recorded in 2021. Revenue was $269.1 million.
In 2021 it made a loss of $5 million, on an EBITDA basis.
Speaking during an earnings call on Tuesday, Pherous said new clients were contributing to its results, with those clients having moved from its competitors, rather than previously having had unmanaged travel programs.
“We’re winning a lot of business and most of it’s off peers,” he said. “A lot of peers are in difficult positions and can’t reinvest in technology or people at the moment.”
In its 2022 first half, which covers the six months to Dec. 31, 2021, it won $3.27 billion of new corporate business. That amount equates to how much those companies spent on travel during 2019.
“We’re one of the very few (agencies) that can demonstrate we can convert recovering activity into revenue and profit before tax,” he added.
The CTM boss also played down any concerns over staffing levels. It recruited 950 employees in the 12 months, and more than doubled staff in its recently acquired Helloworld division from 125 to 285 people.
Pherous also said that CTM had an “out of the box” recruitment strategy.
“We’re finding people from outside the industry, and put them through our academy. Our senior executives talk about their youth and exuberance,” he said. “We’re nearly at the resources we need. We think it’s critical, we’re not in that race to barter and bargain for staff.”