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Pherous set to spend on acquisitions as business travel starts to improve

Business

Corporate Travel Management is experiencing a revival of business activity and is now scouting for acquisitions in a distressed market as it starts to beat its own forecasts.

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The Brisbane company, headed by Jamie Pherous, posted an underlying profit of $65 million for the June 30 year and even scraped in a positive result for the pandemic-hit second half of $500,000. CTM has cancelled its previously announced interim dividend and said it would not pay a final dividend.

Its bottom line result was a loss of $8.2 million.

Investors cheered the result and CTM’s shares jumped 10 per cent in early trade to $13.40.

CTM was able to easily beat forecasts it made in May when it said revenue was likely to be between $2 million and $5 million a month. It was instead $11.5 million.

It had also expected a loss of up to $10 million a month but was able to peg that back to $3 million.

“Because we moved early and rapidly with redundancies and other cost reductions, we have been able to stem our losses very quickly and we do not expect any further significant one-off costs in the current financial year,” Pherous said.

CTM claimed flight scheduling was increasing in North America and Europe.

The company said it would not give any profit guidance for the 2021 year but said it has net cash of $55 million and no debt.

CTM’s bookings have started to increase and it is now claiming a broad-based recovery is underway.

“An extended period with no international travel is likely to create opportunities for industry consolidation. CTM will continue to consider potential acquisitions that align with the group’s strategy and is well positioned to pursue any relevant opportunities.”

 

 

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