Broker Morgan’s said Asia was lagging most regions in the recovery of travel mainly because of China’s Covid restrictions.

The market was also currently dominated by travellers reconnecting with friends and family after two years of travel bans and typically this provided lower margins and fewer upsell opportunities.

What demand there was for travel was being affected by airlines struggling to cope because of staff shortages.

However, there were some strong signs of a recovery. Tourism Research Australia data released today showed April was standout month for domestic tourism with spending in Queensland up 56 per cent to almost $1 billion.

Nationally, visitor nights had not yet returned to pre-Covid levels.

“However, travellers were spending more on average,” the report said.

“The average spend per trip was up $252 or 37 per cent to $939 when compared to April 2019.”

However, for the year to the end of April, domestic overnight spending was still down 30 per cent.

“April 2022 said the best result in interstate travel since the beginning of the pandemic,” it said.

Morgan’s analyst Belinda Moore said there was a list of issues hitting tourism and in Australia a significant one was the limited capacity of airlines which was at 40 to 50 per cent on 2019 levels.

Companies were also struggling to lure back workers they were forced to sack at the start of the travel bans.

She said this was restricting volume growth which was also being impacted by higher fuel costs pushing up air fares.

“High air fares may limit some consumers willingness to travel,” Moore said in a note to investors.

Moore has lowered expectations for Corporate Travel’s 2023 earnings by 10 per cent, Flight Centre by 8.5 per cent and Helloworld by 33 per cent.

“The unknown on travel demand is whether inflationary pressures and recession fears affect household and corporate budgets,” Moore said.

“While these factors may affect the shape of the travel recovery over 2022-23 IATA has always forecast travel demand to (would not) exceed pre-Covid levels until 2024.

CTD’s earnings before interest, tax, depreciation and amortisation has been lowered by 10.7 per cent to $175 million. Flight Centre was now expected to show an EBITDA of $324 million.

Data released today by Tourism Research Australia showed that there had been strong spending in April. Total spending was $10.1 billion in the month, an increase of 31 per cent on 2019.