22 August 2018

CTM delivers strongest ever results for FY18

Corporate Travel Management (CTM, ASX: CTD) today reported its strongest ever full-year results, with earnings (EBITDA) of $125.4 million reflecting a 27 per cent increase on the previous year. CTM Managing Director and founder Jamie Pherous said the performance reinforced the company’s global expansion strategy, with organic growth contributing $18.9 million to its profit growth.

“We have had another strong year,” he said. “Each region in our network has had a record result, demonstrating our business model and strategic investment decisions are working well for clients and investors.”

CTM’s global operations continued to grow, recording $4.95 billion in total transaction value, up 19 per cent, with revenues up 14 per cent, reflecting the efforts of CTM’s hard-working team to win and retain customers.

“We have continued to expand through increasing market share, including multinational clients who have recognised our international capabilities,” Mr Pherous said. “These results support our strategy to build a global network by applying a high-quality growth business model around winning and retaining customers, driving internal automation and client innovation and ensuring high staff engagement and client satisfaction.”

Regional performance

CTM’s founding region, Australia and New Zealand, continued to outperform the market, reporting a 21 per cent increase in underlying EBITDA to $44.0 million. This result was secured with record client win and retention rates, while an impressive 80 per cent of customer transactions are now completed online.

Europe was CTM’s top performing region by growth percentage, with an underlying EBITDA of $34.2 million up 86 per cent on the prior corresponding period. The performance was underpinned by a combination of increased online business activity, CTM’s SMART Technology suite and strong organic growth.

CTM North America provided steady revenue and profit contributions, with underlying earnings of $38.9 million on a constant currency basis, up 8 per cent on the previous year. The region secured several strong global and regional wins in the second half of the year and, with new CTM SMART Technology soon to be releases and a strong management team in place, the business is well positioned for the long term.

CTM Asia had a strong second half for the year after ticket prices steadied in January 2018. It recorded underlying EBITDA of $20.2 million on constant currency, up 12 per cent on the previous year.

The business has completed its CTM SMART Technology roll-out in the region, including the Lightning online booking tool, resulting in strong client wins and automation gains.

Global presence and technology

Mr Pherous said CTM had now established a global footprint in all of its primary markets and had won a number of significant global clients with its award-winning CTM SMART Technology suite.

CTM’s now has technology hubs well established across all regions, employing 100 staff with a large flow of future developments scheduled for FY19.

“We remain committed to delivering superior results for clients through a consistent value proposition, including innovative customer-facing technology solutions underpinned by a highly personalised service offering, and delivering a return on investment to our clients,” Mr Pherous said.

He said CTM’s employees remain central to the company ongoing success, with staff engagement levels continuing to outperform benchmarks.

Looking ahead

CTM expects full year underlying EBITDA for FY19 to be in the range of $144-150 million, representing approximately 15-20 per cent growth on the previous corresponding period.

The CTM Board has declared a fully franked dividend of 36 cents per share an increase of 20 per cent on the prior corresponding period. It will be paid on 4 October 2018.