Flight Centre warns of huge annual loss.
Flight Centre has just issued a profit warning, advising that it now expects to report a statutory loss of between $825 million and $875 million for the year to 30 June 2020.
The company had achieved an underlying pre-tax profit of $150 million in the eight months to February 29, but since then the imposition of widespread travel restrictions has led to significant losses.
One-off impacts to the bottom line include $110 million in COVID-related costs to reduce monthly cash outflows, as well as the costs of supplier failure, impairment charges and write-offs against goodwill, shop fixtures and software assets.
MD Graham Turner said some very tough decisions had been made over the past four to five months, but revenue was now starting to increase, particularly in Europe.
The company reduced its monthly cash burn to $53 million in July, with ongoing savings and the JobKeeper subsidy giving Flight Centre an “extended liquidity runway,” he added.
More details in today’s issue of Travel Daily.