The Flight Centre Travel Group Ltd (ASX: FLT) share price is down 11% in response to the company’s disappointing update earlier in the day.
Flight Centre is one of the world’s largest travel agent businesses, it has a substantial network of operations in other countries as well.
Why The Flight Centre Share Price Is Down 11%
The travel agent business has warned that its Australian leisure segment has not recovered in line with expectations because of subdued trading conditions leading to a drop in the total transaction value (TTV).
Flight Centre has admitted to shareholders that it has reduced its underlying profit before tax (PBT) for FY19 to an expected range of between $335 million and $360 million from the previous guidance of $390 million to $420 million.
The company explained that the mid-point of the lower range is $347.5 million, which represents a 10% decrease of the $387.7 million profit generated in FY18.
The Flight Centre Managing Director Graham Turner said: “Our FY19 result will highlight the challenges we are addressing in Australia but will also underline two of our great strengths – our emergence as a world leader in corporate travel and our changing earnings profile.”
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Disclaimer: Any information contained in this article is limited to general financial/investment advice only. The information has not taken into account your specific needs, goals or objectives, so please consider consulting a licenced and trusted adviser before acting on the information. Please read The Rask Group’s Financial Services Guide (FSG) for more information. This article is authorised by Owen Raszkiewicz of The Rask Group, which is a corporate authorised representative No. 1264179 of Strawman Pty Ltd (ACN: 610 908 211) (AFSL: 501 223).
At the time of publishing, Jaz does not have a financial interest in any of the companies mentioned.