Corporate Travel Management (CTD) H2 2024 earnings summary

Executive summary

• FY24 revenue grew 9% to AUD 716.9 million, with underlying EBITDA up 21% to AUD 201.7 million, but results underperformed guidance due to North America macro impacts, underperformance of bridging accommodation contracts, and rapid tapering of one-off war-related humanitarian work in Europe.

• 2H24 saw significant turnarounds in North America and ANZ, both recording 39% increases in 2H EBITDA and margin expansion, with Rest of World (North America and ANZ) EBITDA up 29% and margin rising from 21% to 27%.

• Proprietary technology, including Sleep Space and automation projects, drove strong EBITDA margin growth and operational efficiency.

• Europe’s full-year revenue grew 18% and EBITDA 16%, but 2H results were sharply down due to the end of humanitarian projects.

• Asia posted a 24% revenue increase and 29% EBITDA growth, led by corporate segment strength, though China’s recovery lagged.

Financial highlights

• Underlying NPAT attributable to owners rose 22% to AUD 113.3 million; statutory NPAT increased 9% to AUD 84.5 million year-over-year.

• Underlying EPS up 23% to 77.7c; statutory EPS up 9% to 57.9c; EBIT-EPS increased 23% year-over-year.

• Cash conversion finished at 89%, with net cash outflow of AUD 16.2 million after all items.

• AUD 84.1 million was returned to shareholders via dividends and buybacks.

• Net cash position at June 30, 2024, was AUD 134.8 million, with an unused facility of AUD 100 million and no debt.

Outlook and guidance

• FY25 is positioned as a reset year, cycling off non-recurring project work; Rest of World targets 10% revenue growth and EBITDA margin of 27.5%.

• Europe expects an 18% revenue decline due to the absence of one-off projects, but EBITDA margin is forecast at 49%, above pre-COVID levels.

• Group results will be skewed to 2H due to seasonality and rollout of initiatives, with management expecting a 65% 2H EBITDA skew in FY25.

• Europe expected to return to BAU levels, with no major project work assumed; EBITDA margins to remain highest in the group.