ACQUISITIONS TAKE OFF FOR CORPORATE TRAVEL MANAGEMENT

Written on the 25 February 2015

ACQUISITIONS TAKE OFF FOR CORPORATE TRAVEL MANAGEMENT

A RAFT of global acquisitions has boosted Corporate Travel Management's (ASX:CTD) half-year profit by 76 per cent.

The travel solutions provider reported net profit after tax of $9.9 million, with total transaction value up 127 per cent at $1.11 billion compared to the previous period.

Underlying earnings before interest tax depreciation and amortisation increased 94 per cent to $20.2 million.

The solid growth in the half year has led the company to upgrade its full-year EBITDA guidance to between $46 million and $48 million, from $45 million previously.

Corporate Travel Management managing director Jamie Pherous (pictured) says the strong result is attributed to the growth strategy and proper integration of acquisitions.

CTD now operates out of 46 cities in 23 countries, with North America continuing to be a key area of focus.

The brand operates in 18 cities across eight states in the US, after acquiring Alaskan-based TMC USTravel in July and Avia International Travel in Texas in September.

"We have had a truly excellent half in light of the tough business conditions," Pherous says.

"Most pleasing was that all regions grew market share through winning and retaining clients, achieved record first half profits, and the impact of our acquisitions continues to have a positive effect on the business globally.

"In fact we achieved solid organic growth in every acquired business while integrating and harmonising these great businesses into the group."

CTD has also recorded strong domestic growth, with total transaction value up 15 per cent.

Pherous says concerns about the softening oil and gas industry have been factored into the full-year profit forecast.

The company also acquired Chambers Travel in Europe and Diplomat Travel in the US in December 2014, which is expected to earnings per share accretive in FY15.

Looking ahead, Pherous says the strategy will be to continue scalable organic growth in all regions, while leveraging the network to build market share.

CTD will pay an interim fully franked dividend of 6c per share on April 10.


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