In This Article:
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Group 1H EBITDA: $77.4 million, exceeding expectations.
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Compound Revenue Growth (FY23 to FY25): 8%.
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EBITDA Margin (Rest of World): Expanded 500 basis points from 18% to 23%.
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Revenue Growth (Rest of World): Up 8% year-over-year.
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Cash Conversion Rate: Expected at 80-90% long-term.
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Shareholder Returns: $52.3 million returned through buybacks and dividends in 1H25.
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Australia & New Zealand Revenue: Up 18% to $96.1 million.
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Australia & New Zealand EBITDA: Up 53% to $28.5 million.
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North America EBITDA: Up 49% to $30.5 million.
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Asia Revenue: Down 7% due to 25% price deflation.
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Europe EBITDA Margin: 38.6% in 1H25.
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Effective Tax Rate: Reduced to 23.9% due to UK tax benefits.
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Net Cash Outflow: Approximately $60 million in the period.
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CapEx: $20 million in 1H25, trending towards $42 million for the full year.
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Share Buyback: $33.1 million spent in 1H25.
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Net Cash Position: $75 million with an undrawn facility of $100 million.
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FY25 Revenue Growth Target (Rest of World): Around 10%.
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FY25 EBITDA Margin Target (Rest of World): Around 27.5%.
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FY26 Revenue Growth Forecast: Around 10%.
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FY26 EBITDA Margin Forecast: Around 30%.
Release Date: February 18, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Corporate Travel Management Ltd (CTMLF) reported a better-than-expected Group 1H EBITDA of $77.4 million, indicating strong financial performance.
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The company has no debt and expects strong long-term cash conversion at historic rates of 80-90%, showcasing financial stability.
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Significant growth in the rest of the world regions, particularly Australia, New Zealand, and North America, with EBITDA up 38% and margin expansion by 500 basis points.
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High adoption of proprietary technology and focus on automation, AI, and machine learning are seen as competitive advantages, leading to high customer and staff satisfaction.
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Record corporate client wins in Europe and appointment as the sole provider for the UK government's TMC Travel Services framework, indicating strong future growth potential.
Negative Points
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FY25 is considered a transition year for Europe due to cycling off one-off war-related projects, leading to negative revenue growth in the region.
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The company experienced a net cash outflow of around $60 million in the period, primarily due to changes in working capital and shareholder returns.
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Asia faced material price deflation of 25%, impacting supplier revenues and revenue per transaction, although it only represents 9% of group EBITDA.
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The transition costs related to Project Atlas were significant, although they are not expected to continue into FY25.
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The company is carrying 80 staff in Europe transitioning from project work, which has impacted profitability in the short term.