This year has been good to the Flight Centre Travel Group Ltd (ASX: FLT) share price so far. The stock has gained 8% year to date.
But thatâs not nearly enough to see the travel giant in the longer-term green. The stock is still more than 50% lower than it was prior to the start of the pandemic.
In the same breath, it hasnât posted a profit since financial year 2019 (FY19). But that could be about to change.
The Flight Centre share price is currently $15.48.
Flight Centre’s profit crash
As anyone who watched the market crash amid the onset of the pandemic will know, it seemingly left no industry untouched. But Iâd argue the travel sector was among the worst hit.
2020 saw borders slammed shut around the globe and Aussies urged to stay at home. Itâs likely no surprise then, that Flight Centreâs profits went out the window.
The company scrapped its guidance in March 2020 and underwent a $700 million capital raise.
After recording a $343 million profit in FY19, it posted an $849 million loss for FY20, a $602 million loss for FY21, and a $378 million loss for FY22.
But the future looks brighter for Flight Centreâs bottom line. Letâs take a look at what this year might bring.
Good news for the ASX 200 travel giant’s bottom line
Flight Centre fans will be glad to know the S&P/ASX 200 Index (ASX: XJO) travel share has actually already returned to profit.
In fact, it was cash flow positive for the last few months of FY22, even breaking even in the second half.
And those figures have continued to improve. The company posted a $61 million underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) profit for the first four months of FY23 and broke even on a pre-tax profit basis.
Though, the market has yet to receive an earnings report in which the company is operating in the green. The companyâs not expected to post its first-half earnings until next month.
Flight Centre recently tipped its first-half underlying EBITDA to come in between $70 million and $90 million.
The post Is 2023 Flight Centreâs year to return to profit? appeared first on The Motley Fool Australia.
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More reading
- The Flight Centre share price has made a flying start to 2023! Should I buy?
- Here are the 10 most shorted ASX shares
- Could ASX 200 travel shares be set for a major boost in 2023?
- Should I buy Flight Centre shares for spectacular dividend growth?
- Here are the 10 most shorted ASX shares
Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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