Flight Centre Shares in Australia's Overseas Passenger Boom

Shareholders in travel group Flight Centre have shared in the boom in Australian's flying overseas in increasing numbers to take advantage of the higher Australian dollar.

Overseas passenger movements were up 11% in the year to June 30, according to the Australian Bureau of Statistics.

Flight Centre yesterday reported a flat result for 2010-11 but upped final dividend to 48c(fully franked) from 44c in 2009-10.

That brought the full year payout to 84c a share, fully franked, up from 70c, fully franked, the year before.

(It's not a record, the company paid 87c a share back in 2001.)

The market liked the news and the forecast for the coming year and the shares jumped more than 5% in early trading to a high of $18.91 before easing to close up 3.7% at $18.66.

Flight Centre revealed a net profit for 2010-11 of $139.81 million, down from $139.868 million in 2009-10.

Flight Centre said it's looking for a 10% improvement in "underlying profit in the current year".

Revenue in 2011 was up 4% at $1.862 billion, with the value of total transactions up 12% at $12.2 billion.

Profit Before Tax rose 19.6% to a record $245.2 million from just over $205 million the year before.

"Generally, FLT's corporate travel businesses performed strongly globally, as the company benefited from its continued expansion in the sector and as the overall market continued to recover from the 2008/09 downturn," Flight Centre said in a statement.

"In leisure travel, sales volumes were generally good with strongest growth achieved in Australia and Canada, where market conditions remained reasonably stable."

Flight Centre said its result "was two per cent above the top-end of (Flight Centre's) initial guidance of an underlying PBT between $220 million and $240 million (excluding any major abnormal items that may arise) and in line with the $243 million to $247 million range announced on 15 July 2011)".

Flight Centre said it performed "in line with expectations in July".

It said it expected PBT of $265-275 million, excluding abnormal items, in the full year.

In contrast to Flight Centre, a flat result saw Sonic Healthcare's shares pounded yesterday.

They fell more than 7% at one stage to a low of $10.78 before recovering a little to close at $11.29, off 23c or 2%.

The culprit was the little changed reported profit at $294.5 million for the 2010-11 year, up 0.4% from the previous year.

A forecast for a 15% improvement this year didn't cheer investors, who ignored it, judging by the whacking given the shares in yesterday's firmer market conditions.

In constant currency terms, net profit rose 6.1% (which averages out the exchange rate over the year and the previous year).

With overseas operations in NZ, the UK and Europe, the strong Australian dollar was clearly the big factor.

Chief executive Colin Goldschmidt said in yesterday's statement that the company performed well in challenging financial markets and with the strong Australian dollar.

The company said the dollar hit revenue by $198 million in the year to June.

The Australian pathology business delivered significant margin improvement in the second half of the 2010-11 financial year after a poor performance in the first half, he said.

''At the business level, we expect to achieve ongoing growth and margin expansion in our major markets, thus reaping the benefits of the significant investment in acquisitions and infrastructure we have made over recent years,'' Dr Goldschmidt said.

Revenue grew the Australian, US and European pathology businesses, on a constant currency basis. Revenue fell in NZ.

Revenue rose 9.8% from the previous year to $3.096 billion (on a constant currency basis) and earnings before interest, tax, depreciation and amortisation (EBITDA) were $570.01 million, up 5%.

The company forecast EBITDA growth of between 10% to 15% for the 2012 year, on a constant currency basis.

An unchanged final dividend of 35c was declared, (franked to 28%).

The interim was a steady 24c a share, making a total for the year of a steady 59c a share.

Internet jobs group SEEK lifted profit 9% in the year to June and says it is well positioned to take advantage of the continuing shift of jobs ads to online.

The company said yesterday net profit after one-off items for the 12 months to June 30, 2011 was $97.69 million, up from $89.52 million in the prior year.

The company said before one-offs, earnings were $104.6 million.

The company declared a final dividend of 7.5c per share, fully franked, up from 6.5c for the final half of the 2010 financial year.

With the higher interim of 6.8c a share (5.2c), total payout for the year is 14.3c, up sharply from the 11.9c a share paid in 2010.

Despite that good news, investors sold down the shares which shed nearly 4% or 22c to $5.36. The wider market rose 2.2% in a solid day of trading.

SEEK chief executive Andrew Bassat said in yesterday's statement there had been a "sustained and consistent trend in growing job ads" over the past 12 months.

"SEEK is well-positioned versus its online peers and particularly against print as growth in online job ads has significantly outpaced growth in print job ads," Mr Bassat said.

"This reflects the ongoing structural migration from print to online with online now capturing approximately 83 per cent of all job ads."

SEEK operates three main businesses: the Australia and New Zealand jobs listings website, an education unit that offers teaching courses and student recruitment, and an international arm that holds SEEK's interests in offshore ventures.

"Despite the volatility in macroeconomic conditions, I expect SEEK to outperform its online and print peers given its market leading position and exposure to favourable structural trends," Mr Bassat said.