CTM’s FY25 Revenue Slips 4%, EBITDA Falls $30m; Client Wins Surpass $1.6bn
Corporate Travel Management revises down its FY25 revenue outlook by 4%, citing tariff and economic uncertainties in North America and Asia, while strong client wins bolster confidence for FY26.
- FY25 Group revenue expected to be 4% below prior forecast
- EBITDA impacted by approximately $30 million relative to February targets
- Rest of World ex-Europe growth slowed due to tariff and economic uncertainty
- New client wins exceed $1.6 billion, surpassing annual target
- Client retention steady at 97%, share buyback ongoing
FY25 Outlook Revision Amid Global Uncertainty
Corporate Travel Management Limited (ASX: CTD) has updated its FY25 financial outlook, revealing a softer revenue forecast and a notable EBITDA impact. The company now anticipates Group revenue to be approximately 4% lower than previously forecasted, translating into an EBITDA shortfall of around $30 million compared to the targets outlined in its February 2025 half-year results briefing.
This revision primarily stems from ongoing economic and tariff uncertainties affecting key markets in North America and Asia. These challenges have dampened client activity in the Rest of World (RoW) excluding Europe, particularly during what is traditionally the busiest period of the year. Despite these headwinds, CTM expects RoW revenue and EBITDA growth to still achieve modest increases of approximately 5% and 10% respectively over FY24.
Europe and Client Wins Provide Bright Spots
In contrast to the RoW challenges, CTM’s European operations remain on track to meet previously announced targets, underscoring regional resilience amid global volatility. The company also reported that new client wins year-to-date have surpassed a total transaction value (TTV) of $1.6 billion, significantly exceeding the annual target of $1.0 billion. Approximately half of these new wins have originated in Europe, positioning CTM well for a positive contribution to FY26 group metrics.
Client retention remains robust at 97%, reflecting strong customer loyalty despite the uncertain environment. This stability is a critical factor as CTM navigates the tariff-related headwinds impacting its broader business.
Cash Flow Strength and Share Buyback Progress
CTM continues to demonstrate strong cash flow generation, consistent with its earlier guidance of 80-90% full-year cash conversion. The company’s ongoing share buyback program has seen approximately 5.8 million shares repurchased for $78.2 million since inception, reducing the total shares on issue to around 140.5 million. This capital management strategy signals confidence from the board despite the revised earnings outlook.
The updated outlook assumes that the tariff uncertainty affecting March and April activity will persist through the remainder of FY25, with no further deterioration in client activity expected in May and June. CTM plans to update its FY26 group metrics at the full-year results announcement in August, adhering to its standard planning timeline.
Investors and analysts will be closely watching how tariff developments and client activity trends evolve in the coming months, as these factors will be pivotal in shaping CTM’s near-term performance and strategic positioning.
Bottom Line?
CTM’s FY25 revision underscores tariff risks but strong client momentum hints at a resilient recovery ahead.
Questions in the middle?
- Will tariff uncertainties ease or worsen in the critical final months of FY25?
- How will CTM’s strong client wins translate into revenue and EBITDA growth in FY26?
- Could further share buybacks signal management’s confidence or a lack of alternative growth avenues?
