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Shepparton Flight Centre branches will remain open despite closures

By Charmayne Allison

Mar 13, 2020

Flight Centre branches in Wyndham St and Shepparton Marketplace will remain open, despite shock news the travel agency will close 100 outlets in response to the coronavirus outbreak.

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The announcement was made on Friday, with Flight Centre also reporting it had scrapped its earnings guidance and would encourage staff to take leave or switch to part-time work.

However, a spokesperson from the Shepparton branches said it was "business as usual" and assured local stores would not close.

The agency reported 100 "under-performing" leisure shops would shut before June 30, with affected staff to be transferred to other outlets.

The company did not confirm how many jobs or which specific branches were at risk.

It is one in a string of cost-cutting initiatives the agency has adopted, including short-term strategies such as reducing trading hours in some leisure shops and freezing recruitment.

Directors will also forgo 30 per cent of their fees for the remainder of the financial year.

Flight Centre, which also includes Escape Travel and Student Flights, said the agency had experienced a softening in bookings since the coronavirus outbreak, which was expected to continue until at least April.

While the outlook and time-frame for recovery remains unclear, managing director Graham Turner said Flight Centre was "well placed" to overcome the challenges.

“Within this uncertain environment, our priorities are to reduce costs, while also ensuring that we and our people are ready to capitalise when the step discounting that is under way across most travel categories starts to gain traction and as the trading cycle rebounds,” he said.

“As we saw with both SARS and the global financial crisis in Australia, the rebound can be relatively fast and strong after a fairly significant downturn in international travel.”

In a statement to the sharemarket, the company advised the virus would have a sizeable impact on FY20 second half earnings.

“The virus's spread and the subsequent increase in travel restrictions ... made it more difficult to predict the virus's likely full-year impact or a time-frame for recovery,” Flight Centre said.

“Given this uncertainty, the company has elected to suspend its revised FY20 guidance.”