Flight Centre warns on profits

The travel retailer's share price has plunged after it reported that a margin squeeze will cause profits to fall this year.

You'd think an airfare price war would be good for Flight Centre, and you'd be right in as much as it stimulates overseas travel – but it seems that too much of a price war can cause it to miss its 'super overide' volume-based bonus commissions from airlines. And unfortunately on this occasion the extra stimulus to travel has been thwarted, says management, by uncertainty due to the election in Australia, the 'Brexit referendum in the UK and the Zika virus in central and south America (important markets for the US business).

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