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September 2022, Virtual
September 29 2022, Virtual
Market remains "challenging"
Hogg Robinson Group (HRG) today (July 29) said its client revenue for the first four months of its financial year was 7% below expectations.
In a statement the publicly quoted travel management company (TMC) said market conditions in the first four months of the financial year from April 1 "remained challenging."
The statement was issued ahead of the company's annual general meeting today.
It said many clients were cutting travel spend with some imposing "bans and constraints...due to early concerns regarding swine flu."
The statement added:"The combined effect meant that client revenue in the first quarter of the financial year was approximately 7% below our expectations, excluding any currency impact.
"Given the depth of the global recession, we are also seeing some pressure from suppliers as they seek to reduce their distribution costs."
HRG said it was monitoring its costs and had cut staff both last year and again this year.
It said it was ready to take further action to lower costs as necessary but added that it also wanted "to maintain sufficient capacity to be able to respond quickly when the recovery starts."
The TMC said that in terms of new business, the financial year had "started well with new client wins and regional extensions including BNP Paribas and Discovery Communications."
The company said won a significant new UK government client and had also won a major contract with a North American financial services company.
HRG said that the focus of most clients was on ways to cut travel costs but the trend towards outsourcing travel management "remains healthy both in the short and longer terms."
It said the majority of its earnings "traditionally come in the second half of the financial year."
It added: "At this early stage of the financial year, the Board considers that the Group will deliver a full-year performance in line with expectations."
HRG shares stood at 22.75p this morning, a fall from its peak of 31.8p in early June.