The Corporate Travel Management Ltd (ASX: CTD) share price is surging higher today after the company's boss flagged the resumption of dividends.
At the time of writing, the Corporate Travel share price is $24.38, 1.63% higher than its previous close.
Let's take a closer look at what's got the market excited about Corporate Travel's stock.
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Corporate Travel's dividend hopes
During Corporate Travel's annual general meeting (AGM), its chair Ewan Crouch noted the company expects to return to profitability during financial year 2022.
If expectations come to fruition, it will resume handing around 50% of its after-tax profits back to shareholders.
On Corporate Travel's return to profitability and dividends, Crouch commented:
We have zero debt and sufficient cash to manage recovery… Subject to remaining travel restrictions lifting in accordance with announced timetables and our key travel markets remaining open, we are targeting continued improving profitability over FY22 enabling dividends to resume following the release of FY22 results.
Its Australian and New Zealand markets have been a drag through this financial year so far due to ongoing lockdowns. Though, the company expects travel in the region to bounce back fast once borders reopen.
Additionally, some of its overseas businesses have been outperforming.
A strong first quarter for the company's North America and European legs has continued into the current quarter.
Its North American division is on track to achieve its biggest profit since the pandemic began this month. The company's now waiting for the United States' international borders to reopen on 8 November. It's currently selling more than 3,000 tickets for Transatlantic travel each week.
Meanwhile, its forward conference and events bookings in Europe are at an all-time high.
Now, the company is waiting for Australia's vaccination rates to increase ahead of borders reopening. It's expecting a rapid rebound in the second half of this financial year.
Corporate Travel also noted it will be reopening as a larger business than it was pre-COVID. It acquired United States' travel management company Travel & Transport in October 2020.
The Corporate Travel share price gained 10% on the back of the acquisition.
Finally, the company believes its market in Asia will continue to struggle over the near future. It hopes it can return to profitability when China opens its borders to the rest of the continent.
Corporate Travel share price snapshot
Today's gains included, the Corporate Travel share price is 41% higher than it was at the start of 2021.
It has also gained 52% since this time last year.
