Corporate Travel confirms $223m in revenue reversals after accounting review
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The news: Corporate Travel Management said it expects to reverse GBP118 million ($223 million) between FY19 and FY25, up from an anticipated reversal of GBP77.6 million announced in November, following a months-long forensic accounting review by KPMG.
The numbers: Corporate Travel also said revenue of up to GBP10 million may be required to be reversed in the first half of FY26, depending on the outcome of ongoing discussions with certain customers.
The context: The company, which has been suspended from trading since failing to release its FY25 results in August, said the revenue reversals in question are isolated to its UK business, with no impact to other regions.
KPMG’s review concluded that customers were charged in excess of contractual entitlement and client funds were retained.
Corporate Travel said “significant changes” have been implemented within the UK business, including across financial controls and operational processes.
The company scrapped its guidance in November and dismissed its UK and Europe CEO Michael Healy a month later. Founder and managing director Jamie Pherous stepped down in February.
What they said: “The ongoing trading suspension and its impact on shareholders is deeply disappointing and a matter of serious concern for the board,” said chairman Ewen Crouch.
“We sincerely apologise to our shareholders and to affected clients in the UK for the circumstances that led to this situation.”
Acting group CEO Ana Pederson commented: “The issues identified within the UK business and the impact of the trading suspension on our investors, clients and employees remain my highest priority, and I recognise how disappointing this period has been for all involved.”
The source: ASX
