FLT - Shed some light, page-45

Interesting to hear the management briefing today to get a feel for how they see the current environment, bearing in mind most of them have seen a number of ups and downs in the travel industry over the years (Sep 11, SARS, GFC etc.)

I must say that management came across as being very unperturbed by the current lacklustre level of demand in the leisure business. They believe we are seeing a cyclical fall in demand in the Australian leisure business due to low consumer confidence. Essentially consumers are still enquiring, but the conversion to sales is not as strong as expected. This happens from time to time, and management believe that this is temporary in nature (Australians' love for holidays is not likely to fade).

Generally the overseas business are said to be performing very well, and importantly, upside from earnings in strengthening foreign currencies has not been factored into earnings estimates.

My key takeaway, as a long term holder, is not only what management are saying but what they are doing. They continue to invest in the business, growing worldwide store numbers and building their brand. There is no structural change to the industry and FLT will remain a force when it comes to travel retailing IMO.