Travel agent Flight Centre will close up to 100 stores across Australia as the Covid-19 crisis continues its rapid spread.
The company blamed “heightened uncertainty surrounding the coronavirus” in a statement to the ASX. It said “up to 100 under-performing leisure shops” will close.
Global share markets have taken a beating in recent days, with markets spiralling more than 20 per cent lower, and into a bear market.
Flight Centre employs 20,000 people internationally, but its bottom line has been hit by the domino effect of coronavirus.
Airlines including Virgin and Qantas have severely cut flights globally, as countries close borders. And Flight Centre and Webjet have been among the companies bleeding out on the stock market, both falling nearly 20 per cent in Thursday trade.
“Virus’s spread & increased travel restrictions mean demand is softening significantly and time frame for recovery is unclear,” the Flight Centre statement continued.
The company has suspended its 2020 fiscal year guidance.
“We are now seeing significant softening and expect this to continue into April at least,” managing director Graham Turner said.
“Within this uncertain environment, our priorities are to reduce costs, while also ensuring that we and our people are ready to capitalise when the steep discounting that is underway across most travel categories starts to gain traction and as the trading cycle rebounds.”
Likening the current climate to SARs and the GFC, Turner said the rebound may be “relatively fast and strong” following the major travel downturn.
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