The rising cost of living has failed to dampen Australian consumers’ enthusiasm for travel, with strong ongoing demand lifting sales at Flight Centre.

The travel retailer on Wednesday announced a 15 per cent jump in total transaction value – the price of travel services and products plus revenue – for the first half of the 2023/24 financial year to $11.3 billion.

Despite household budgets constricting across the economy, travel was outpacing other discretionary spending items, managing director Graham Turner said.

“At a time when discretionary budgets are typically tightening, travel remains an outlier and a priority spend for many,” he said in a statement.

Solid ongoing demand across leisure and corporate bookings and margin improvements were leading to stronger profits and shareholder value compared to pre-COVID, he said.

The group’s profit margin before tax of 0.94 per cent was the best first-half result in five years, helping propel underlying profit before tax to $106 million after recording a narrow loss in the prior corresponding period.

Its net bottom line result was a profit of $86.6 million, versus a loss of $19.8 million in the previous corresponding period.

Shareholders were treated to a 10c interim dividend, as part of a $425 million investment in capital management initiatives intended to reduce future dilution, interest expense and shareholder returns.

Flight Centre enjoyed a strong start to the second half, with total transaction value for the year on track to exceed the company’s record $23.7 billion result in 2018/19, Turner said.

“Positive lead indicators have also emerged, with international capacity expected to be back to almost pre-pandemic levels in Australia by the end of financial year 2024 and airfare prices decreasing – by an average of 13 per cent in Australia recently and about seven per cent globally over the first half,” he said.

– AAP