The corporate travel specialist's shares fell almost 7.5% to $16.68.
Why did the Corporate Travel Management share price sink lower today?
As well as being caught up in the market selloff, investors were selling Corporate Travel Management's shares following the release of its annual general meeting presentation.
At the meeting, the company released an update on its performance during the first quarter of FY 2021.
According to the release, during the first quarter, Corporate Travel Management averaged revenue of $9.6 million and an underlying earnings before interest, tax, depreciation and amortisation (EBITDA) loss of $2.4 million per month. This led to an average cash burn of $5 million per month for the period.
Pleasingly, trading conditions have been improving, with the month of September its best since COVID-19. During the month, the company's underlying EBITDA loss reduced to $1.6 million and its cash burn lowered to $3.5 million. But judging by the share price reaction, investors may have been expecting an even stronger month.
How are its operations performing?
Management revealed that its Australian operations have been performing positively during FY 2021 and were profitable during the first quarter.
Elsewhere, the company's European operations are close to breakeven now and its US operations are experiencing positive activity.
Finally, its Asia operations have been struggling, but look set to be boosted by a Singapore-Hong Kong travel bubble in the near future.
Despite its cash burn, Corporate Travel Management's balance sheet remains strong. It has $120 million net cash and an additional $181.8 million in an unused committed facility.
Travel and Transport acquisition.
The company also provided the market with an update on its acquisition of US-based Travel and Transport.
The A$274.5 million acquisition of the leading North American corporate travel business is expected to complete on 30 October.
Management continues to expect it to be earnings per share accretive on a pro-forma calendar year 2019 basis. Pre-synergies it expects 10% accretion, post-synergies it is forecasting 30% accretion.
No guidance was given at the event, but the company's Chairman, Ewen Crouch AM, spoke positively about the future.
In his closing remarks, he commented: "This turbulent year has highlighted the benefits of CTM's highly flexible and resilient business model. The period ahead will undoubtedly present many challenges and opportunities. We have a clear purpose and a sound strategy and we are well positioned to return to profitability with a modest recovery of domestic travel this year."