Key points
- The Flight Centre share price is down in early trade
- The company's CEO Graham 'Skroo' Turner is planning a meeting today on possible legal action over the extended WA border closure
- The European Union removed Australia from a safe travel list last week
The Flight Centre Travel Group Ltd (ASX: FLT) share price is sinking today amid reports the company's CEO is reconsidering a legal challenge on the closed Western Australia border.
The company's shares are currently trading at $16.54, down 1.58% after plunging to a low of $16.30 just after market open. For comparison, the S&P/ASX 200 Index (ASX: XJO) is 0.42% lower at the time of writing.
Let's take a look at what might be impacting the travel company's shares today?
Will Flight Centre launch a legal challenge on borders?
Flight Centre is holding a meeting with lawyers on Monday to consider a legal challenge against the Western Australian government on its extended border closure, the Sydney Morning Herald reported.
As Motley Fool Australia reported on Friday, Western Australian Premier Mark McGowan has delayed the reopening of the state border indefinitely in an announcement Thursday night.
Chief executive Graham 'Skroo' Turner told the SMH:
I'm just fine-tuning this with lawyers … we think there'll be a lot of pressure on (McGowan) to announce a date.
If he announces the borders will open in March or April, we won't get the case heard before it's already open. But if he announces July or December or something like that, we'll have a much greater chance of success of getting into court before borders open.
The Flight Centre share price has been up and down in the past month as Omicron fears and border decisions, both interstate and internationally, have impacted investor sentiment.
Last week, the European Union removed Australia, Canada and Argentina from its safe travel list. However, each member state within Europe is free to make its own decision on these guidelines.
Mr Turner also considered a legal challenge on the WA borders in November but he put this plan on hold.
Mr Turner told the Australian Financial Review:
A constitutional challenge is a three to four month process. The earliest we could get a hearing was March so when they set February 5 we paused.
Looking at Flight Centre's ASX 200 travel share peers, the Qantas Airways Limited (ASX: QAN) share price is down 1.23% at the time of writing and Webjet Limited (ASX: WEB) is 1.96% lower. Meanwhile, Helloworld Travel Ltd (ASX: HLO) is down 2.86% while Corporate Travel Management Ltd (ASX: CTD) is having a better day so far, up 2.73%.
Share price recap
The Flight Centre share price has gained around 6% in the past year. In the past month, it has also sunk around 6% and is down around 4% in the past week.
Meanwhile, the broader ASX 200 Index has returned around 5% over the past 12 months.
The company has a market capitalisation of about $3.3 billion based on its current share price.
