Everything you need to know about the newly-reinstated Flight Centre dividend

Flight Centre has brought back its dividend at long last.

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It has been a while since Flight Centre Travel Group Ltd (ASX: FLT) shareholders have received a dividend from the travel agent giant.

For obvious reasons, the company hasn't been in a position to pay a dividend since the emergence of COVID-19 and the significant disruption it caused to travel markets.

But with Flight Centre revealing a return to profit yesterday, dividends are now back on the menu at long last.

The Flight Centre dividend

Yesterday, Flight Centre released its FY 2023 results and revealed a 127% increase in revenue to $2,281 million and underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) of $302 million.

The company's EBITDA was up $485 million from an EBITDA loss of $183 million a year earlier. It was also in line with guidance.

In light of this return to profit, the Flight Centre board declared a fully franked final dividend of 18 cents per share.

The company's shares will trade ex-dividend for this on 20 September. After which, this Flight Centre dividend will be paid to eligible shareholders the following month on 19 October.

Though, admittedly, it isn't much to get excited about. With the Flight Centre share price currently fetching $21.46, this 18 cents per share dividend equates to a yield of under 1%.

But that could change in the near future.

What's next?

According to a note out of Morgans, its analysts have updated their estimates to reflect the company's FY 2023 results.

This has seen the broker pencil in fully franked dividends per share of 49 cents in FY 2024 and then 84 cents in FY 2025. This represents dividend yields of 2.3% and 3.95%, respectively.

Morgans also sees plenty of upside ahead for its shares with its add rating and $26.00 price target.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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