Severe cuts to public sector travel budgets are no reason for a travel management companies to panic, according to the chief executives of one the largest global agencies.
HRG boss David Radcliffe was speaking to ABTN this morning (May 26) after his company released its financial result for the year until March 31, which included 15% year-on-year increase in profits before tax and an overall 7% drop in total revenue.
Yesterday the new Chancellor of the Exchequer, George Osborne, confirmed that government travel budgets would be slashed as part of the effort to reduce the UK's burgeoning deficit.
HRG's contracts with the Ministry of Defense and the Foreign and Commonwealth Office were on Osborne's list of affected departments. But a bullish Radcliffe said the company was viewing the news "opportunistically".
"Whether there are cuts or not, there will still be a lot of work for us to manage [with the FCO and MoD]. Bear in a mind a lot of the work we do is to save them money. So we view this as an opportunity to get to other government departments to save them money. We believe we can help the government meet its objectives."
HRG's preliminary results revealed the company made £326.8 million total revenue for the year until March 31, down 7% on the previous 12 months.
Radcliffe said was pleased with the result, which sees investors receive 1.2 pence per share in dividend, and said the results were cause for "cautious optimism".
But he resented any suggestion that the strong performance was down to pure cost cutting.
"I prefer not to call it cost cutting," he said. "It's a reshaping the business.
"We took a view, like a lot of other industries, that our own revenue was going to go down, so what we needed to do was reshape the business to maximise the opportunity.
"If it was just cost cutting you wouldn't necessarily seen the margin increase at the same time."
He said he wanted the business to be "in the right place" to benefit from the economic upturn.
"We things began to turn we wanted to take some benefit. So we are cautiously optimistic. In the closing days of last year and the opening days of this year we have seen some signs of a pick up."
Radcliffe admitted that redundancies were necessary during the ‘business reshape' (according to HRG's annual figures the average number of staff employed by the Group including key management fell by 917 people to 5,319 between March 31 2009 and March 31 2010), but revealed that the company was now in a position to increase headcount in certain areas.
"We lost some people over the year, but since then we've made some incredibly good signings. So we are gently recruiting where necessary."
HRG boss David Radcliffe was speaking to ABTN this morning (May 26) after his company released its financial result for the year until March 31, which included 15% year-on-year increase in profits before tax and an overall 7% drop in total revenue.
Yesterday the new Chancellor of the Exchequer, George Osborne, confirmed that government travel budgets would be slashed as part of the effort to reduce the UK's burgeoning deficit.
HRG's contracts with the Ministry of Defense and the Foreign and Commonwealth Office were on Osborne's list of affected departments. But a bullish Radcliffe said the company was viewing the news "opportunistically".
"Whether there are cuts or not, there will still be a lot of work for us to manage [with the FCO and MoD]. Bear in a mind a lot of the work we do is to save them money. So we view this as an opportunity to get to other government departments to save them money. We believe we can help the government meet its objectives."
HRG's preliminary results revealed the company made £326.8 million total revenue for the year until March 31, down 7% on the previous 12 months.
Radcliffe said was pleased with the result, which sees investors receive 1.2 pence per share in dividend, and said the results were cause for "cautious optimism".
But he resented any suggestion that the strong performance was down to pure cost cutting.
"I prefer not to call it cost cutting," he said. "It's a reshaping the business.
"We took a view, like a lot of other industries, that our own revenue was going to go down, so what we needed to do was reshape the business to maximise the opportunity.
"If it was just cost cutting you wouldn't necessarily seen the margin increase at the same time."
He said he wanted the business to be "in the right place" to benefit from the economic upturn.
"We things began to turn we wanted to take some benefit. So we are cautiously optimistic. In the closing days of last year and the opening days of this year we have seen some signs of a pick up."
Radcliffe admitted that redundancies were necessary during the ‘business reshape' (according to HRG's annual figures the average number of staff employed by the Group including key management fell by 917 people to 5,319 between March 31 2009 and March 31 2010), but revealed that the company was now in a position to increase headcount in certain areas.
"We lost some people over the year, but since then we've made some incredibly good signings. So we are gently recruiting where necessary."
