Corporate Travel Management founder and long-time chief executive Jamie Pherous has resigned from the company amid a deepening overcharging scandal in the UK that could ultimately cost more than $150 million.
The Brisbane-based travel group, valued at around $2.3 billion before its shares were suspended, confirmed that Pherous’s departure was agreed mutually with the board. However, analysts and investors say the sudden exit raises fresh concerns about the scale of the company’s problems, particularly as trading in its shares remains halted.
Corporate Travel Management provides travel services to major clients including Wesfarmers, the Australian government and several UK public sector bodies.
Mark Wade, an independent equity market analyst, said the timing of the resignation was troubling. “An immediate managing director departure signals the possibility that the extent of the company’s troubles has widened, with no quick fix in sight,” he said.
Pherous founded the business in 1994 with just two staff, after becoming frustrated by poor corporate travel arrangements while working as a young accountant at Arthur Andersen. The company listed on the ASX in 2010 and expanded rapidly overseas, driving a surge in its share price and turning Pherous into one of Australia’s best-known travel entrepreneurs.
Over the years, Pherous sold more than $140 million worth of shares, funding a high-profile lifestyle that included luxury property, heli-skiing trips and a lavish 50th birthday celebration featuring Jimmy Barnes. At the last traded share price in August, he still held 16.5 million shares worth about $266 million, representing an 11.3 per cent stake.
Despite stepping down, Pherous will remain with Corporate Travel Management as a consultant for six months on his fixed annual salary of $675,000.
The resignation follows months of turmoil after the company’s new auditor, Deloitte, identified accounting issues linked to UK contracts. In November, Corporate Travel revealed it would need to reverse revenues booked in the UK over the past three financial years, including £58.2 million for 2023 and 2024 and a further £19.4 million under review for 2025.
The total refund bill has yet to be finalised, and the company has declined to disclose which customers were affected. The UK Home Office has confirmed it was overbilled and is investigating what it described as an “appalling overspend”.
Corporate Travel has held major UK government contracts, including crisis repatriation during the Covid-19 pandemic and, more controversially, the management of asylum-seeker accommodation, including the use of barges.
Company chair Ewen Crouch said the board believed new leadership was needed to strengthen governance and resilience. “While Jamie has played a pivotal role in the company’s success, the focus now is on continuing to evolve,” he said.
Ana Pedersen, the group’s chief commercial officer, has been appointed acting chief executive on a $1 million base salary while a permanent replacement is sought. Pedersen previously spent 16 years at BCD Travel, a background analysts say gives her relevant experience across travel and technology.
Pedersen acknowledged the seriousness of the situation, saying the company’s recent accounting challenges had “fallen short of expectations” and that controls and structures needed to be strengthened.
Investor confidence remains fragile. Corporate Travel has been targeted by short sellers for years over its accounting practices, allegations it had consistently denied before the current crisis. With shares suspended for more than six months and limited clarity on the company’s true financial position, some investors have already written down the value of their holdings, while others fear further losses once trading resumes.
The group says its priority is finalising its accounting review so its shares can return to the market, but the departure of its founder has added another layer of uncertainty to an already unsettled situation.