Tourism Holdings lifts annual profit forecast to $17 million

Thursday 18th December 2014

Tourism Holdings, the biggest campervan rental company in Australia and New Zealand, has lifted its forecast for first half and annual earnings for a second time on favourable trading conditions.

Annual profit will be at least $17 million in the year ending June 30, 2015, the Auckland based company said in a statement. That's higher than its November range of between $15 million and $16 million, which was itself an upgrade, and would be at least 53 percent higher than the $11.1 million it recorded this year. That profit growth would follow a 192 percent rise in earnings in the 12 months ended June 30.

It expects net profit to be $5 million in the six months ending Dec. 31, up from its November guidance range of $4 million, and double last year's reported $2.5 million.

Tourism Holdings has improved earnings across its business by selling off excess fleet capacity and lifting its profit margins. The company is looking to leverage earnings from New Zealand's booming tourism market to fund growth in the international motorhome market. The company said it expects profit increases in the coming year to be led by growth in its local and Australian rentals businesses, as well as cost cutting.

The shares were unchanged at a six and a half year high of $1.75 and have climbed 86 percent since the start of the year. Tourism Holdings has announced an interim dividend of 5 cents per share, up from 2 cents a year earlier. In 2007 shareholders rejected a takeover bid by Australian company MFS Living and Leisure when the shares were at $2.80.

BusinessDesk.co.nz

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