A Britz rental van on the shores of Lake Wanaka. Photo
Tourism Holdings Ltd has slipped into a $500,000
half-year loss as it perseveres with its long-running
restructuring programme and yesterday downgraded its full-year
after-tax profit expectations.
In October THL paid $69 million, with shareholder approval,
to acquire competitors United Campervans and Kea Campers,
which boosted its camper van fleet by 1000 vehicles.
THL planned to reduce its then fleet of 2500 by almost 30% to
1800, and yesterday booked an almost 70% increase of fleet
sales - from $18 million for the six months to December last
year to $30.5 million - from 665 motorhome sales.
The fleet sales underpinned the overall 8% revenue increase
to $78 million. Craigs Investment Partners broker Peter
McIntyre said while the result had been flagged and ''would
not surprise the market'', it was still ''very weak''.
Mr McIntyre was ''surprised'' THL had announced a 2c dividend
for the period when debt reduction ''had clearly been the
focus''. Its shares dipped 1c to 67c after the announcement,
on light volumes. THL's net debt had risen from $39 million
from mid-2012 to $134 million, which included $50 million for
the Kea and United purchase, with the equity ratio falling
from 49% to 42%.
''They are pushing on with restructuring. It's now looking
like 12 to 18 months out before the restructuring programme
is successfully bedded in,'' Mr McIntyre said.
THL chairman Keith Smith said the company continued to face
''significant challenges'' in the core inbound tourist
markets from Europe, the United Kingdom and the United
''However, we're satisfied our first-half result was on track
with expectations for the period. The success of the
[Kea/United] merger demonstrates THL is making good progress
reconfiguring the business for these conditions,'' he said in
The full-year debt targets are in line to fall from $134
million to $117 million, but the Australian business'
earnings will be below previous market guidance and the
after-tax profit forecast of $6.7 million would actually fall
within a range of $3 million-$4 million, Mr Smith said.
THL's six months trading to December
•Operating revenue up 8% from $100.7 million to $108.5
•Earnings before interest and tax, down 54%, from
$11.4 million to $5.3 million.
•Profit after tax down 112%, from $4.1 million to a
•New Zealand van rentals revenue fell 20% from $25.1
million to $20.2 million.
•Australian van revenues rose 1% from $37.1 million to
•United States van rentals grew 1% to $11.4 million,
from $11.3 million