The largest holiday vehicle rental business in New Zealand and Australia, Tourism Holdings (THL) has disappointed in recent years, but a merger has underpinned a turnaround in fortunes.
Craigs Investment partners broker Peter McIntyre said THL had been a ''perennial underperformer'', but after post-merger rationalisation of its expanded vehicle fleet, investors had growing confidence it was capable of delivering on its strategies and plans.
THL shares were up 7% at $1.20 after the announcement, having risen from 58c a year ago. The company said it expected to ''meet or exceed'' its February forecast for profit to rise to $10.5 million for the year ended June 30, from $3.8 million for the previous corresponding period. Net debt for the year to June 30 is expected to fall to $90 million, below THL's February forecast of $95 million, and down from $97 million in December.
THL booked a much improved result for the half year to December, with revenue up 4% at $112 million, and earnings before interest and tax up $1.9 million at $7.2 million, while its after-tax profit was $2.5 million, after a $500,000 loss a year earlier. THL's annual result is due for release on August 26.
