Sales and rental boost

Tourism company reports vehicle sales are continuing to perform well in New Zealand from a margin perspective. 

Global tourism operator Tourism Holdings Ltd (THL) has updated its forecast net profit for the 2023 financial year to be in excess of $30 million.

That includes the impact of an estimated $3.5m in costs related to its planned merger with ASX-listed RV operator Apollo Tourism & Leisure.

THL’s previous guidance in August indicated net profit after tax for the 2023 financial year would be between $17m and $30.2m.

The improved outlook is mainly due to performance in the first quarter of 2022/23 exceeding earlier expectations with tourism numbers up, and more certainty on forward rental revenue for New Zealand and Australia’s high seasons, the company reports in a statement to the NZX.

THL is the largest commercial provider of recreational vehicles for rent and sale in both countries. It's the second largest in North America where it owns Road Bear and El Monte.

Demand and rental yields for the summer season have been above prior expectations with year-to-date yields and bookings up by more than 35 per cent compared to the 2018 financial year – before the coronavirus pandemic – and up by more than 70 per cent on 2019 levels in Australia.

Vehicle sales are continuing to perform well from a margin perspective in New Zealand, Australia and the US, in-line with what was achieved in the 2022 financial year although volumes are down slightly.

The company has noticed a decline in retail-vehicle demand for its direct sales in the US. That said, it expects supply-chain issues for RVs to continue for longer this financial year, which is resulting in a shortage of stock.

Meanwhile, THL’s proposed merger with Apollo now looks almost certain to go ahead before the end of 2022 after being approved by the Commerce Commission and its equivalent in Australia despite earlier concerns over market dominance. Both parties have undertaken to divest certain assets to Jucy in a $45m deal.