Tourism Holdings Limited (THL) has suspended its FY20 earnings guidance in response to economic “uncertainties” resulting from the Covid-19 pandemic.
The company had previously maintained its expectation for full-year net profit of around $24 million upon the release of its half-year result on February 28.
This factored in a forecast reduction in Chinese inbound tourists from February through to April 2020 due to the Covid-19 containment measures.
However, THL has now abandoned that guidance in light of the new travel restrictions announced related to the pandemic in its NZ, US and Australian markets.
“While we believe that this remains a possibility, there are too many uncertainties for this to remain as THL’s guidance.
“As a result we do not expect to provide financial guidance for the remainder of the FY20 year.
“Despite the challenges facing the industry, THL has a strong balance sheet with low debt levels, significant undrawn facilities and high quality asset backing,” the company says.
THL reported net profit of NZ$13.1 million for the FY20 first half to December 31.
This was down 25% compared to the $17.5m profit posted in the same period the previous year.
Vehicle sales revenue was down 6% to $59.1m while rental and service revenue was up 3% to $148.4m.
Underlying profit (EBIT) was down 11% to $31m and net debt was down 20% to $181m. Its interim dividend was down 23% to 10 cents per share.
THL is the largest provider of holiday campervans for rent and sale in Australia, New Zealand and the US. It is focused on establishing itself as a global leader in the recreational vehicle (RV) market.
THL has partnered with United States RV manufacturer Thor Industries through a 50/50 joint venture, named TH2.
It combines the assets of THL as the world’s largest renter of motorhomes and campervans and Thor as the world’s largest RV manufacturer.
The partnership also includes technology-based assets such as road trip planning software company Roadtrippers; booking, rental and fleet management provider Cosmos; peer-to-peer RV rental service Mighway and top Australia and New Zealand camping app, CamperMate.
Action Manufacturing, New Zealand’s largest vehicle manufacturer, is also half-owned by THL.
THL’s share price dropped around 30% on Monday trading to a six-year low of around NZ$1.40 per share.
