Turners plots network growth

Turners Automotive Group predicts the second half of the current financial year will deliver stronger vehicle margins and volumes as overall market demand improves.

Todd Hunter, chief executive, delivered the forecast to shareholders during a presentation at the company’s annual meeting on August 21.

The group is also preparing to acquire more sites as part of its ongoing push to expand its automotive retail network and increase its market share.

Conditional offers have been made for sites at Drury, Whanganui, Takanini and Ormiston, while opportunities are being explored for new locations in Albany north, north-east Christchurch and Lower Hutt.

There are also plans to expand the existing branch at New Plymouth.

The company says it has about $50 million in corporate funding capacity to support its branch expansion ambitions.

Hunter told the meeting, held in-person in Auckland and streamed online, that scale will be the key determinant of long-term success as overall dealer numbers drop due to weak demand and difficulty in importing cars from Japan.

The group’s outlook and future ambitions come after a record profit for the group in the 2025 financial year despite market conditions during that time being described by Hunter as challenging, in line with the macroeconomic environment. 

His report to the meeting says sourcing initiatives, pricing optimisation and stock management discipline during the first half of the last financial year set Turners up for margin expansion in the second half.

He notes the damaged and end-of-life segment also dropped from the previous year, due to more benign weather, while the commercial division benefited from increased liquidations and receiverships.

Other divisions

Hunter reports the total ledger for the group’s finance division is growing again but notes through challenging economic conditions, arrears have remained substantially below industry norms. 

At the same time, quality continues to improve with credit scores lifting and reduced higher-risk commercial lending.

In the insurance division, the company’s comprehensive motor insurance portfolio has increased by 25 per cent over the 2024 financial year, with sustained customer acquisition and retention. 

The group is also winning increased dealer and broker market share and a new digital platform has been launched, enhancing its direct-to-consumer capabilities. 

Hunter explains a combination of risk pricing and procurement have also helped moderate claims ratios. 

As for the credit management division, debt referred has increased in all sectors with corporate and small and medium-sized enterprise businesses feeling the impact of the economy on their arrears.

Outlook

Looking ahead, Hunter explains maintaining credit discipline for the finance divisions remains a key priority and it expects solid book growth for the 2026 financial year at stable margins. 

He also predicts the motor vehicle insurance portfolio, underwritten by Vero, will continue to grow strongly, while its credit management operation remains well positioned for the next stage of the New Zealand credit cycle. 

“The economy is still patchy … [but] despite these challenges we are still expecting a record first half performance,” he says.

The company expects a net profit before tax (NPBT) in the first half of the current financial year to set a new record for the company and be at least 10 per cent above the figure achieved in the corresponding period last year.

It also looks set to achieve its mid-term target of $65 million NPBT in the 2028 financial year ahead of schedule.

Servicing rebrand

Grant Baker, chairman, told the meeting the 2025 financial year’s result capped a decade of growth and was largely due to a resilient model and an outstanding team.

He notes used car market volumes have remained resilient, despite economic conditions, and the outlook for the 2026 financial year is a slowly recovering economy with further growth expected in Turners’ profits over the prior period.

Baker also announced that a rebrand of My Auto Shop, which it acquired a 50 per cent stake in last year, to Turners Servicing and Repairs is under way to leverage strong brand awareness and equity in the Turners brand.

“Turners Servicing and Repairs is now nearing break-even and we continue to invest aggressively for growth,” he adds.

“A marketing campaign is launching in September 2025 to drive awareness of the ease and convenience of mobile servicing.”