Turners set for record profit

Turners Automotive Group expects to set a new record for its annual profit before tax and is predicting the figure will be at least $44 million for the year to the end of March 2023.

This would eclipse the record $43.1m set in the previous year and follows what the company describes as consistent trading over the summer months, including ongoing strength in auto retail.

Turners’ statement to the NZX on March 7 reiterates the guidance given at the half-year results announced in November 2022.

“In November we expected profits to be at or slightly above the FY22 record result,” explains Todd Hunter, chief executive officer. 

“The company is now on track for FY23 profit before tax to be at least $44m.”

He adds trading in the current quarter, which runs from January through to the end of March, has seen no significant change to the market dynamics Turners was experiencing in the final three months of last year.

With regards to its auto retail division, Hunter notes car sales continue to hold up well, market share continues to grow across new and existing sites and margins are stable.

Its site expansion strategy was also “working well and developing a pipeline of further opportunities”.

The company has also updated the market on other areas of the business:

• Finance: The impact of a higher interest rate environment is increasing and the expected deterioration in arrears occurred over December and January. However, the loan book is stable and arrears improved in February. 

• Insurance: Claims continue to track below expectations and investment returns improving.

 • Credit: Debt load recovering, but more slowly than expected. 

Turners reports none of its branches or operations suffered any damage during the extreme weather events to have struck parts of the North Island this year.

Its damaged and end-of-life vehicle division teams in Auckland and Hawke’s Bay are supporting the company’s insurance vendors to deregister and sell insurance write-offs for parts and recycling. 

Hunter adds replacement demand for damaged cars, combined with the supply restrictions caused by the clean car standard is expected to be inflationary for used vehicle pricing and margins

“Our thoughts are with everyone across New Zealand impacted by Cyclone Gabrielle and the Auckland Anniversary weekend weather event, and especially our team in the Hawke’s Bay region,” he says. 

“We are pleased to report that our team and their families are safe and well.”