Turners Auctions 2008 Full Year Results Summary

Turners Auctions Limited 2008 Full Year Results Summary

Turners Auctions today announced its full year net profit after tax of $1.1m, down 53% on the same time last year.

In the circumstances this result, although down in dollar terms, is considered satisfactory given the extreme changes in the car market through 2008.

The New Zealand used vehicle market has experienced unprecedented decline over the last 12 months resulting in substantial consolidation and withdrawals of dealer and finance organisations.

The total used vehicle market dropped 100,000 units or 9% from 2007 with a primary contributor being the rapid decline in Japanese used import vehicle sales in New Zealand (down 25%).

Despite this, the company continued to generate strong cash flows, with an increase in net cash inflows from operating activities to $9.4m from $3.2m in 2007. This provides a strong foundation for the business to outperform others in the auto industry.

Throughout 2008 significant resources have been applied to position the group for future growth. These investments have focused on the online capabilities of the business including new website, online marketing strategy and upgrade of online bidding application (Turners ‘Live’).

In addition a large investment was made in promoting the Turners brand to new types of customers. Whilst this affected short term profits the business is starting to see the positive impacts of these activities.

Significant cost savings have come from restructuring business units to align resource levels to the current market environment. This includes consolidating branches and staff reductions.

The company has won important new customers in the lease and rental car and finance industries.

Government business continues to be strong (up 24% in 2008) as are sales of repossessed vehicles (up 100% in 2008).

As an expression of confidence in the company’s position the directors have declared a final dividend of 0.4 cents per share and a special dividend of 4.6 cents per share, both fully imputed.

This brings total dividend payments for 2008 to 7.5 cents per share.
Results summary:
• Operating Revenues $78 million, down 9%
• Group Net Profit After Tax $1.1 million, down 53%
• Total Group Assets $42 million, up 5%
• Final dividend payment 0.4 cps and special dividend of 4.6 cps payable 9th April 2009

ENDS

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