TRA - Turners Automotive Group [previously TNR - Turners Limited]

[kiwikeith]

Hi everyone time for me to step in again.

Not sure how this image was taken, probably not worth digging into that. This is basically a buyers guide for our car buyers and steers them on the cars to avoid (known mechanical issues...we get this data from our insurance business Autosure + experience) and who they need to get approval from internally to buy cars. Your comments are completely off the mark sashadidi. It doesn't signal anything about how tough or otherwise it is for Turners. What is does signal is that demand is shifting down the price point curve and moderating above for more expensive cars ($20k and above). Unsurprisingly used cars remain resilient but consumers have less to spend...it isn't rocket science and something we have been talking about for 18 months now. This internal document simply helps ensure we source cars where the demand in the market is and avoids the known problem cars...and we are doing this quite successfully as well.

As at the end of March the value of our inventory was down but stock units up. Mar-24 3,465 units @ average price of $7,200 (FY23 3,021 units @ average price of $8,600).

Absolutely fantastic to see a chief of a company commenting on an investor forum. Joey Agree from Agree Realty listed on the NYSE often comments on the seeking Alpha investor website. The effort is really appreciated. I bought a car (Prius) from Turners in Palmy late last year for $21k. I happy to learn I am the proud owner of a 'more expensive car".

[alokdhir]

Market up 1.75 % and TRA flat ...at least it stopped falling ...Friday shud be interesting ....

[winner69]

Our man Todd a big winner at Finance Professionals Awards

Suppose he had to step up after Tina winning awards lol

Well done Todd

Turners Automotive chief executive Todd Hunter, Westpac’s Kate Archer and Māori business leader Hinerangi Raumati were honoured for their leadership at the Institute of Finance Professionals (Infinz) Awards in Auckland tonight.
https://www.nzherald.co.nz/business/...DSPFTZHUNIPJY/

[alokdhir]

Market up 1.75 % and TRA flat ...at least it stopped falling ...Friday shud be interesting ....

Some excitement back for the results Tuesday ...over $ 4 and selling stopped ...sellers become wiser !!!

[mike2020]

Just looks like big seller done. Might turn out to have been a great opportunity.

[Jonette]

Hi everyone time for me to step in again.

Not sure how this image was taken, probably not worth digging into that. This is basically a buyers guide for our car buyers and steers them on the cars to avoid (known mechanical issues...we get this data from our insurance business Autosure + experience) and who they need to get approval from internally to buy cars. Your comments are completely off the mark sashadidi. It doesn't signal anything about how tough or otherwise it is for Turners. What is does signal is that demand is shifting down the price point curve and moderating above for more expensive cars ($20k and above). Unsurprisingly used cars remain resilient but consumers have less to spend...it isn't rocket science and something we have been talking about for 18 months now. This internal document simply helps ensure we source cars where the demand in the market is and avoids the known problem cars...and we are doing this quite successfully as well.

As at the end of March the value of our inventory was down but stock units up. Mar-24 3,465 units @ average price of $7,200 (FY23 3,021 units @ average price of $8,600).

My 2 Cents, unfortunately due to health problems I had to reduce participating, hopefully I can do more:

My data from Trademe confirms Todd's comments, Turners purchases by price band have moved exactly as he says. Price is not relevant to Turners, the key factor is margin on each car, so take my data and assume your own margins you may find more value. I assume turnover at lower prices being higher while margins may be lower, it will be interesting to see the net impact;
https://datawrapper.dwcdn.net/QdDwD/1/

Inventory across the market was farcically increased by a recent Trademe promo, but has retained quite high indexed levels compared to Turners. Meanwhile 2CC inventory is high for them.
https://datawrapper.dwcdn.net/GeaXh/104/

Further to comments above about subscriptions, Turners seems to be holding well in this market
https://www.datawrapper.de/_/NGtpq/?v=16

I update these charts regularly, but rarely on here - Datawrapper looks after them

[Sideshow Bob]

https://www.nzx.com/announcements/431370

Turners delivers record FY24 earnings and lays out roadmap for future growth

Turners Automotive Group (NZX/ASX: TRA) has again delivered record earnings for the financial year to March 31, 2024 (FY24), underscoring its resilient earnings platform, and the value of diversification, integrating the activity and annuity elements of its business.

Despite economic challenges and soft consumer demand, the company achieved its FY24 target a year early, is well placed to exceed its FY25 Net Profit Before Tax (NPBT) target of $50M and today announced its new medium-term target for $65m NPBT in FY28.Key

Financial Highlights:
● Revenue $417m +7%
● EBIT $58.6m up 12%
● NPBT $49.1m +8%
● NPAT $33.0m +1.5% (normalised NPAT $35.1M +8%)1
● Earnings per share (EPS) 37.7cps 0% (normalised EPS 40.2cps +7%)1
● Final dividend declared of 7.5 cents per share (cps)
● Full year dividend of 25.5cps +11%, representing a gross yield of ~9% per annum based on current share price ($4.10)1The legislative change to remove depreciation on commercial buildings has increased the effective tax rate to 33% for FY24. This is a one-off non-cash impact in FY24 only.

The effective tax rate over the last two years is between 27.5-28.5%. A normalised NPAT using FY23 tax rate of 28.5% would be $35.1M +8% and EPS would be 40.2 +7%.

Key Business Highlights:
● Auto segment profit was up 27% and constituted more than 50% of group profits. Driven by two new branches launched in FY24, improved sourcing, retail optimisation (from wholesale auctions to retail), growing brand strength, operating efficiencies and solid organic growth across the network.
● Finance segment has weathered the interest rate shock as we deliberately sacrificed some top line growth over the last two years to focus on higher quality borrowers, positioning the segment well as interest rates ease. Net interest margin (NIM) is expanding, following an inflection point during H2 and rate headwinds will now turn into tailwinds. Meanwhile, arrears remain significantly below industry benchmarks.
● Insurance segment increased contribution to profit as a well-tuned business with robust policy sales, well managed claims and improved investment returns. Notably claims cost inflation was offset by reduced frequency of claims.
● Credit Management business has turned a corner with debt load recovering in line with a tightening economy, particularly in SMEs. The business is well-placed for growth as the economy tightens and debt value load continues to increase.
● A strong culture remains a key advantage, ranking in the top 5% of consumer businesses globally using Peakon (employee engagement tool). 50% of the team took up the Employee Share Scheme offer.
● Outlook: An anticipated deterioration in economic conditions during HY25, combined with cycling against a high-growth HY24 comparative period arising in part from extreme weather events, means we expect HY25 to be testing.

Our near term focus remains on exceeding the $50M NPBT goal in FY25, despite the economic backdrop. Beyond FY25, Turners is well-placed to continue to make strong progress, thanks to the resilience of a diversified business model (activity and annuity), and clear strategy for further growth.

Turner’s FY24 result demonstrated strong earnings in challenging conditions, thanks to its resilient, diversified business model, and is well placed to implement its next phase of development and growth.Group revenue rose 7% to $417m, delivering a record NPBT result of $49.1m up 8% on FY23.

The Auto Retail segment achieved another year of 20%+ growth, with segment profit up 27% over FY23 to $31.8m. Although the Finance segment’s profit was down, revenue continued to grow, and further progress was made improving the quality of the loan book, and rebuilding lending margins. Insurance continued its steady growth of recent years with 15% profit growth. And Credit Management expanded of a low base, recording 9% profit growth.

Todd Hunter, CEO, said: “We’re pleased to continue to deliver another record result for shareholders. Our business is founded on delivering great experiences for our customers. We continue to innovate, gain market share and improve margins across all segments. In addition to the continued expansion of our activity businesses (Auto Retail and Credit Management), our annuity businesses (Finance and Insurance) have gained momentum. This underscores the benefits of our diversification strategy and ensures the resilience we need to grow, through all phases of the economic cycle.

“Our Auto Retail segment again excelled and is now entering a build phase for our next growth push. Our Finance segment has weathered the interest rate shock, continued to improve its credit scores and is now back into growth mode. Our Insurance and Credit Management teams continue to finely-tune these businesses to market-leading positions with future opportunity as the economic cycle tightens.

”FY24 Financial resultsNPBT for the full year increased 8% to $49.1m. Net profit after tax (NPAT) of $33.0m was up 1.5%. EBIT rose 12% to $58.6m.Earnings per share (EPS) for FY24 were 37.7cps, matching last year. The legislative change to remove depreciation on commercial buildings increased the effective tax rate to 33% for FY24. This is a one-off non-cash impact for FY24 only.A final 7.5cps dividend (payable in July) takes FY24 dividends to 25.5cps, up 11% on last year.

This meets the company’s dividend policy payout of 60-70% of net profit after tax (NPAT), and represents a yield of ~9% per annum based on the current share price.Grant Baker, Chairman, said: “This is an outstanding result for the business in light of the economic backdrop. The strength of our brand, and our distribution networks means we are ever more accessible and trusted by customers, offering strong adjacent opportunities.

The resilience of our diversified model leaves us well-placed for what comes next in the economic cycle. Our leadership position and strong balance sheet, means we can continue to invest for our next phase of growth, even in tough times, so that we remain ahead of the market as conditions begin to improve into the next year and beyond.

We continue to remain focused on returns to shareholders, as well as strengthening our platform for growth as we now implement our roadmap to NPBT of $65m at FY28. The economic conditions New Zealand is faced with are challenging but I have absolute confidence in the team to keep delivering.”

[Louloubell]

As expected and a solid result. Good outlook and a clear plan forward. A business everyone can understand and clear communication; no gobbeligook. I'm a long term and happy holder.

[percy]

A stunner with a very positive outlook.

[Sideshow Bob]

Sub $4 was good buying last week.