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

[winner69]

Has anyone noticed on page 3 of the presentation, the graph on the bottom right says "Net Profit After Tax", but it's actually showing "Net Profit Before Tax".
Pretty amateur to get the title of the graph wrong.

Only bright sparks like you notice such things but not good form

On the same slide did you notice they put big ‘+24%’ etc against things like profit but don’t put anything next to the EPS number .....sneaky eh

[winner69]

Good comedy mate, thanks for the laugh. What profit growth, EPS is going backwards lol. Good luck, you'll need it.

Be fair - they are doing what they say they will do (like make heaps more money)

[JeremyALD]

Personally I think the result is fine. They obviously aren't going to make an immediate return on the $30m cap raise, it will take sometime.

[Beagle]

Only bright sparks like you notice such things but not good form

On the same slide did you notice they put big ‘+24%’ etc against things like profit but don’t put anything next to the EPS number .....sneaky eh

Like a used car dealer or a long term holder trying to jack up the price while he secretly laments the appalling lack of EPS growth...very sneaky.
The whole stock exchange is disingenuous because it completely glosses over the fact that the company's performance is lackluster and completely flat on an EPS adjusted basis. I suppose this is the sort of thing we should expect from a company selling used cars ?

Jeremy the EPS speaks for itself and the thing you have to remember is that with the use of weighted average EPS the extra $30m raised is weighted based on the timing of the raise and this company is a recidivist offender when it comes to raising capital and delivering lackluster EPS growth. The other thing to remember going forward is gains made in the last half are on the back of one off increases in revenue and profitability from the vertical integration of Autosure. You get those profit gains on new efficiencies from a more vertically integrated sale offering only once. How are they going to grow profit next year in a more competitive used vehicle market ?

High quality companies highlight real EPS growth, they don't attempt to dress mutton up like lamb. I think this is what it is, a very mature brand and Turners will continue to only battle against the ongoing trend for customers to do business with vehicles through online channels. In conclusion I really think the tide is going out on the traditional auction vehicle model due to the ongoing disruptive influence of Trade Me and other online platforms.

[percy]

A lot coming on stream.
Two new truck and machinery sites,in Wiri and Palmerston North are now operational,and an additional site is being developed in Hamilton.
New Turners Car Sales site is being developed in Porirua,and a new site acquired in Whangerei.
A new Buy Right site is under development in Penrose.
All these new sites will add to sales of not only truck,equipment and cars,but also finance and insurance.
It will also be interesting to see how Turners account for their development profits.In the longer term, I wonder whether they will realise these profits by sale and lease back of the properties.
Exciting future,and good see the funds raised being put to good use.

[LAC]

Remember that they raised a lot of capital which isnt used yet but the number of shares has increased. So in time the earnings will change when the capital is used but the number of shares will be the same

[blackcap]

Remember that they raised a lot of capital which isnt used yet but the number of shares has increased. So in time the earnings will change when the capital is used but the number of shares will be the same

There is that to consider... this HY profit should be evaluated on the old number of shares on issue, not the new number that we see now post the SPP and issue. So effectively EPS are growing.... All good after all.

[BlackPeter]

Remember that they raised a lot of capital which isnt used yet but the number of shares has increased. So in time the earnings will change when the capital is used but the number of shares will be the same

Spot on ... but never mind the ongoing management bashing exercise. Some people are just enjoying themselves ...

I do see lots of opportunities for TRA to come up:
+ Beneficiaries will get wealthier thanks the the new government and able to afford better used cars.
+ new wannabe students (incensed by the increased student benefits) will need cars
+ anybody yet seen a Labour built house? People still will need cars to sleep in ...
+ Labour governments always encourage spending ... more business for TRA!

All good - opportunity to buy some more?

Discl: holding, reasonable happy with the result and optimistic. As well - as percy rightly pointed out - there are a lot of new projects lined up to come online in the next 6 to 12 months - more earnings in the starting holes ....

[winner69]

There is that to consider... this HY profit should be evaluated on the old number of shares on issue, not the new number that we see now post the SPP and issue. So effectively EPS are growing.... All good after all.

Wrong - most of the new shares have not been included in the calculations


This years eps 13.36 cents calculated on 75.1 million shares (last year 13.40 cents on 63.6 million shares)

There are currently 84.7 million shares on issue - if they had used this the eps would have been 11.8 cents.

If they achieve $30m npat the full year EPS in F18 will be about the same as F17

They use weighted average number of shares over the period to do these calculations ....so allows time for those shares to earn some dosh.

[Beagle]

The hound reckons a lot of people on here don't understand how weighted average number of shares on issue works. Its weighted based on the amount of time in the reporting period the shares have been issued for, so shares only very recently issued like the $30m capital raise don't have much impact in EPS calculation this period. I agree with Winner and its disappointing to note only 11.8 cps if they had done their EPS this period on a straight numerical basis based on the current number of shares on issue, yes there's more profit coming but yes at the next reporting date the weighted average number of shares on issue will be a lot higher.

As I and others have cautioned several times this is a very capital hungry business that's generating very little last year real EPS earnings growth (4% if I recall correctly) and this year so far its going backwards. Share prices follow EPS not headline profit growth so anyone wondering why the SP is going backwards need no further explanation because promised headline growth is simply disingenuous on an EPS basis. The natural cynic in me that lurks just below the surface thinks that won't stop senior management and directors putting their hand up for more remuneration because look at all the profit growth we have created for you ! Someone hand me a Tui please !