Automotive retail and finance company Turners Automotive Group has reported record full year earnings, as it captured a greater share of the market.
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Key numbers for the year ended March compared to a year ago:
- Net profit $36.4m vs $27.5m
- Revenue $342m vs $296.5m
- Underlying profit $44.1m vs $34.3m
- Full year dividend of 23 cents per share
"Despite the disruptions from the delta lockdowns last year and the more recent impacts of Omicron on both consumer demand, and our own operational resource, it's been a fantastic result," Turners chief executive Todd Hunter said.
He said the result was driven by its auto retail and finance divisions - both of which recorded double digit growth, as they captured a wider share of the market.
The company also saw double-digit growth in its its insurance business.
It managed to achieve higher margins in its automotive arm, as demand for vehicles outstripped supply.
There had also been a strong focus on sourcing used vehicles from the local market, which resulted in "owned" vehicle sales increasing by 25 percent on the year earlier.
Earnings from the finance business rose 14 percent because it said it was able to manage changes that were made to the Credit Contracts and Consumer Finance Act more effectively than its competitors.
Turners also saw a $18m gain in the value of its property portfolio. It expanded its network of dealerships in the past year, opening a new branch in Rotorua and had several new locations in the works.
The company's debt collection service was the only division of the company to record a fall in earnings, which it put down to historically low consumer arrears, but it expected "debt loads levels" to increase because of deteriorating economic conditions.
Looking ahead, Turners said the current financial year had started well despite the lingering effects of the Omicron outbreak on trading.
However, the economy was facing stiffening headwinds, as rising inflation and higher interest rates would likely to weigh on consumer spending.
Hunter said one of the great things about the used-car market was that it tended to be able to withstand economic pressures because used vehicles were a needs-based purchased.
The company expected to see upside from its new automotive branches in a market where supply was constrained but the shift in interest rates would affect short term margins in the finance business.
"We're still confident about the outlook for the business, especially over the next three to four years," Hunter said.
"We feel the business is in really good health and well positioned to withstand any of the challenges we might face in the broader economic environment."