Tourism Holdings Result: Profit slides, coronavirus means outlook uncertain

Tourism Holdings has a big motorhome fleet in NZ, Australia and the US. Photo / Supplied

Tourism Holdings interim net profit has slumped by 25 per cent to $13.1 million.

The company says the hit to profit was largely due to largely to the US vehicle
sales market and ongoing investment in Togo Group, an RV app.

It today has re-iterated a warning about a fall in full-year profit.

The company expects annual net profit will be down about 14 per cent because of the coronavirus impact on tourism, the Australian bushfires and the previously advised problems in its US business.

It has cut its dividend from 13 cents a share to 10 cents a share.

TOURISM

Chief executive Grant Webster said the company had a strong balance sheet and market position.

''We have confidence in the future of [the business], despite the difficult trading environment in some markets at present. The teams globally are intensely focused on performance and delivery in every aspect of the business".

Webster and chairman Rob Campbell said the global situation with Covid-19 continued to
remain uncertain, however, at this stage, the company did not consider there to be any additional information that causes any change to its full-year assumptions.

Thl chief executive Grant Webster. Photo / Nick Reed.

The impact of this coronavirus outbreak has been greatest in the Waitomo business which attracted large numbers of Chinese visitors.

The Australian bush fires caused cancellations in late January and February, but the greater concern was the lower forward bookings from the long-haul markets.

''We have since experienced a rebound and do not expect the impact to be material to
the total business in the remainder of this financial year.''

It is not only leisure travel that is affected by the coronavirus outbreak. Overnight more details of corporates cancelling trips for staff out of duty of care obligations were reported.

Swiss food giant Nestle, the maker of Nespresso, Kit Kat and San Pellegrino, told its 291,000 employees worldwide not to travel internationally for business until March 15, while domestic travel should be replaced by "alternative methods of communication where possible." French cosmetics maker L'Oréal, which employs 86,000 people and owns the Maybelline and Lancome brands, issued a similar ban until March 31.

The coronavirus has spread to more than 50 countries and infected more than 80,000 people since the first outbreak in Wuhan in central China.