The US business was one bright spot, THL said
Tourism Holdings has posted a net loss of $14.5 million for the June year, down $35m on last year's $27.36m profit, as it focuses on domestic growth opportunities currently curtailed by another nationwide lockdown.
Net earnings more than halved to $40.4m amid the Covid ravaged industry and loss of 90 per cent of the company's normal business. On the plus side, net debt at year end shrank to $49m - down 62 per cent on the $128m held this time last year.
Tourism Holdings (THL) is the largest provider of recreational vehicles for rent and sale in Australia and New Zealand, and the second largest in North America.
It is also a joint venture partner in Action Manufacturing LP, New Zealand's largest motorhome and specialist vehicle manufacturer.
Some highlights during the year included record vehicle sales revenue and volumes, with growth in average sales margin per vehicle in all countries and a strong US performance.
New Zealand Rentals and Tourism continued to be challenging given the reliance on international tourism, THL said in its presentation.
Total revenue of $359m was down 10 per cent on the $401m recorded in 2020 and earnings before interest, tax, depreciation and amortisation fell 64 per cent to $40.4m (2020: $111.7m).
Chairman Rob Campbell said he was pleased with the result given the circumstances within the context of global tourism.
"We have continued to adapt, manage the balance sheet and retain opportunities for the future.
"However, we recognise the uncertainty regarding the outlook for international tourism, particularly for New Zealand and Australia. The United States appears to be close to reopening and the current increasing vaccination rates in New Zealand and Australia are clearly positive.
"In the interim, thl remains a company with a carefully managed balance sheet that is strong for our industry segment and has a company value that is supported by a base of tangible, realisable and in demand assets that are being sold well in excess of book values."
Chief executive Grant Webster said the company was moving forward, taking the opportunities that exist while continuing to challenge and adapt as required.
"We have capitalised on the relative category growth for the RV experience and improved our vehicle sales expertise to deliver a record sales year, while managing our rental fleet to the prevailing domestic conditions within each country.
"A key priority for the year has been keeping customers and crew safe from COVID-19. We are very pleased to have had no traceable cases linked to our operation from any of our 40 locations globally. Despite the challenging times and uncertainty, our crew have adapted and delivered.
"Regardless of the demand environment today our belief in becoming Future-Fit remains, and is directing us on what we believe is the right path, ensuring we will be sustainable in all aspects of the business as we reset and prepare for the years ahead."
A lower level of capital raised alongside a higher spend on beefing up its IT security has weighed on the half-year profit of the NZX.
The stock exchange operator reported a net profit after tax of $7.6 million for the six months to June 30, down 16 per cent on the first half of 2020 which was a bumper period for the stock exchange.
Its operating earnings were down 3.5 per cent to $16.9m with the amount of capital raised down 10.6 per cent to $7.3 billion for the half. While its trading activity was down 2.8 per cent from the 2020 first half which had been a record period for trading.
Chief executive Mark Peterson said the NZX was continuing to make progress on building a diversified financial markets infrastructure and services business.
"Our achievements and results for the half-year 2021 reflect this ambition, with strength across all our business activities."
Its Smartshares business grew funds under management by 44.3 per cent while assets in its NZX Wealth Technologies business rose 151 per cent.
Group revenues were up 10.6 per cent to $42.5m while operating margin was lower at 39.9 per cent due to investment in its growth as well as an increased spend in people and technology.
During the half year four new companies listed on the exchange - My Food Bag, NZ Automotive Investments, Third Age Health and DGL Group.
Peterson said the Covid crisis had demonstrated the clear value of being listed on the NZX through providing access to capital.
"We believe this is a factor, along with NZX's origination activity, in the growth we are
seeing in new listings."
Equity capital raising activity fell sharply in the first half of 2021 after a very high level of activity in 2020 but its primary capital raisings rose 46.9 per cent to $3.4b helping to offset the fall in secondary issuance fees.
Peterson said a lift in the market liquidity had been helped by an increase in investment in trading technology from stockbroker participants.
"For many years, the New Zealand capital markets have been looking to grow the number of retail investors connected to our markets. Recent growth has been stimulated by the growing popularity of online trading platforms – Jarden Direct, Sharesies and ASB Securities – that enable easy and low-cost access to the New Zealand markets for DIY investors."
Peterson said the deeper participation, and activity from local and offshore institutional investors, had been mirrored in greater demand for NZX data with notable – growth from the US, Australia, Hong Kong and Singapore.
He said with both retail and institutional investors looking for a wider range of investment opportunities there was optimism about the potential for further listings
through the remainder of FY2021.
Cyber attack
NZX has also been working on its technology and operating platforms. The stock exchange suffered major daily outages this time last year after its was subjected to a cyber attack.
In January the Financial Markets Authority released a damning report which said the New Zealand Stock Exchange had been caught short on technology and skilled staff - and that the DDoS attack was foreseeable but not planned for.
It also found what it called "cultural" problems, including being secretive about problems and failing to appreciate their effect on market participants.
Peterson said subject to the release of the FMA report the NZX has received approval for its action plan from the FMA in May.
This plan contained a number of actions relating to NZX's arrangements for governance oversight, industry engagement, information technology capability, IT security, specialist skill sets, crisis management planning and risk management.
"We remain focused on delivery of the agreed steps under the action plan, and we are providing regular progress reports to the FMA in respect of the implementation of the
actions under the plan," Peterson said.
It had also worked closely with the industry and technology partner Nasdaq, to implement an upgrade to a new trading system in early August 2021.
"This major upgrade has delivered a new trader front-end, additional capacity and new functionality – and is expected to have a positive impact on on-market traded
liquidity from later in 2021."
It expects full year operating earnings to be in the range of $32m to $35.5m. It will pay an interim dividend of 3 cents per share on September 24.
Leadership changes
Shortly after its results the NZX also announced changes to its leadership team.
Peterson said he had completed a review of the NZX Senior Leadership Team and made several adjustments to better position the business to deliver on its strategic ambitions.
Peterson's contract has also been extended to April 2021 and as well as the establishment of the New Zealand Capital Market Centre as NZX's new Auckland office Peterson would be based out of Auckland in the coming months.
As part of his employment extension Peterson has been issued with a further tranche of performance rights under NZX's Long Term Incentive Plan. Vesting of the performance rights is dependent on NZX meeting a performance hurdle in respect of total shareholder return (TSR) growth, and Peterson remaining an employee of NZX for the duration of the vesting period.
NZX chair James Miller said the long-term incentives granted to Peterson were aligned to
the delivery of NZX's strategy and to ensure the company was committed to generating long-term value for its shareholders. The details of his pay package will be released in its annual report.
Strong home lending and deposit growth, and an anticipated release in bad debt provisioning has helped boost Kiwibank's full year profits by 121 per cent.
The bank has reported a net profit of $126 million for the year to June 30, up from $57m in the prior financial year.
Chief executive Steve Jurkovich said a combination of strong lending and deposit growth, cost discipline, benefits from technology and digital investments, as well as the anticipated release of bad debt provisioning for Covid-19, all contributed to the positive result.
The bank grew its overall lending by $3 billion, up 13 per cent, with residential mortgage lending growth of $2.2b, up 11 per cent, while business lending was up $0.8b or 51 per cent.
Kiwibank's operating income rose from $533m to $577m while its operating expenses were also up from $408m to $422m.
A credit impairment loss of $51m had turned into a reversal gain of $19m during the 2021 financial year.
Jurkovich said the bank had assisted more Kiwis with their homeownership aspirations than ever before.
"The strong housing market has played a significant role, as well as our consistently competitive and market-leading interest rates.
"In addition, the focus on growing our frontline banking expertise and starting to expand our reach via advisers, demonstrates our changing business and the shifts we are making to better meet customer preferences, as well as how we are showing up to help more Kiwi homeowners in a variety of ways."
Jurkovich said the record growth in business lending of $0.8b was off a relatively small base compared with competitors and was driven by customer confidence in Kiwibank's ability to deliver what they needed.
"Many businesses have had to adapt to the ever-changing environment. While it's been a challenging time for businesses, many have had strong performances."
Jurkovich said he was pleased with the progress but it was just the start.
"Our focus is to support even more Kiwi businesses to grow, invest or diversify in the year ahead."
Lockdown support
Jurkovich said the bank was working hard to support any customers impacted by the latest level 4 lockdown and acknowledged the anxiety and uncertainty that many customers were likely to be feeling.
"We urge customers worried about their financial situation to get in touch so we can work through the options available."
Last year the bank provided support to over 6000 personal and 2000 business customers. It also approved close to its allocation of Business Finance Guarantee Scheme loans supporting nearly 180 businesses with $120m in term loans.
Jurkovich said the scheme was successful in that it helped customers adjust to a post-lockdown environment.
"Following this latest outbreak, we have moved quickly again to ensure we have support packages and other measures in place. With the situation changing day-to-day we'll continue to monitor and respond as necessary."
During the year the bank also achieved B Corp certification - a global standard that assesses social and environmental performance, transparency, and accountability.f year
Reserve Bank says leaving banks to their own devices hasn't worked.