Continuous disclosure

The share value of used vehicle seller Turners Auctions took a hit this month falling from about $2.50 to $1.95 a share yesterday.

The fall coincided with news that auction website TradeMe will expand its presence in the car market. TradeMe said the number of listed cars had grown from 5000 two years ago to 32,000.

In response Turners, which sells more than 82,000 cars each year, warned buyers about the risks of buying vehicles unseen.

Turners' share value has more than halved from a high of $4.55 in February, when a steady decline followed a record result for the full year.

In February, Turners said profit after tax for the year ending December was $7 million, up 17 per cent on the previous year, with operating revenue up 5 per cent at $79 million.

Although posting a record result, the company said sales growth had slowed in the second half as prices fell and declining immigration dented demand.

Share value continued to fall until May when it stabilised about $2.60, before climbing to about $3 in July then falling again to about $2.50 until October.

This relative stability came despite half-year results showing a drop in profit and revenue.

In August, Turners said half-year profit after tax to June was $2.97 million, down 17 per cent on the same time last year. Operating revenue was $39.6 million, down 2 per cent on last year, although it had recovered $1.2 million on the six months to December.

The company said it was satisfied with the result in light of difficult market conditions and costs incurred establishing Turners AutoCentre and its Motex Australia software business.

It had also secured control of its North American operations, buying out its joint-venture partners, McKenzie and Ehli.

The company said at the time that auction volumes and fleet profit margins had strengthened and were expected to continue during the second half of 2005.