Terror, war, Sars - but tourists are coming back

By SIMON HENDERY

The country's largest tourist business, Tourism Holdings, has managed to exorcise the ghosts of industry disasters past.

After it released an upgraded profit announcement yesterday, the company's share price soared 8c to $1.34, a level rarely seen since September 11, 2001.

The US terror attacks that rocked confidence in international travel almost two years ago were the first of three global events to dampen investor confidence in the tourism sector. Then came the Iraq war and the Sars virus.

But yesterday Tourism Holdings was able to rescind an earlier Sars-related profit downgrade.

It told the market its June year net profit would be about $7.5 million, well up on the $4.5 million to $5.5 million forecast it made in May when Sars was gripping the industry.

Chairman Keith Smith said the main reason for the better performance over the last quarter was better trading revenue from the company's Australian motorhome rental operations and, to a lesser extent, the same operation in New Zealand.

Unaudited management accounts showed the motorhome transtasman division, run under the Maui and Britz brands, contributed $1.1 million after tax to the increased profit.

"The downturn from the Iraq war and Sars was less prolonged than was expected at the time of our May 6 announcement," the company told the Stock Exchange.

It had also been helped by better-than-forecast returns from the sale of vehicles retired from its rental fleet, and a $600,000 Australian tax benefit from 2001.

Managing director Dennis Pickup declined to expand on yesterday's announcement, which he said was made to satisfy the company's continuous disclosure obligations.

He said full details would be made public when the company released its annual result on August 27.

However Pickup said "the worst is over" as far as Sars was concerned and bookings for the upcoming peak summer tourism season "are back to traditional levels [before September 11]".

The company's optimism as summer approaches was yesterday echoed by the Ministry of Tourism and by Tourism New Zealand.

A record number of visitors are expected to arrive this summer.

In its bimonthly newsletter, published yesterday, Tourism New Zealand said it expected increased arrivals from three of the country's four biggest tourist markets over the next three months.

Arrivals from Australia and North America are forecast to rise 5 to 10 per cent in the August to October quarter, compared with a year earlier, and UK arrivals are predicted to rise 5 to 15 per cent.

The other top-four market, Japan, is predicted to be down 10 to 20 per cent this quarter.