KEY POINTS:
New Zealand's largest tourism operator, Tourism Holdings, has boosted its post-tax profits by 7 per cent in the last year but is predicting a tough time ahead for the industry.
The company, whose assets include Waitomo Caves, yesterday reported a net profit after tax of $14.3 million. Total operating revenue was up 9 per cent to $151 million. The numbers were slightly higher than forecasts made in June when it downgraded them from a range of $16 million to $18 million to $13 million to $14 million.
Tourism Holdings chief executive Trevor Hall said he was happy with the result in what was a tough market.
The company said it was lifted by a strong performance from its Australian motorhome operation but that had been offset by a disappointing result from its New Zealand vehicle building business CI Munro, which recorded an after tax loss of $3.3 million.
During the financial year CI Munro was relocated from Otorohanga to Hamilton but the transition had been more difficult than expected.
The year had also seen considerable change for the group with the sale of Kelly Tarlton's Underwater World, its Milford Sound business, a stake in Johnston's Coachlines and Airbus Express.
Tourism Holdings was also in the process of selling and leasing back its backpacker coach business Kiwi Experience and had entered into a joint venture with InterCity.
The company said its focus was now on its core business of tourism rentals and on building up its Waitomo operations. But at the same time it predicted a tough time ahead for the tourism industry.
"The current global credit crisis and volatility in the price of oil are likely to deliver a challenging 12 to 18 months," it said.
The group predicted intense pricing pressure in the New Zealand market but also expected to see a reduction in the number of tourism operators and fleet sizes in the rental sector. Its forward rental book was already down 9 per cent on the same time last year.
Hall downplayed the figure and described it as manageable. "We are not too concerned. We are not discounting the fact that we can pull that back. Nine per cent is manageable."
The group planned to spend up to $70 million on building up its rental fleet and building a new visitor centre at Waitomo but said it would look at dropping that back to $50 million depending on economic conditions.
Tourism Holdings closed down 1c at $1.41.
TOURISM HOLDINGS
Year to June 30
Operating revenue
2008 - $151m
2007 - $138m
Ebitda
2008 - $58.7m
2007 - $63.2m
Net profit
2008 - $14.3m
2007 - $13.4m
Dividend
2008 - 11cps
2007 - 11cps
