Tourism Holdings shares fell 24 per cent when trading opened after the company lowered its full-year earnings guidance by as much as 22 per cent and said a decisive operation and capital review of its US operations is now underway.
The company, which rents and sells campervans, expects net profit of $25 million to $28 million for the year ending June 30. When reporting first-half earnings in February, Tourism Holdings signalled annual profit would be around $32 million, already lower than its previous guidance of $32 million to $34 million.
The stock fell to $3.85, the lowest since June 2017. It recently traded at $4.05 as bargain hunters moved in after the initial tumble, said Grant Williamson, a director at Hamilton Hindin Greene. He noted it was the second downgrade in a "relatively short period of time," and as a result investors had "treated it harshly."
"I think investors are concerned," he said, noting the company has recently expanded aggressively which creates some risk.
Tourism Holdings said the main reason for the downgrade was the ongoing deterioration in US vehicle sales.
