Tourism Holdings notes potential speedbump in earnings forecast

Tourism Holdings says vehicle sales could take longer than expected. Photo / Supplied

Tourism Holdings predicts it will still report a net profit of at least $48 million in the June year but sees a risk arising if vehicle sales take longer than expected.

The biggest rental campervan operator in Australasia is hosting an investors’ day today to showcase its operations in Auckland and Hamilton.

It also affirmed its earnings guidance as the travel and tourism sectors continue to bounce back from the pandemic slump, with one caveat – there’s a risk that delays to vehicle sales in the June quarter could slip into July or August.

“We consider this a potential timing issue reflecting the financial year in which the sales margin is realised,” the company said in presentation slides published on the New Zealand stock exchange.

Tourism Holdings said forward bookings for the 2023 high season in the northern hemisphere show increased international volumes and some slowing of domestic activity. Similarly, the NZ and Australian high-season bookings indicate more international growth accompanied by some domestic reduction.

“We remain positive heading into FY24/25 with expectations that international travel volumes from most markets return to pre-covid levels in late CY24 [calendar year 2024], while the recovery of inbound from China will take longer,” the company said.

“We expect that deteriorating macroeconomic conditions may influence travel trends in favour of lower-cost destinations over the short to medium term.”

The Tourism Holdings investor day comes as the Tourism Industry Aotearoa kicks off the TRENZ conference in Christchurch, where more than 300 businesses are showing off their wares to more than 330 international buyers from 25 markets.

Tourism Holdings said rental vehicle yields are either growing or retaining recent growth in all markets, although demand for vehicle sales has come off its peak.

The company acknowledged ongoing supply issues and labour shortages, which it said will increase costs.

The shares have bounced back from the covid lows, closing at $4.25 on Monday and up 166 per cent over the past three years.