Campervan company Tourism Holdings says its loss won't be as bad as expected

Thursday, 22 April 2021

Campervan company Tourism Holdings says its loss this year won’t be as bad as analysts expect.

Tourism Holdings, whose campervan business has been hurt by Covid-19 travel restrictions, is feeling more upbeat about its outlook and said its full-year loss won’t be as bad as analysts expect.

The company, which rents and sells campervans in New Zealand, Australia and the United States, expects to post a net loss after tax of between $14 million and $18m in the year to the end of June. That’s smaller than the $21.5m average loss expected by five analysts. Its shares rose 1.9 per cent to $2.75.

Tourism Holdings has described the past year as the biggest single challenge it has faced in its history after Covid-19 wiped out the international travel market that underpinned its business. Still, in a statement to the NZX on Thursday the company said it had “an improved outlook”.

Its US business, which was the star performer in the first half of its financial year, remains strong, the company said.

Tourism Minister Stuart Nash talks about New Zealand tourism in Queenstown. (First published March 2021)

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In the US, the company achieved record average sales margins for its campervans in recent months, although it said some of the margin growth may be one-off in nature, reflecting current market conditions. It’s also positive about the rental market, and expects domestic demand for the upcoming summer season will be similar or better to last season.

In New Zealand, average sales margins for campervans have recovered to more normal levels after a sale campaign in late 2020, and some margins are even higher, it said. Volumes continue in line with the first half.

Tourism Holdings expects its New Zealand rental business to continue to lose money in a domestic-only environment but said web searches have picked up with the re-opening of Trans-Tasman travel and it expects more holiday bookings.

In Australia, vehicle sales and margins are in line with expectations. State borders have mostly remained open, which has boosted domestic rental demand and yields have recovered to pre-Covid levels, the company said.

That’s consistent with expectations that the Australian rental business could be profitable in a domestic environment with no travel restrictions, the company said.

Tourism Holdings confirmed that its net debt will rise from $22m in the first half as it re-invests in new fleet to replace the vehicles it’s selling, but said full-year net debt won’t exceed $90m.