Tuesday, February 24, 2004
MEDIA RELEASE
Tourism Holdings Trading Profit
Supports Special Dividend Payment
Tourism Holdings Limited (THL) today reported an unaudited Net Profit After Tax (NPAT) of $4.2m for the six months ended
31 December 2003. This compares to $5.2m for the same period last year. But after excluding the NPAT of $1.4m recorded
last year on the sale of businesses, unusual items and trading from discontinued businesses the Net Profit After Tax is
10.5% up on the previous year on a like for like basis.
FORECAST
Based on current trends and there being no significant adverse world events, the Directors forecast a NPAT of $10m for
the full year which compares with a reported NPAT of $8.7m the previous year.
The second six months trading NPAT of $5.8m is anticipated to be 93% ahead of last year’s $3m NPAT.
SPECIAL DIVIDEND
With the improved profit, favourable trading outlook and solid cash flows, the Directors have resolved to pay a special
one-off dividend of 4 cents per share in addition to the interim dividend of 4 cents per share. The combined dividend of
8 cents per share will be fully imputed and will be paid on the 23rd April 2004 to shareholders on record at 16 April
2004.
TRADING ENVIRONMENT
Keith Smith, Chairman, stated that the international tourism market is now more stable than experienced over the past
three years. The uncertainties created by September 11, Iraq War and the Sars virus have abated. Whilst world events
will always impact international travel, the current outlook for the South Pacific in which THL operates and New Zealand
in particular is more positive.
During the period under review the New Zealand tourism market was slow to start, following the Iraq War and Sars virus.
Compounding this was the poor start to the South Island ski season and a slower than expected recovery from Japan and
Asia to these world events. However the summer high season for New Zealand during November/December has gone extremely
well.
Australia had a disappointing six months with low volumes continuing. The overhang of Iraq/Sars and a weak German
economy impacted our Australian businesses. Australia is starting to turn around with forward bookings above last year,
however the businesses are operating in soft markets.
Fiji, where THL has a relatively small but strategic investment, is enjoying a major recovery through increased air
capacity driving competitive pricing of packages to Fiji.
SMALL SHAREHOLDERS PLAN
Directors have provided a cost effective plan for small shareholders to either increase their shareholdings to 1,000
shares or alternatively dispose of their holding. There are a number of shareholders (19%) who hold less than 1,000
shares, representing in total 1% of the share capital. The administrative costs to THL of maintaining small shareholders
is high. By THL meeting the brokerage costs this will enable shareholders to preferably acquire, or alternatively
dispose of shares in an economic manner.
FINANCIAL POSITION
Mr Smith said that THL has continued to focus on maintaining a strong Balance Sheet. Whilst interest bearing debt
increased over the year by 13% to $64m this reflected an increased motorhome fleet build for the high season, reduced
fleet disposals and the expenditure on acquisitions of Black Water Rafting and Ruakuri Caves concession. The Debt to
Debt Plus Equity Ratio is very healthy at 31% (last year 30%) whilst the Equity Ratio is 59% compared to 58% last
December.
OUTLOOK
Mr Smith indicated that the immediate outlook for THL’s markets is more certain and favourable than previous years.
Whilst THL is still trading through the New Zealand high summer season (November to Easter) there has been no world
event adversely influencing tourism. New Zealand is experiencing its best summer season in the past four years and our
New Zealand operations are benefitting accordingly.
Australia appears to be recovering after four disappointing years, impacted more severely than New Zealand by world
events.
The relatively high NZ/AU exchange rates have as yet had no apparent direct impact on tourism flows. The major
appreciation has been against the US dollar and not the Euro, UK or Japanese currencies.
THL businesses in New Zealand, Australia and Fiji are well positioned to capitalise on South Pacific regions growth in
tourism, particularly in the Independent Traveller market.
ENDS