Turners Auctions announces half year net profit

News Release
20 August 2010

Turners Auctions announces half year net profit
10% ahead of the same period last year

Turners Auctions today announced a half year net profit before tax of $2.16m, and a 6% increase in net profit after tax to $1.46m.

“We are pleased with these results given the challenging environment we’re operating in and how hard the industry was hit in 2009,” says Chief Executive of Turners Auctions, Graham Roberts.

“Total revenue is up 4% and the primary drivers for that are higher unit sales from Turners Fleet, strong growth in interest revenue due to a higher Turners Finance ledger, and increased insurance commissions from sales of motor vehicle breakdown insurance policies.”

“The outlook is unpredictable, however there are positive signs for key revenue lines within our company, our market share for cars is on the rise and the Trucks and Heavy Machinery business is undergoing substantial growth.”

Other revenue lines to note include the commercial business which continues to benefit from an economy under pressure with many receiverships and liquidation sales. Add-on sales including finance and insurance policies have also made a strong contribution to the business.

The NZ used vehicle market is up 5% year to date compared to 2009. However the market has moved into a situation of over-supply with used Japanese imports brought into the country up 82% to 44,109 units. As a result consumers are seeing the benefit of this with reductions in the price of vehicles.

The Turners Finance ledger has grown to $17.6m as at the end of June up $3.7m or 27% since June 2009. This growth has come from a combination of strong loan sales and a reduction in the proportion of loans settled early.

The strong cashflow generated from operating activities and positive result in the first half, mean the Directors have declared a fully imputed net dividend of 5.0 cents per share, payable on the 21st September.

ENDS

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