Dividend Policy
The thl Board has adopted the following dividend policy:
The thl Board is committed to a dividend policy that aims for consistency of dividend streams while maintaining financial
flexibility through business cycles. The target payout ratio is 75%-90% of Net Profit After Tax (NPAT) giving due
consideration to:
The medium term working capital and net capital requirements of the business.
Maintenance of key financial ratios consistent with a targeted long-term credit rating of Baa/BBB under the
methodologies used by the internationally recognised credit rating agencies.
Any extraordinary or non-recurring items that affect NPAT.
It is noted that, if a situation occurs which will impact NPAT negatively in the short term, Operating Cashflow will be
used to assess the level of dividend pay-out to retain some level of consistency in dividend streams.
Dividends will be payable as an interim dividend in April and a final dividend in October.
It is the intent to attach imputation credits to dividends to the extent possible, recognising that thl is an international company and imputation credits will be proportional to earnings derived in New Zealand.
Strategic Review of Capital Structure Complete
In April this year thl announced the commencement of a review of the capital structure of the company. thl engaged First NZ Capital to conduct the review.
The process is now complete and the Board would like to announce the following outcomes:
• thl expects to remain a publicly listed company.
• An updated dividend policy has been adopted. The policy targets a payout ratio of 75-90% of annual Net Profit After
Tax (NPAT). Consistency in dividend levels is also a focus of the policy.
• thl believes it has significant balance sheet flexibility. The Board intends to use this flexibility to focus on value
accretive acquisitions, either globally or domestically.
• thl intends to continue to use financial benchmark ratios consistent with a Baa/BBB credit rating used by the recognised
international credit rating agencies as a guide for target debt levels.
• thl is targeting growth in NPAT to at least $30M in the 2019 financial year from the existing businesses. The Board notes
this is before any acquisitions or greenfields development. The internal work completed through this strategic review
provides the basis for this goal.
• The Company is preparing to announce a number of new operational initiatives at both the Annual Results release and
Annual Meeting in November. Whilst still in progress, these initiatives will increase revenue and earnings, selling more
services to rentals customers and vehicle sales in the New Zealand market.
ENDS