TRA – Shareholders’ Newsletter Mar 18

Dear Shareholder
W
e are now into the last quarter of our financial
year which ends on 31 March 2018. The group
continues to track well with vehicle sales picking
up again since the quiet patch we saw during the election.
We have been seeing strong attach rates for finance
within Turners and Buy Right Cars. This is when a customer
buys a car and also takes up our finance (or insurance)
offers. Insurance premiums are also performing well.
A major focus for us this financial year has been the
consolidation of our finance brands into a single entity,
under the Oxford Finance brand. The rebranding is now
complete and we are working on moving the finance
businesses onto a single technology platform. We are doing
the same with our insurance businesses, which will operate
under the Autosure brand.
To help fund the growth of our finance book we have
been diversifying our funding and now utilise bank
funding, bonds and equity. We are looking to extend the
securitisation we put in place last year to $250 million and
are close to finalising a new banking syndication.
The stink bug has been high on the news agenda – luckily,
Turners has had minimal impact from the cargo ships
being turned away from Auckland’s ports. You can read more
about this on the next page.
We were pleased to renew our commercial agreement
with Suncorp, for a five year term, to manage the logistics
and sale of damaged vehicles that have been written off
by Suncorp’s general insurance brands (Vero, AA Insurance
and AMP). We have had a long standing partnership with
Suncorp – they underwrite the insurance for a number of
our brands, and in fact, we bought the Autosure insurance
business off them in late 2016 which gave us the scale we
needed in the sector.
There is a lot of work going into our property initiatives
including refits and new property developments. When
looking at new sites, for both our Cars and our Trucks &
Machinery businesses, we consider a number of factors that
determine whether we acquire the site, lease it or buy and
then sell with a lease back arrangement. This allows us to
secure strategic locations and develop the site to suit our
needs.
Last year, we identified a new opportunity to provide
service, repairs and maintenance for vehicle owners.
We are working through options for this and are getting
close to being able to announce a partnership with a
large group of repairers. This will increase our relevance to
customers and improve our value proposition.
Aaron Saunders, Turners CFO, and I have also been busy
talking to investors and shareholders, both in New
Zealand and Australia. You can view all our results and
investor presentations on our website.
The business continues to pay quarterly dividends in line
with our dividend policy of 50% to 55% of underlying
earnings. Based on recent share price performance, this
makes Turners Automotive Group a very good yield stock
and extremely good value based on our earnings track record
and recent analysts’ valuations of well over $3.70 per share.
I hope you find this newsletter of interest and welcome
your feedback.
Todd Hunter
Chief Executive Officer
Turners Automotive Group
March 2018
We are pleased to present the first of our Shareholder Newsletters. We believe it is important to keep our
shareholders informed and updated on our company. Therefore, in addition to our annual and interim
shareholder reports, we will also be sending out two Shareholder Newsletters each year. These will contain
news of interest from each of our businesses, introduce you to some of the people in our teams and provide
an overview of the market and our performance.
CEO
UPDATE

TURNERS AUTOMOTIVE GROUP SHAREHOLDER NEWS
32
MINIMAL IMPACT
FROM STINK BUG
The brown marmorated stink bug has been found on
a number of ships heading into New Zealand. This
could have a devastating effect on local agriculture
and horticulture and, in recent weeks, the Ministry
of Primary Industries has turned away several ships
carrying car imports.
This has had minimal impact on Turners as our
diversified supply chain means we can still meet
customer demand. While we had a small number of
vehicles on the affected ships, the majority of our
supply is in the New Zealand market, from Kiwis
buying and selling second hand vehicles; and we
have also landed imported vehicles off other ships.
In fact, conversely, we are benefitting in the short
term as our wholesale auction channel provides an
alternative supply option for dealers; and customers
are also turning to larger retailers, such as Turners
and Buy Right Cars, as their first point of call as they
trust them to have a large supply of stock available.
Getting an effective solution on the supplier side has
to be a critical part of the solution. Pleasingly, many
of our Japanese suppliers have already started taking
preventative actions to ensure stock is fumigated and
bug free before being loaded onto ships.
CONTAINERS AS OFFICES
One of the interesting things we are doing is looking
at innovative solutions for building offices on some
of our retail sites.
Containers are a smart looking, cost effective and
practical solution.
They can easily be built offsite, installed and then if
needed, simply moved to alternative sites. They create
a modern look and can be stacked to produce a highly
visible billboard. The concept pictured has been
developed for our Buckle St site in Wellington and
should be in place some time in May.
AUTOMOTIVE RETAIL
Turners has signed a five-year agreement with Suncorp
New Zealand to manage the logistics and sale of
damaged vehicles that have been written off by Suncorp’s
general insurance brands. Over 156,000 vehicles were
either written off or removed from the road in New
Zealand in the past year, and the number of vehicles from
1995 to 1999 now being scrapped is accelerating.
Almost 30% of New Zealand’s 3.7 million light vehicle fleet
is 20 years old or more, and older cars are now being
replaced at a rapid rate. The growing ‘End of Life’ market is a
significant opportunity for Turners to sell older or
damaged cars at the end of their life, and to also sell the
newer used vehicles that are replacing them.
Suncorp New Zealand has a large percentage of the End of
Life (EOL) market, through vehicles written off by Vero, AMP,
ANZ and AA Insurance, a joint venture between Vero and
the New Zealand Automobile Association.
Turners has had a long-standing partnership with
Suncorp, which underwrites a number of Turner’s branded
private motor vehicle insurance products through its
intermediated general insurance provider, Vero.
Selling written-off vehicles through efficient partnership
enables Turners to better control costs and also ensures the
re-use of parts which are safely reusable, and the recycling
of as many components of the damaged car as possible.
Damaged vehicles are sold at specialised Turners auctions
every week and through TradeMe. Many are sold to
Automotive Recyclers or are exported overseas for scrap
metal.
Turners has over 20 damaged vehicle consultants spread
throughout the country and three dedicated damaged
vehicle branches in Auckland, Wellington and Christchurch.
Vehicles can either be sold from where they are located,
anywhere in the country, or transported to one of 25
storage networks around the country including Turners’
own sites.
In addition to commercial arrangements, such as that with
Suncorp, Turners also sells EO and damaged vehicles on
behalf of private customers and is now extending its Cash
Now offer to these customers.
CEO of the Automotive Retail Division Greg Hedgepeth
commented “We are extremely pleased to continue our
relationship with Suncorp and feel confident that this
arrangement will give us the ability to further optimise our
business with them. The EOL and damaged vehicle division
is a growing opportunity for Turners, and we are seeing
good growth both here along with the rest of our business.”
TURNER’S GROWING NATIONAL
FOOTPRINT
Having a strong presence in keys areas is a strategic
advantage for our businesses. We now have a
nationwide network of 11 Turners Cars and eight Buy
Right Cars automotive retail sites, plus five stand alone
Trucks & Machinery yards.
Recently, we have opened a new Buy Right Cars site
in Lambie Drive, Manukau to replace our Papatoetoe
branch; and a new Buy Right Cars site in Penrose,
Auckland.
In the Turners Cars business, we have taken on a new
retail site on Buckle St in Wellington; almost finished
development of a new processing facility in Porirua;
are busy refitting and extending our Napier branch;
and have purchased a replacement site for our branch
in Whangarei.
Trucks & Machinery also remains a focus and in the last
year we have acquired three new sites for our Trucks
& Machinery business – the site in Wiri in Auckland
replaces an existing property, and we have developed
new sites in Hamilton and Palmerston North. These are
all now up and running.
OPPORTUNITY IN END OF LIFE VEHICLES FOR TURNERS
“We’re very pleased to continue to strengthen
our partnership with Turners with this long-term
deal to manage written off vehicles.”
Jimmy Higgins
Executive General Manager
of Claims at Suncorp
New Zealand

TURNERS AUTOMOTIVE GROUP SHAREHOLDER NEWS
54
NEW PARTNERSHIP POTENTIAL GAME
CHANGER FOR EC CREDIT CONTROL
EC Credit Control (ECCC)
is our debt management
business, operating across
Australia and New Zealand.
ECCC has established a
partnership with software as a service company
IODM, an Australian-based online automated
accounts receivable solution provider. ECCC will
sell IODM products and act as their debt collection
partner. IODM’s AIMS product (Automated Invoice
Management System) allows businesses to send
out invoices and reminders by SMS, email or letter;
and integrates with all cloud based accounting
packages. At the end of the reminder period, a file
of outstanding debts can be sent automatically to
ECCC for the collections cycle to begin. Find out
more about AIMS at www.eccreditcontrol.co.nz.
This should see more and fresher debts for ECCC,
and ECCC will also receive a share of the monthly
subscription revenue generated from the sale of the
AIMS product.
IODM has also been working with corporate clients
in Australia to have ECCC as their collection agency,
which should lead to an increase in the corporate
client base in 2018.
No other collection agency has a similar combined
product or offer in the marketplace and the
partnership with IODM has great potential.
DIALLING UP THE NUMBERS
Smart dialling software is creating significant value
for ECCC, with up to three times the number of calls
being made on a daily basis.
Previously, staff would have to dial a number, wait for
it to connect, then wait for the other party to answer
(or more likely, go to voice mail). Over the course of a
day, this all adds up.
Now the Dialler technology does all the calling in
the background and only hands the call to the staff
member when there is a live person on the line. In
one of its first months, and with only nine agents, a
whopping 42,000 calls were made, resulting in 8,000
connects and 1,200 promises to pay. This is three
times the number that would have been achieved
prior to the Dialler.
ONE BRAND,
ONE BUSINESS
As Turners has
grown, we have
acquired a number
of different brands and businesses.
We are now well down the track of combining
them into a single finance brand – Oxford Finance –
and a single insurance brand, Autosure.
The new Oxford branding has been unveiled and staff are
excited about the opportunities to grow this business,
building on the success of the MTF non-recourse product
last year and other initiatives.
There is a lot of work going into consolidating our systems,
and this work should be completed by the middle of
the year. Autosure staff are now working from the same
space after moving into new offices on the North Shore in
Auckland; while Oxford Finance continues to operate from
offices in Auckland’s CBD, Levin and Christchurch.
FINANCE BOOK FUNDING
Turners primarily funds its finance borrowings through an
asset backed securitisation warehouse facilitated through
the BNZ. This is a funding facility where a group of
homogenous loans (in this case, vehicle loans) are pooled
together creating a financial security, a process called
securitisation. The benefit it gives Turners is a much more
efficient use of capital, better interest rates and higher
limits for lending.
Currently Turners has a $160m limit on the securitisation
warehouse, which we are currently in a process to extend to
$250m.
As part of our funding strategy we are also in the process of
moving to a syndication of banks to support the business.
We should have both the securitisation warehouse limit
extension and the banking syndication finalised early in the
new financial year.
Payment Protection
Insurance
Guaranteed Asset

Protection

Insurance
FINANCE AND INSURANCEDEBT MANAGEMENT
FY17 Borrowings by Source
MTF 18%
Bonds 8%
Securitisation
38%
Bank 36%
FY17 BORROWINGS BY SOURCE
INTRODUCING
GREG HEDGEPETH
Greg Hedgepeth joined Turners Automotive
Group as CEO of the Automotive Retail Division
in August 2017.
He’s an experienced automotive executive and
previously held senior roles with BMW Group NZ
and Armstrong Motor Group, one of NZ’s largest
private owned retail automotive networks.
Greg’s vision for the Automotive Retail group
revolves around three key principles - People,
Retail Sites and Brand. Along with the Turners
senior leadership team, he has developed a
five year strategic roadmap for the business.
As part of this, plans are being developed to
further capitalise on the synergies within the
wider Turners Group, to better leverage the
scale and expertise in the most effective way
possible, delivering a ‘one stop shop’ solution for
customers.
An indepth nationwide research project has also
been implemented to better understand how
Kiwis buy used cars and their views on the brands
operating in the market.
Greg believes every Kiwi should have the
opportunity to drive around this great country of
ours, and be able to confidently rely on Turners
to buy a great value vehicle. So he is overseeing
the expansion of Turners’ retail network to ensure
“there’s a Turners near where our customers live”.
Outside of work, Greg is a self-confessed petrol
head who is also a sports fanatic, whether its
watching or participating. He’s always up for
trying new things, and thoroughly enjoys having
a good laugh with friends, family, and colleagues.
MEET
THE TEAM
AUTOSURE ROLLS OUT NEW INSURANCE PRODUCTS
One of the things we pride ourselves on at Turners, is the ability to be
agile, flexible and innovative. In recent months, Autosure has launched
three new/upgraded products:
• Payment Protection Insurance (PPI)
• Guaranteed Asset Protection (GAP)
• Electric Vehicle Mechanical and Breakdown Policy
Electric vehicles are starting to grow in popularity (approximately 7,000
registered EVs in New Zealand), and it is important all our businesses are
adapting and reacting to the changing dynamics of the market.
Details on each of these products are available at www.autosure.co.nz.

TURNERS AUTOMOTIVE GROUP SHAREHOLDER NEWS
76
GO BABY GO
A recent finance company fundraiser, themed around the
Lions Rugby Tour, saw $3,500 raised for Go Baby Go.
This is an initiative started by a paediatric professor in the
USA to create freedom and autonomy for children who
have mobility issues but are too young to use an electric
wheelchair. Now they can keep up with their peers and
older siblings behind the wheel of a battery powered toy
car.
The fundraiser allows for two more cars to be added to the
fleet and issued to children in need.
Find out more at www.gobabygo.org.nz.
PROVIDING CHRISTMAS CHEER IN AUCKLAND
Tamaki Primary School in Auckland is a decile one school
and Christmas can be a hard time for many families. For
the fourth year in a row, Oxford Finance National Sales and
Marketing Manager, Shannon Beech, organised staff from
within Turners Automotive Group to donate presents for
the students, providing ‘a little bit of Christmas magic’ for
each child.
Scooters, skateboards, Nerf guns and shoes were top of
the wish list for many younger children and Santa certainly
didn’t disappoint. Older kids didn’t miss out either, with a
huge number of sports balls donated to the day.
To top it off, the team from Flava Radio added an extra bit
of joy and tunes to the day.
TURNERS IS INVOLVED IN COMMUNITIES ACROSS NEW ZEALAND AND SUPPORTS
A NUMBER OF DIFFERENT CHARITIES AND INITIATIVES.
INDUSTRY TRENDS & INSIGHTSSUPPORTING OUR COMMUNITIES
As the largest used vehicle retailer
in New Zealand, Turners has recently
undertaken a large scale research
project to better understand market
dynamics, buyer behaviour and brand
perception.

DELIVERING A TRUSTED CUSTOMER
EXPERIENCE
The results show that a vehicle purchase, whether
its new or second hand, is a big decision for
consumers, with many feeling overwhelmed and
anxious throughout the decision making process,
which can take up to six weeks. Turners is well
positioned to leverage its heritage and strong
brand trust to provide a preferred retail experience.
NUMBER ONE FOR BRAND AWARENESS
Turners has the highest brand awareness of all
used vehicle retail brands in New Zealand, at 90%
awareness compared to 22% for the average used
car dealer.
MOST TRUSTED
Turners is also the most trusted brand, with 45%
trustworthiness compared to 2% for the average
used car dealer. This is built on more than 50 years’
of providing New Zealanders with great second
hand cars, its presence across the country and its
Kiwi heritage.
KEEP IT AFFORDABLE
Cars valued at $30,000 and over make up only
4% of the used car market, and it is clear that
the biggest market opportunity is in the more
affordable end of the market, an area where Turners
has an established presence and market share.
INDUSTRY TRENDS
The used vehicle market is growing and there were
over 1.1 million transactions in New Zealand in 2017,
one of the highest years on record.
CHANGING CONSUMER BUYING BEHAVIOUR
Consumers are becoming more tech-savvy and
informed due to the abundance of information
online. There is an increased willingness to buy
online with the proviso that sufficient information is
available to truly evaluate the vehicle.
THE ROLE OF THE DEALER IS CHANGING
With the abundance of information online, dealers
now need to be as or more informed than the
consumer. They need to have the ability to offer
the complete package from sales to finance and
insurance and have to devise ways to make quick,
convenient sales.
From left: Dion Jones - Group General Manager, Oxford Finance,
Robyn Pescini - National Operations Manager, Oxford Finance,
Mark Prujean - Go Baby Go.
“The smiles on these
children’s faces are
the true meaning of
Christmas and the
greatest reward.”
Shannon Beech
Oxford Finance

8
Primarily opera,ng in the automo,ve sector and providing strength in three key areas:
AUTOMOTIVE RETAIL

Controlling the buying and selling of
second hand cars, trucks and
machinery to earn a transacAonal
margin and delivering cross-sell
opportuniAes for Finance and
Insurance
Turners is the largest second hand
vehicle retailer in New Zealand
FINANCE AND INSURANCE

Helping customers with simple and
aKracAve finance and insurance
products, and building annuity revenue
streams
Turners has a por<olio of reputable
businesses offering finance and insurance
products to customers across New
Zealand, including personal, motor
vehicle loans and insurance
DEBT MANAGEMENT SERVICES

Helping businesses of any size in New
Zealand and Australia with beKer
management of their credit
challenges
Turners has a growing presence in the
debt management sector in both New
Zealand and Australia through its EC
Credit business
AN INTEGRATED AUTOMOTIVE FINANCIAL SERVICES GROUP
Helping retail and wholesale customers in three key areas:
Primarily opera,ng in the automo,ve sector and providing strength in three key areas:
AUTOMOTIVE RETAIL

Controlling the buying and selling of
second hand cars, trucks and
machinery to earn a transacAonal
margin and delivering cross-sell
opportuniAes for Finance and
Insurance
Turners is the largest second hand
vehicle retailer in New Zealand
FINANCE AND INSURANCE

Helping customers with simple and
aKracAve finance and insurance
products, and building annuity revenue
streams
Turners has a por<olio of reputable
businesses offering finance and insurance
products to customers across New
Zealand, including personal, motor
vehicle loans and insurance
DEBT MANAGEMENT SERVICES

Helping businesses of any size in New
Zealand and Australia with beKer
management of their credit
challenges
Turners has a growing presence in the
debt management sector in both New
Zealand and Australia through its EC
Credit business
Primarily opera,ng in the automo,ve sector and providing strength in three key areas:
AUTOMOTIVE RETAIL

Controlling the buying and selling of
second hand cars, trucks and
machinery to earn a transacAonal
margin and delivering cross-sell
opportuniAes for Finance and
Insurance
Turners is the largest second hand
vehicle retailer in New Zealand
FINANCE AND INSURANCE

Helping customers with simple and
aKracAve finance and insurance
products, and building annuity revenue
streams
Turners has a por<olio of reputable
businesses offering finance and insurance
products to customers across New
Zealand, including personal, motor
vehicle loans and insurance
DEBT MANAGEMENT SERVICES

Helping businesses of any size in New
Zealand and Australia with beKer
management of their credit
challenges
Turners has a growing presence in the
debt management sector in both New
Zealand and Australia through its EC
Credit business
AUTOMOTIVE RETAIL
Controlling the buying and selling
of second hand cars, trucks and
machinery to earn a transactional
margin and delivering cross-sell
opportunities for Finance and
Insurance
Turners is the largest second hand
vehicle retailer in New Zealand
FINANCE AND INSURANCE
Helping customers with simple and
attractive finance and insurance
products, and building annuity
revenue streams
Turners has a portfolio of reputable
businesses offering finance and
insurance products to customers
across New Zealand, including
personal, motor vehicle loans and
insurance
DEBT MANAGEMENT
SERVICES
Helping businesses of any size in
New Zealand and Australia with
better management of their credit
challenges
Turners has a growing presence in
the debt management sector in
both New Zealand and Australia
through its EC Credit business
ABOUT TURNERS AUTOMOTIVE GROUP
SHAREHOLDER COMMUNICATIONS GO ELECTRONIC
We encourage our shareholders to receive communications from us by email.
This may include the annual report, share transaction statements, dividend
payment advice, shareholder meeting notices and other company related
material.
It’s simple to sign up. Email enquiry@computershare.co.nz, provide your CSN/
shareholder number and confirm you want to receive Turners Automotive
Group communications by email.
Alternatively, you can log in to www.investorcentre.com/nz and update your
details. For first time users, you will need your CSN/shareholder number and
FIN to access the Investor Centre and register your account. Going forward,
you will access this service with your own User ID and Password.
While there, you can also update other details including change of address,
banking instructions and IRD number.
STAY UP TO DATE WITH TURNERS eNEWS
You can also register to receive news and updates from
Turners as we release them to the market.
To sign up, scan the QR code here or visit our website to
subscribe.
Turners Automotive Group, Level 15, 34 Shortland St, Auckland 1010
Phone: 0800 100 601
|
info@turnersautogroup.co.nz
www.turnersautogroup.co.nz
KEY DATES
Financial Year End:
31 March 2018
Results Announced:
By end-May 2018
Annual Report:
By end-June 2018
2016 Bond Program expiry:
30 September 2018
Quarterly Dividends paid in:
April, July, October, December
CONTACT US
INVESTORS
www.turnersautogroup.co.nz
RETAIL
www.turners.co.nz
FINANCE
www.oxfordfinance.co.nz
INSURANCE
www.autosure.co.nz
EC CREDIT
www.eccreditcontrol.co.nz