Turners Shareholder Letter

Dear Shareholder
The Turners Limited Annual Report for the year ended 31 March 2021 is now available. We invite you to
read this on our website at https://www.turnersautogroup.co.nz/Investor+Centre/Investor+Reports.html.
We were pleased to report a record profit and record dividend in FY21, with many of the changes we
have made over the last two to three years now starting to provide strong traction.
Margin expansion and market share gains are helping deliver the bottom line growth that we knew
was possible, and the mix of diversified earnings is delivering the consistent growth plus yield that
shareholders are looking for. We were pleased to deliver record dividends of 20 cents per share in FY21.
Looking Forward
Our growth plan has developed over the last 24 months and we are confident our actions will deliver
continuing growth over the next three years.
Four key areas will underpin our earnings growth. These will be a combination of both physical and
digital investments and initiatives are already underway.
1. Retail Optimisation across people, property and processes.
2. Vehicle purchasing decision-making using data and tools to help identify new sourcing
opportunities and ensure our vehicle buyers are maximising opportunities
3. Growing premium lending within Finance
4. Continued investment in digital and improving our omni-
channel customer experience which allows customers to
engage with us however, whenever and wherever they want.
Our focus is on organic growth which will be funded out of
retained earnings and we are continually assessing ways to make
our business more capital efficient.
We have full confidence that our growth plans will support our
continued positive momentum in FY22. Shareholders should
expect to see a further improved result and, accordingly, a
corresponding increase in FY22 dividends.
We look forward to delivering another year of value to our
people, our customers and our shareholders.
Grant Baker Todd Hunter
Chairman Group Chief Executive Officer
Within three
years we are targeting
profit before tax of $45
million. This would
equate to a dividend
payout of 24cps.
TURNERS LIMITED
Consolidated statement of financial position for the year ended 31 March 2016
2016
2015
Notes
$’000
$’000
Assets
Cash and cash equivalents10
13,810
12,339
Financial assets at fair value through profit or loss11
18,455
17,350
Trade receivables12
9,575
7,394
Inventory13
14,156
8,984
Finance receivables14
167,598
142,827
Other receivables and deferred expenses15
8,505
5,946
Reverse annuity mortgages16
9,734
13,253
Property, plant and equipment19
11,108
8,319
Tax receivables
-
433
Deferred tax asset20
4,024
8,532
Intangible assets21
105,338
103,595
Total assets362,303
328,972
Liabilities
Other payables22
22,270
17,790
Deferred revenue23
6,049
7,476
Tax payables
990
71
Derivative financial instruments
49
-
Borrowings24
174,816
156,995
Life investment contract liabilities32
15,629
16,378
Insurance contract liabilities32
12,688
9,260
Total liabilities232,491
207,970
Shareholders’ equity
Share capital25
136,127
135,294
Other reserves
(52)
(23)
Retained earnings
(6,263)
(14,269)
Total shareholders’ equity129,812
121,002
Total shareholders’ equity and liabilities362,303
328,972
For and on behalf of the Board

G.K. BakerP.A. Byrnes
Chairman DirectorExecutive Director
Authorised for issue on 22 June 2016
The accompanying notes from part of these financial statements

FY21 AT A GLANCE
FY21 FINANCIAL SNAPSHOT
■
Record earnings despite
a COVID-disrupted year
effectively reducing
trading to a 10-month
period
■
Revenue down 11% to
$296.5m
■
Net Profit Before Tax up
29% to $37.4m
■
Underlying Net Profit
Before Tax up 19% to
$34.3m
1
■
Net Profit After Tax up
28% to $26.9m
■
Record FY21 dividend of
20.0 cps (equating to a
gross yield of 8.1% per
annum based on a share
price of $3.42 as at 31
March 2021)
■
Earnings per share up 29%
to 31.4cps
■
The used car market proved resilient, rebounding strongly
following COVID-lockdown, for the `high trust’ Turners
brand
■
Acceleration of digital strategy and rigorous cost
management saw strong profit lift in three of four divisions
■
Market share growth and margin expansion helping to
deliver record profit
■
Robust annuity earnings from Finance and Insurance
sectors validates the diversified business model
■
Auto Retail
Used vehicle market demonstrated resilience throughout
the year. Margin expansion driven by buying initiatives,
strong consumer demand and restrained supply
■
Finance
Continuing to grow share of premium tier, high quality
borrowers, with arrears at record lows
■
Insurance
A number of key competitive wins, risk pricing adjustment
and cost initiatives supporting operating profit growth of
50%
■
Credit Management
Decrease in revenue and profit due to market-wide
conservatism with respect to debt collection during first
phase of the pandemic, with debt load and collections
work recently reinitiated
■
Turners is in a position of strength to deliver
further on its growth plans
Turners delivered
record earnings in
FY21, despite a
COVID-disrupted
year.
1
Underlying Net Profit Before Tax is a non-GAAP measure
and excludes one-off or non-cash costs including
property sales and acquisitions, COVID-related support
and remuneration sacrifice, review and restructure costs
and profit normalisation (Turners’ estimated profit had
the business not been shut during lockdown). In FY21,
these totalled $3.1 million. A reconciliation can be viewed
on page 18 of the FY21 Annual Report.