thl reduces FY24 NPAT guidance

Tourism Holdings Limited
Tel: +64 9 336 4299
The Beach House
Fax: +64 9 309 9269
Level 1, 83 Beach Road
www.thlonline.com
Auckland City

PO Box 4293, Shortland Street

Auckland 1140, New Zealand




6 May 2024

NZX | ASX | MEDIA RELEASE
TOURISM HOLDINGS LIMITED (thl)

THL REDUCES FY24 NPAT GUIDANCE

thl advises that, following a review of all divisions, it now expects net profit after tax (NPAT) in FY24 to be
between $50M and $53M. This compares to earlier guidance set in February 2024 for NPAT to be around
$75M.

The weakening economy has impacted most regions and business divisions negatively and lowered
expectations into Q4. Vehicle sales have been a major factor globally, with sales volumes and margins now
declining more quickly than expected in most markets. Over 50% of the overall group EBIT decline is
attributable to the Australian Retail Dealership division and in particular, a shortfall in the sales volumes of
high-margin ex-fleet vehicles.

Rental yields have generally met expectations in most markets, however a recent slowdown in forward
booking intakes for the Australasian shoulder season will lead to a poorer rental performance than earlier
forecasts in the remainder of FY24.

An investor presentation is attached to this announcement with further detail.

Outlook for FY25 and FY26

thl has retained the goal for $100M NPAT in FY26. thl has considered the assumptions underlying the goal
and believe the goal remains appropriate based on a positive rental growth outlook and a recovery in the
RV sales market globally. However, expectations for FY25 are now below the FY23 Pro Forma NPAT of
$77.1M.

Other implications

Based on its new forecast, thl is forecasting to be compliant with its covenant assessments for the 30 June
2024 quarter. However, thl will engage with its banking syndicate to seek to amend its covenant package
to better reflect current trading conditions.

Based on a preliminary review, thl also believes it is probable that there will be impairment in relation to
the UK/Ireland business division as part of the upcoming 2024 year-end process.

Conference call and webcast

thl will be hosting a webcast and teleconference call for equity analysts and investors later today at
12:00pm NZ time (10:00am AEST), where management will speak to the attached presentation.

To view the live webcast, please use the following link:

https://edge.media-server.com/mmc/p/js4anmvr

A replay and transcript of the call will be made available on thl’s corporate website following the call.

ENDS

Authorised by:

Cathy Quinn ONZM
Chair, Tourism Holdings Limited

For further information contact:

Media:
Grant Webster
thl Chief Executive Officer
Direct Dial: +64 9 336 4255
Mobile: +64 21 449 210

Investors and Analysts:
Amir Ansari
Manager – Strategy & Development; Company Secretary
Direct Dial: +64 9 336 4203
Mobile: +64 21 163 8053

About thl (www.thlonline.com)

thl is a global tourism operator listed on the NZX and ASX (code: THL) and is the largest commercial RV rental operator in the world.
In New Zealand/Australia, thl operates rental brands (Maui, Britz, Apollo, Mighty, Hippie, Cheapa Campa), manufacturing (Action
Manufacturing, Apollo), retail brands (Talvor, Kea, Winnebago, Adria, Coromal, Windsor), retail dealerships (RV Super Centre,
Apollo RV Sales, Kratzmann, George Day, Sydney RV, Camperagent, E-Camperco), travel technology (TripTech) and tourism
attractions (Kiwi Experience and the Discover Waitomo Group, which includes Waitomo Glowworm Caves, Ruakuri Cave, Aranui
Cave and The Legendary Black Water Rafting Co.). In North America, thl operates the Road Bear RV, El Monte RV, CanaDream,
Britz and Mighty rental brands. In UK and Europe, thl operates the Just go, Apollo and Bunk Campers rental brands.

---

FY24 GUIDANCE UPDATE
6 MAY 2024

thl FY23 INVESTOR PRESENTATION
2
This presentation contains forward-looking statements and
projections. These reflect thl’s current expectations, based
on what it thinks are reasonable assumptions. The
statements are based on information available to thl at the
date of this presentation and are not guarantees or
predictions of future performance. For any number of
reasons, the future could be different and the assumptions
on which the forward-looking statements and projections
are based could be wrong. thl gives no warranty or
representation as to its future financial performance or any
future matter. Except as required by law or NZX or ASX
listing rules, thl is not obliged to update this presentation
after its release, even if things change materially.
This presentation has been prepared for publication in New
Zealand and may not be released or distributed in the
United States.
This presentation is for information purposes only and does
not constitute financial advice. It is not an offer of securities,
or a proposal or invitation to make any such offer, in the
United States or any other jurisdiction, and may not be
relied upon in connection with any purchase of thl
securities. thl securities have not been, and will not be,
registered under the US Securities Act of 1933 and may not
be offered or sold in the United States, except in
transactions exempt from, or not subject to, the
registration of the US Securities Act and applicable US
State securities laws. Past performance information given
in this presentation is given for illustrative purposes only
and should not be relied upon as an indication of future
performance.
This presentation may contain a number of non-GAAP
financial measures. Because they are not defined by
Generally Accepted Accounting Practice in New Zealand
(NZ GAAP) or International Financial Reporting Standards
(IFRS), thl’s calculation of these measures may differ from
similarly titled measures presented by other companies
and they should not be considered in isolation from, or
construed as an alternative to, other financial measures
determined in accordance with NZ GAAP.
This presentation does not take into account any specific
investors objectives and does not constitute financial or
investment advice. Investors are encouraged to make an
independent assessment of thl. The information contained
in this presentation should be read in conjunction with
thl’s latest financial statements, which are available at:
www.thlonline.com.
Disclaimer

3
Summary
•Following a review of all divisions, thl now expects NPAT in FY24 to be between $50M and $53M.
This compares to earlier guidance set in February 2024 for NPAT to be around $75M
•The weakening economy has impacted most regions and business divisions negatively. Vehicle
sales have been a major factor globally, with sales volumes and margins now declining more
quickly than expected in most markets. Over 50% of the overall group EBIT decline is attributable to
the Australian Retail Dealership division and in particular, a shortfall in the sales volumes of high-
margin ex-fleet vehicles
•Rental yields have generally met expectations in most markets, however a recent slowdown in
forward booking intakes for the Australasian shoulder season will lead to a poorer rental
performance than earlier forecasts in the remainder of FY24
•thl is forecasting to be compliant with its covenant assessments for the 30 June 2024 quarter,
however it will engage with its banking syndicate to seek to amend its covenant package to better
reflect current trading conditions
•thl believes it is probable there will be impairment in relation to the UK/Ireland business division as
part of the upcoming year-end process
•Based on a positive rental growth outlook and a recovery in the retail sales market to normal
conditions, thl has retained the goal of $100M NPAT in FY26, however expectations for FY25 are now
below the FY23 Pro Forma NPAT of $77.1M

4
The changes to our EBIT expectations by division
There are significant declines across most divisions, but weighted towards vehicle sales
A significant proportion of the
decline within Retail Australia
and Rentals & Sales New
Zealand is attributable to the
slower ex-fleet vehicle sales
~$145M
1
$0.5M$0.3M
($17.9M)
($5.8M)
($4.6M)
($4.3M)
~$113M
FY24 EBIT Expectation
1
~$145M EBIT is equivalent to earlier guidance for NPAT of around $75M

5
-25
-20
-15
-10
-5
0
5
Jan-24Feb-24Mar-24Apr - Jun 24
Variance to NPAT Forecast ($M)
Market conditions have deteriorated more rapidly than
anticipated, particularly in Q4 FY24
Variance in actual NPAT in Q3 FY24, and updated expectations for Q4 FY24,
compared to earlier forecast
Actual Performance
Based on
Updated Forecast
~$1.0M
~$(3.5M)
~$(2.0M)
~$(19.0M)
(in aggregate)
•While year-to-date trading to February 2024
was down by circa ~$2.5M, there were several
opportunities targeted to make up the
shortfall over the remainder of FY24
•As actual results for March 2024 were
finalised in late April, this showed a further
decline in performance on expectation.
Combined with a slowdown in rental
booking intakes, it was decided to revisit all
assumptions underlying the forecast for Q4
FY24
•This review process identified significant
unforeseen changes in expectations from
most business divisions, to the amount of an
~$19M decline in NPAT in Q4 compared to
earlier forecasts
•thl entered a trading halt while the review
process was finalised

6
However future rental periods are not
expected to be as significantly impacted
The intake of rental hire days into the upcoming 2024/2025 high season is
tracking significantly ahead of the prior year. The current intake reflects a single
digit percentage decline in average yield which is in line with our allowances
The intake of rental hire days for FY25 are tracking in line with the prior year.
The current intake reflects a small single digit percentage decline in average
yield which is in line with our allowances
The intake of rental hire days for the 2025 high season shows strong growth on
the prior year. The greater mix of international to domestic bookings has had a
negative impact on average yields
The intake of rental hire days for the 2025 high season shows growth on the
prior year. Average yields are currently single digit percentage down due to a
greater number of bookings on early bird discount rates
The intake of rental hire days for the 2025 high season shows growth on the
prior year, with average yields holding flat

Outlook

8
•Given the recent trading performance in April and the deterioration in outlook for the
remainder of Q4, we currently expect net profit after tax in FY24 to be between $50M
and $53M
•We consider the current impact to be reflective of current economic conditions which
should improve over time. We do not see any signs of a structural change for demand
for RVs
•The Manufacturing and Tourism businesses are tracking in line with our earlier
expectations
•We have retained our goal for $100M NPAT in FY26. We have considered the
assumptions underlying our goal and believe the goal remains appropriate based on a
positive rental growth outlook and a recovery in the RV sales market globally
•However, our expectations for FY25 are now below the FY23 Pro Forma NPAT of $77.1M,
and below the current analyst consensus of ~$87M
•We intend to slow fleet purchases across the next 12 months and expect our rental fleet
to be below 9,000 at the end of FY25 (previous guidance below ~9,500)
Outlook for FY24, FY25 and FY26

9
Our assumptions for FY26
•We have reviewed all our high-level assumptions for FY25 and FY26, considering the recent
trading performance and economic environment
•We continue to expect the transition of group profitability from vehicle sales profits towards
greater rental earnings over the coming years
•When considering the FY26 $100M NPAT goal, the following key assumptions have been applied:
•Rental yields: Fall from FY24 to FY25 in all markets and stabilise or have small growth in FY26
•Hire days: Growth in days reaches or exceeds pre-COVID-19 levels in FY26 for Australia, UK and
Canada. Hire days in the USA and New Zealand remain below pre-COVID levels in FY26
•Utilisation: All markets being broadly aligned with historical utilisation levels or better where
synergies have been identified
•Vehicle sales volumes: Ex-fleet sales volumes broadly aligned with pre-COVID-19 quantities in all
markets
•Vehicle sales margins:Above pre-COVID-19 levels for Canada and the USA (accounting for North
American synergies). Margins in line with pre COVID-19 for Australia and New Zealand
•Synergies: Full realisation of originally scoped synergies relating to the Apollo merger which
remains on track
•General costs: Increasing in line with general market movements (and above our previous
expectations)
•Australian retail dealerships: We have allowed for continued softness in this division and do not
expect it to achieve the returns that were delivered through the COVID-19 period
•General tourism: We are confident in ongoing tourism demand growth globally over the coming
years which will underpin a positive tourism economic sentiment

10
Other implications
Financing
•Based on the updated forecast, thl is forecasting to be compliant with its covenant
assessments for the 30 June 2024 quarter. However, it will engage with its banking
syndicate to seek to amend its covenant package to better reflect current trading
conditions
•The outlook for future quarters has greater tolerance than the June 2024 quarter
Asset impairments
•With the recent deterioration in outlook, thl has considered parts of the group that
may be at risk of potential impairment. Based on this initial work, thl believes that it
is probable that there will be impairment in relation to the UK/Ireland business
division
•An impairment assessment on this asset will be undertaken as part of the upcoming
2024 year-end process
•The value of any potential impairment has not been allowed for in the updated
earnings guidance for FY24

Divisional View

12
The expectation for fewer ex-fleet sales
across ANZ has a material impact on group
performance
H2 FY24
Original
Forecast
Updated Forecast
(Including Q3 Actual)
Shortfall
Gross Profit on
Shortfall
Ex-fleet vehicle sales
in Australia and New
Zealand
~550 unit sales ~235 unit sales ~315 unit sales ~NZ$13.5m
•thl generates a higher group margin on the sale of ex-fleet vehicles which are
manufactured in-house and depreciated while on the rental fleet
•Each division (manufacturing and rental) generates a margin which is not realised until
the vehicle is sold to a third party by the Retail division
•Collectively, the margin on the sale of these vehicles is currently higher than historical at
circa ~A$50k per unit in Australia and ~NZ$30k in New Zealand
•Consequently, the shortfall of ~315 sales in H2 to earlier forecasts results in a negative
gross profit impact of ~NZ$13.5m within H2 FY24
1
•The opportunity to sell these vehicles and realise the embedded equity/margin has not
deteriorated. These vehicles will be sold at a future date
1
The expected EBIT decline on earlier expectations in New Zealand Rentals & Sales (detailed on slide 4) is less than the total gross profit
shortfall from fewer ex-fleet sales in that division, as there was outperformance on expectations by the rentals business in Q3 FY24

13
Vehicle sales in Q4 FY24
Change in expectations compared to earlier forecast
~180 reduction in expected unit sales with ~NZ$7,500 decline in the average
sales margins
On a same-store basis, a circa ~215 fall in expected new and used unit sales.
Overall volume reduction to be mitigated by inclusion of CamperAgent
sales. Small decline in average sales margins
1
Increase in sales volumes to be driven by large wholesale transactions,
however at circa US$5,000 lower margins than earlier expectations
Increase in sales volumes to be driven by large wholesale transactions and
new retail pricing strategy to drive greater retail sales at better mix of
average sales margins
~100 (-70%) reduction in expected unit sales with a small decline in average
sales margins
1
A large proportion of the impact to Australian Retail in H2 FY24 was incurred in the late weeks of
Q3 FY24

14
Rentals in Q4 FY24
Change in expectations compared to earlier forecast
The intake of hire days has growth on the prior year but with smaller growth than
trending in earlier months. Average yields are in line with expectations with a
small decline on the pcp
Hire day intakes are in line with the prior year and lower than earlier expectations
due to recent weakness in domestic business and a late booking pattern. Average
yields are in line with expectations and down ~10% on the pcp
Rental income for the last quarter is down around 10% on expectations with a
slowdown in domestic activity. International hire days are up on expectations
with the greater mix of international bookings dropping average yield
Bookings have tracked in line with expectations. International business has
continued to book late and yields have been maintained in line with the pcp
Uncertain timing on delivery of new vehicles from the manufacturers has
impacted ability to take rental bookings for the early high season. Yields remain in
line with the pcp

Q&A

Thank you