Tourismholdings Foreign Exempt NZX FY26 Results Show Profit Return, Dividend Up 62%

thl returns to profit and lifts dividend 62% in FY26 turnaround

In its FY26 annual results presentation dated 25 August 2026, Tourism Holdings Limited (thl) reported statutory net profit after tax (NPAT) from continuing operations of $39.9M, a return to profit from a $14.1M loss in FY25.

Underlying NPAT from continuing operations rose 34% to $46.1M, while sale of services revenue, primarily rentals, increased 11% to $517.5M. The Board lifted the full-year dividend 62% to 10.5 cents per share (cps).

Investors also have two live, non-binding indicative takeover proposals before the Board as important context. Management acknowledged an honest headwind: the Middle East conflict disrupted H2 booking momentum, tempering the earnings step-up thl had expected for FY27.

Results at a glance: FY26 headline numbers

The turnaround reflected fleet growth, improved RevPARV and disciplined strategic execution across the group. The following figures are presented on a continuing operations basis versus the prior corresponding period (PCP), in NZD.

The balance sheet strengthened alongside earnings. Key measures included:

• Net operating cashflow up 67% to $67.3M

• Net debt reduced to $436M (FY25: $492M)

• Leverage improved to 2.32x (FY25: 2.99x)

Strategic execution: the FY25 restructure delivered

Management outlined how the strategic initiatives announced in August 2025 were executed during FY26. The completed actions comprised:

1. Sold the thl UK & Ireland business for approximately $57M, including around $8M of goodwill, now reported as discontinued operations under NZ IFRS 5.

2. Closed two loss-making Australian dealerships, Sydney RV and Kratzmann, and rationalised the product range.

3. Closed the Brisbane manufacturing factory in December 2025, consolidating production into Hamilton, New Zealand.

4. Implemented fleet and procurement synergies in North America.

5. Delivered approximately $5M in cost savings across labour, corporate and digital costs.

The presentation noted that not all benefits are evident in FY26, with some requiring fleet rotation over time. The Brisbane factory sublease, targeting calendar 2026, is expected to provide a further NZ$2.5M per annum cost saving once finalised. Fleet and build-cost synergies in North America and Australia are expected to progressively increase as lower-cost vehicles rotate through the rental fleet.

Divisional highlights

Divisional returns varied widely by capital intensity and market conditions. Key points included:

• Tourism delivered the group’s highest Return on Funds Employed (ROFE) at 182%, reflecting its low capital intensity, while Action Manufacturing recorded 30.8%.

• New Zealand Rentals & Sales EBIT rose 9% to $52.7M; Australia underlying EBIT increased 32%.

• North America ROFE was just 0.5%, improving off a negative base and aided by a $60M reduction in average funds employed.

Group ROFE improved to 8.7% (FY25: 7.6%), against a through-the-cycle target of 15%.

The takeover situation investors are watching

Management confirmed that two non-binding indicative proposals are currently before the Board. These comprise a revised $3.10 per share proposal from the BGH consortium and a competing proposal at $3.30 to $3.40 per share from a party the Board considers a credible strategic acquirer.

The current proposals represent a substantial increase from the initial $2.30 per share approach received in June 2025. Due diligence is in process with both parties, and the Board currently expects the due diligence phase to continue for approximately a further six weeks.

The competing NZ$3.30-$3.40 proposal came from a party the Board described as a credible strategic buyer, and due diligence access was granted to that party ahead of the BGH Consortium, introducing price tension into a process that had initially centred on a single bidder.

Both proposals remain non-binding and subject to a range of conditions, including completion of due diligence and internal approvals. The Board stated there can be no certainty that either proposal will result in a transaction, and shareholders are not required to take any action at this time.

Understanding thl’s rental-led model

A rental-led recreational vehicle (RV) business earns recurring income from hiring out vehicles, then sells them once retired from the fleet. This model can prove more resilient than a pure sales operation because rental income continues even when new vehicle sales soften.

Several terms help explain the model:

• RevPARV measures rental revenue per average rental vehicle, a gauge of yield and utilisation.

• ROFE (Return on Funds Employed) is thl’s primary divisional performance metric, with a through-the-cycle target of 15%.

• Ex-fleet sales refers to selling vehicles retired from the rental fleet.

For investors, the flexibility matters. thl can adjust fleet purchases, rotation and holding periods to manage soft RV sales while still earning rental income. In a weak sales market, extending fleet holding periods allows thl to supply lower-cost ex-rental vehicles to cost-conscious buyers.

Outlook: booking recovery underway, but FY27 step-up tempered

Management presented a balanced outlook. The Middle East conflict in March 2026 disrupted H2 booking intake, creating a gap the company described as unlikely to be fully recoverable. Together with continued weakness in RV sales, this has impacted the significant earnings step-up thl had expected for FY27.

Middle East conflict disruption to H2 booking intake was the primary factor behind thl’s May 2026 guidance cut, which revised underlying NPAT down to $40 million-$43 million and lifted projected net debt materially above the $400 million prior guidance ceiling.

Recovery signals were also evident:

• Southern Hemisphere forward bookings have recovered to above PCP, with intake over the last four weeks up approximately 25%.

• New Zealand last-four-weeks intake up approximately 40%; Australia up approximately 15%.

• Canada is on track for record 2026 summer rental revenue.

• The US remains soft, though recent booking intake is tracking approximately 45% above PCP.

thl framed the RV sales weakness as cyclical rather than structural, citing affordability pressures from higher interest rates, fuel prices and inflation. Long-term travel fundamentals were described as attractive, supported by younger and more diverse RV owners and growing participation in outdoor travel.

The $100M ambition — timing shifts, thesis intact

thl stated that the fundamental drivers underpinning its $100M underlying NPAT goal remain intact. These include rental fleet and revenue growth, manufacturing and procurement benefits, other cost initiatives, and an expected cyclical recovery in RV sales markets.

While the timing may have changed, thl believes the long-term opportunity has not.

What it means for investors

The FY26 result marks a genuine turnaround: a return to profit, 34% underlying NPAT growth, a 62% dividend lift and a stronger balance sheet.

Dividend details included:

• Final dividend of 7.5 cps, 100% imputed and 10% franked

• Full-year payout ratio of approximately 50% of underlying NPAT

• Cash yield of approximately 3.6% at the $2.90 closing share price on 30 June 2026

• Ex-dividend date 17 September 2026, record date 18 September 2026, payment date 2 October 2026

thl’s outlook statement

“While the timing may have changed, thl believes that the long-term opportunity has not.”

The near-term catalyst investors will be watching remains the two live, non-binding indicative takeover proposals and the outcome of the due diligence process now underway.

Don’t Miss the Next Industrial Sector Turnaround

Big News Blast delivers FREE breaking ASX news straight to your inbox within minutes of release, complete with in-depth analysis already done for you. Join 20,000+ investors who stay ahead of market-moving announcements the moment they drop. Click the “Free Alerts” button at Big News Blast to get started today.