Turners Automotive Group (NZX:TRA) Announces Record Half-Year Financial Results
Turners Automotive Group (NZX:TRA) has announced its strongest half-year performance on record, with net profit after tax (NPAT) reaching NZ$21.9 million for the six months ended 30 September 2025. This 13% growth compared to the prior corresponding period underscores the company’s resilience amid persistent economic headwinds in New Zealand.
This Turners Automotive Group record performance was supported by a 5% increase in revenue to NZ$219.0 million and a 10% rise in EBIT to NZ$34.1 million. These strong financial results were achieved even as the broader sector faced significant pressure, with registered dealer numbers falling to their lowest levels since 2012.
What Drove the Finance Division’s Growth?
The Finance division was the standout contributor to the group’s NPAT, delivering NZ$9.5 million in profit, an 18% increase year-on-year. This growth was driven by a 13% expansion in the loan book to NZ$492.9 million, backed by stable credit quality and favourable funding dynamics.
Gross finance receivables for the period reached NZ$485.9 million, a notable increase from NZ$429.2 million in the prior corresponding period. Furthermore, impairment provisions decreased to NZ$6.2 million, and economic overlay provisions were reduced to NZ$1.4 million, reflecting management’s confidence in credit conditions. Bad debt write-offs remained low at NZ$102,000, highlighting disciplined underwriting standards.
“Our business has performed exceptionally well through the first half. We’ve strengthened every part of our model, from sourcing and lending quality to capital efficiency,” said Todd Hunter, Group Chief Executive Officer.
Auto Retail Maintains Margin Discipline
Despite ongoing structural consolidation in the market, the Auto Retail division generated NZ$16.0 million in profit, up 9%. Revenue increased by 5% to NZ$152.6 million, primarily achieved through improved margins on owned stock rather than an increase in volume.
The division successfully navigated vehicle supply constraints by focusing on disciplined buying practices and efficient inventory management. Simultaneously, brand marketing investment was increased with the launch of the Tina 2.0 campaign, reinforcing Turners’ market-leading position.
How Did Turners Achieve This Record Performance in a Challenging Market?
The Turners Automotive Group record performance can be attributed to several strategic advantages. The company’s diversified business model, encompassing auto retail, finance, and insurance, provided earnings stability while different market segments faced unique pressures.
Key scale advantages included:
- Extensive Network: The largest Auto Retail network in New Zealand provides significant procurement leverage.
- Brand Strength: The Tina 2.0 marketing campaign has reinforced market-leading brand recognition.
- Diversification: The Finance and Insurance divisions reduce dependency on retail market cyclicality.
- Capital Access: The recent securitisation program supports growth without requiring equity dilution.
Ongoing market consolidation has allowed well-capitalised operators like Turners to gain market share from exiting smaller dealers.
What Returns Are Shareholders Receiving?
In light of these strong NZX:TRA profit results, the Board declared a fully imputed Turners Automotive Group interim dividend of 8.0 cents per share. The dividend aligns with the company’s policy of distributing 60-70% of NPAT and will be paid on 29 January 2026.
Basic earnings per share rose 11% to 24.2 cents, and net tangible assets per share increased to NZ$1.75. Management has reaffirmed its full-year NPBT guidance of approximately NZ$60 million, which could support a full-year dividend of at least 32 cents per share.
Chairman Grant Baker commented on the achievement: “Delivering record profit in a challenging economic environment is a significant achievement. It reflects the strength of our diversified model and disciplined execution across every part of the business.”
Capital Management and Strategic Funding
Turners’ capital management strategy was enhanced by the completion of a NZ$200 million securitisation. This transaction reduces funding costs and improves balance sheet flexibility for future growth. The Group maintains a syndicated funding facility of NZ$377 million with Bank of New Zealand, ASB Bank, and Westpac New Zealand.
What is the Outlook for Turners Automotive Group?
Looking ahead to FY26, management expects the two-speed economy to persist, creating some uncertainty around the pace of consumer demand recovery. However, the company’s diversified business model and strategic focus are anticipated to provide continued stability and earnings momentum.
- Auto Retail: Branch expansion and a recovering lease market are expected to lift volumes, while improving vehicle pricing should support margins.
- Finance: The division will focus on growing its loan book while maintaining disciplined credit quality and underwriting standards.
The company’s ability to leverage its scale and brand in a consolidating market positions it well to navigate the economic environment and continue delivering value to shareholders.
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