Turners Automotive Group Limited

Okay, we've clicked over 10.30, so we'll get on with things. So welcome everyone this morning. Thanks for taking the time to join the call today. Looks like we've got a good solid group of people online, so thank you very much. Usual team presenting, so Aaron Saunders with me, the group CFO, and myself, Todd Hunter, the group CEO. So we'll go through The results, then we'll open up for Q&A at the end, so people can just use the raise hand function. Great to see James and Kieran have already got their hands up, so I look forward to that. Or alternatively, you can just use the chat, and we can see the questions come up. So either is good for us. And we'll just open the audio as well. So I think you can probably just do it yourself. We'll sort that out when we get to the end. So let's sort of kick off with things. I think we're really pleased with the six months just completed. Another record result for the business, highlighting yet again the consistent earnings trajectory for the group. Turner's has continued to grow earnings despite what's felt like a very, very challenging macro environment for us to operate in. particularly the change from the beginning of the calendar year into that April, May, June period. We've seen vehicle margins growing, finance has been an absolute standout result, and insurance has delivered really good growth as well. And we've also taken a number of steps, which Aaron will go into, to improve our capital effectiveness. In short, I think this is another great result for Turner's. Yeah, the used car market itself has recovered somewhat over the last year, but really the big change has been the reduction in used imports coming into the country, and that's sort of driven the fastest ageing of the fleet than we've ever seen before. And largely that's just simply down to the government regulation that's been in place with the Clean Car Standard. So that's put quite a lot of pressure on securing stock locally. It's just sort of forced more dealers into that sort of local sourcing channel. But the expectation is that will reduce with the announcements this week around the relaxation to the clean car standard. That will certainly open up that import channel and make it more viable going forward. We believe there are a number of benefits for tuners with more replacements, more replacement of older vehicles, leading to increased volume for our damage and end-of-life division, more transactions in the market, which just drive opportunity for Oxford and Autoshore. And just going back to that earlier comment, it should reduce competition for local stock as more displaced sort of import dealers go back to Japan. So I think net net, yeah, definitely a benefit for the group. that pressure on securing stock has forced a number of these smaller sort of marginal operators uh to leave the market and i mean it's an interesting graph when you kind of look at that over over that sort of seven or eight year period just how much that has dropped um so 27 but you know you have to go back to 2012 to find dealer numbers as low as they are now Okay, I'll just hand over to Aaron now, who's going to take you through the next 10 or so slides.

Thanks, Todd, and good morning, everyone. Results-wise, we're pleased. We've eked out a good increase in revenues, particularly in the auto businesses, and profit lines, profit for tax and profit after tax, both up 13%. Earnings per share, up 11%, and the directors have declared a fully imputed dividend of $0.08 per share. which will result in a slightly over 10% increase in the full year forecast dividend. In terms of profit growth, it's been well distributed through the auto-focused businesses with a little bit of interest cost savings coming out of corporate. Auto retail profits have lifted due to improvements in owned car margins and a stronger commercial business, so that's our trucks and damaged and end-of-life business. Finance profits have been boosted by solid growth in the loan book and an improving net interest margin. Insurance has seen good growth in the premium base, which will underpin high profits going forward. In terms of the balance sheet, inventory levels have grown since September 24, but they do remain low relative to historical levels, and we would certainly like to grow these further at the moment. Finance receivable growth has come about as a result of strong market share gains across the originated base. Property plant and equipment assets are up, and that's off the back of completion of new owned sites in Christchurch and Napier, and the purchase of a new site in Dunedin. And borrowings are up in line with the increase in finance receivables. And importantly for us, we've deployed no additional capital to support the increased lending in that business. The business continues to be well funded. We've made some really good progress in the last 12 months, just reshaping our facilities. Our corporate capacity is more than sufficient to support our committed branch expansion plans in Aotearoa, which is sites in Auckland, Tauranga, Whanganui and Dunedin. And there's a strong appetite from our lenders to support us further.

Sorry, I'm just going to make sure I've got everyone muted here. I think we have, yeah, good.