THL reports massive slump in full year profit

By NZPA

Wednesday 28th August 2002

Tourism operator Tourism Holdings Ltd today posted a net after tax profit of $300,000 for the year to June 30.

The result was hit by a tax-paid writedown of $2 million on unusual items and was a massive slump on the $13 million profit recorded a year earlier.

Tourism Holdings will pay a dividend of three cents per share on October 31.

THL chairman Keith Smith said cash initiatives and asset disposals improved operating cash flow to $53 million for the year to June 30, from $45 million last year.

The company also repaid debt of $15 million.

A significant drop in tourist arrivals over the peak summer season from THL's key markets, Germany and Japan, immediately following the events of September 11, coupled with Ansett Australia's collapse, contributed to a 9 percent fall in sales revenue to $181.7 million.

"Despite tough trading conditions in the motor home rentals sector, THL maintains its pre-eminent position within Australia and New Zealand," Mr Smith said in a statement.

"The company is well placed to benefit from tourism growth on both sides of the Tasman and this is reflected in a number of initiatives on the agenda in the 2002/03 financial year, including a $6 million investment in a new boat for Milford Sound Red Boat Cruises to enter service in October 2003.

"While the impact of force majeure incidents such as the events of September 11 are not something we can foresee, the outlook for THL is positive as economic conditions improve. Australia's tourism recovery has been much slower than in New Zealand, however as with New Zealand there are positive signs in forward bookings for motor home rentals in Australia as the peak summer season approaches."

In the year to June 30 THL divested its 50 percent stake in Milford Sound Flightseeing and this month The Helicopter Line. Negotiations with interested parties were under way over the sales of Mt Cook Ski Planes and Treble Cone Ski Area, Mr Smith said.

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