Tourism Holdings Limited · NZX:THL
Tourism — Investor Presentation (April 2016)
26 slides from Tourism's investor presentation, Apr 29, 2016
Slide 1: thl Investors Melbourne Site Visit 29 April 2016
thl Investors Melbourne Site Visit 29 April 2016
Slide 2: Disclaimer
Disclaimer This document contains summary information about Tourism Holdings Limited (thl) as at 29 April 2016. The information is subject to change without notice and does not purport to be complete or comprehensive. It should be read in conjunction with thl’s other periodic and continuous disclosu
Slide 3: thl operates in a sector with strong growth prospects
thl operates in a sector with strong growth prospects Travel and Tourism Annual visitor Last 12 Months Estimated size of Country spend growth arrivals, FY15F – market Growth FY15F – FY20F FY20F New Zealand NZ$9.0 billion 5.2% CAGR ↑ 3.9% CAGR ↑ 10% Arrivals Australia AU$42.8 billion 3.4% CAGR ↑ 4.4%
Slide 4: Vehicle sales market dynamics are also positive
Vehicle sales market dynamics are also positive Baby boomer segment is the dominant buyer group. Demand Growing segment with discretionary spend and time. Drivers Bach/holiday home alternative. NZ Motor Caravan Association 57,000 members - growing at ~ 10% pa. AU motorhome registrations 20
Slide 5: Our Vision
Our Vision TO SUSTAINABLY CONNECT MILLIONS WITH PERSONALISED EXPERIENCES LEVERAGING OUR EXPERIENCE IN RV'S GLOBALLY 3
Slide 6: thl is your access point to the tourism industry; globally
thl is your access point to the tourism industry; globally New Zealand United States United Kingdom • SEATTLE TODDINGTON Australia 4
Slide 7: Where our profits come from – FY15 statistics
Where our profits come from – FY15 statistics Revenue EBIT before Group Support Services Costs Tourism Group 13% Tourism Group 22% Rentals NZ Rentals NZ 35% 38% Rentals USA 21% Rentals USA 26% Rentals Aus 17% Rentals Aus 28% Return on Funds Employed 40% 35% 30% 25% 20% 15% 10% 5% 0% thl Rentals NZ R
Slide 8: Our business model today – tourism products and services
Our business model today – tourism products and services RV and tourism RV products RV and tourism physical products services (owned) (flexible ownership) (low / no capital) Build / Rent / Sell Build / Buy/ Rent / Sell Experience Seeker • Global scale • Mighway sharing focused services • Design-led
Slide 9: The “core fleet” business model – build / buy - rent – sell
The “core fleet” business model – build / buy - rent – sell New Zealand Australia United States • 100% purchased in USA. • Buy 50% from Action • Buy from Action Manufacturing • Example retail sale price new Build / Buy Manufacturing JV and 50% JV US$59,000- US$69,000 (excl. Build well designed vehic
Slide 10: “Pod” Concept
Reduce capital intensity, increase flexibility Just Go Fleet to “Pod” Concept New Zealand • Minivan conversion product • Sharing economy • One season in the UK • Pods last up to five • Platform launched late years 2015 • One season in NZ • Vans all gone within 12 • Separated start up • Sold months o
Slide 11: Traditional Flex Fleet: Long term debt versus working capital
Long term debt versus working capital We have positioned the business model today to look at debt and working capital in a different way. The accounting methodologies haven’t changed and fleet are still considered fixed assets. We are now positioning flex-fleet as, in essence, working capital as the
Slide 12: Revenue and EBIT growth outlook
Revenue and EBIT growth outlook Organic Growth FY14 & FY15 growth in rentals EBIT in Rentals NZ and AU has been mainly driven by fleet rationalisation. FY16 Rentals NZ and AU rental fleet has been essentially flat on FY15, with higher flex fleet offsetting lower core fleet. Growth has been drive
Slide 13: Lions tour NZ 2017
Lions tour NZ 2017 Late June and July 2017. Expected Lions tour visitor numbers of circa 20,000 to New Zealand. Different to the Rugby World Cup in 2011 in that there are less provincial games (less touring). We will not increase fleet for this period and believe we can fulfill demand with o
Slide 14: NZ Rentals outlook
NZ Rentals outlook FY16 has seen the introduction of flex fleet, offsetting reduction in core fleet. FY17 market demand indicators are positive. Growth in substitute yields (hotels, motels) supports FY17 yield growth. Flex fleet will be lifted as demand is proven. Overall margins expected
Slide 15: AU Rentals outlook
AU Rentals outlook FY16 included introduction of 4WD flex fleet and reduction in 4WD core fleet. FY17 market demand indicators to date are positive. Flex fleet will be introduced for summer as demand is proven. Overall margins expected to improve. Rentals AU FY16 FY17 Market dynamic Positive
Slide 16: USA Rentals outlook
USA Rentals outlook FY16 included increase in fleet of circa 10% for summer 2015. Fleet for summer 2016 increased by circa 10%. Demand for summer 2016 is positive. Bookings from new Seattle branch are strong. Need to increase investment in resourcing and infrastructure in FY17 to support cur
Slide 17: Tourism group
Tourism group Waitomo Waitomo Homestead Increased visitors above international arrivals, i.e. growing share. Strong growth from Asian markets. Homestead working well to provide much needed capacity for F&B. Kiwi Experience Kiwi Experience Glamping Continuing to grow. Positive outlook to FY
Slide 18: Mighway
Mighway Mighway launched in November 2015. Based on the sharing economy, Mighway focuses on providing customers with a vehicle that is owned within the private market. We are focused on ensuring we achieve appropriate returns for the owners, the managed partners and ourselves, whilst deliverin
Slide 19: Joint ventures
Joint ventures Just Go We remain focused on working with our JV partner to increase the size of this business from both a rental and sales perspective. There are circa 35% of customers that travel to Europe from the Just Go business which provides future opportunities. We will grow the number
Slide 20: Total customer experience
Total customer experience Combining the GeoZone business with some internal crew, we are isolating some new initiatives from the core business to explore a new model for services to our customers. The costs of these initiatives are within our current forecasts for the business. The business wi
Slide 21: Capital spend - flexibility
Capital spend - flexibility Flex fleet in FY16 takes the form of: USA fleet, turned over in 9-18 months. NZ flex fleet – trialled in NZ for FY16 summer period, turned over in under 9 months. AU flex fleet – 4WD vehicles purchased under a buy-back arrangement for the 2016 winter season, turned
Slide 22: Dividend
Dividend 50% imputation, due to approximately 50% of profits before tax being derived from NZ. Dividend policy is payout ratio of 75%-90% of NPAT. We are confident we can maintain a dividend payout ratio at the higher end of the policy ~ 90% given the current capital expenditure profile. Divid
Slide 23: Outlook
Outlook FY15 FY16 FY18 Actual Forecast Forecast (previously FY19) NPAT $20M $24M $30M Based on the current controllable initiatives, demand profile and fleet outlook we have moved the previous high level guidance goal of $30M NPAT to FY18 (from FY19). This is pre any growth acquisitions and allows f
Slide 24: Summary
Summary thl provides exposure to the positive international travel trend. Positive outlook for key ‘experience seeker’ customers: Renters / tourism visitors. Buyers of vehicles. Geographical spread – NZ, Australia, USA, UK. There has been a shift to more flexible fleet capital management
Slide 25: Bios – New Leaders
Bios – New Leaders JO ALLISON - COO PAUL SHALE – GM TCEx DAVE SIMMONS – COO NEW BUSINESS DEVELOPMENT • Jo holds a Bachelor of Arts, double major • Paul has over 20 years marketing, start-up and digital • Dave has spent 20 years working in the travel & (Economics/Psychology) and Post Graduate Diploma
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Tourism Holdings — Investor Presentation (April 2016) on 6ix