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Turners Autos lifts profit 13 per cent

NZ Newswire logoNZ Newswire 28/05/2017 Tina Morrison

Turners Automotive Group has lifted annual profit 13 per cent after it acquired Buy Right Cars, expanding its vehicle retail unit.

Profit increased to $17.6 million in the year ended March 31, from $15.6m the previous year, the Auckland-based company said on Monday.

Pre-tax earnings increased to $24.6m, up from $21.6m a year earlier. Revenue rose 48 per cent to $252.4m while expenses lifted 53 per cent to $227.8m.

The company's automotive retail unit, which accounts for two thirds of earnings, boosted operating profit 54 per cent to $15.4m as revenue lifted 64 per cent to $193m.

Its Turners retail business is generating better margins and providing more finance opportunities by selling more vehicles to retail customers rather than dealers, and the automotive unit is also benefiting from the acquisition of Buy Right Cars in July 2016.

"Both businesses are performing strongly with Buy Right Cars performing above expectation, and starting to originate a strong flow of consumer loans into the finance division," the company said in a statement.

The company's second-largest division, its finance arm which arranges vehicle loans to customers, lifted operating profit 4 per cent to $10.2m.

Turners said its debt collection service was growing its market share in Australia and New Zealand, with new corporate and small-to-medium business clients won during the year. Operating profit lifted 3.5 per cent to $6.2m.

The company's insurance unit bucked the improving trend, with operating profit declining by a third to $928,000, even though revenue increased 49 per cent to $13.7m.

Its shares last traded at $3.86, having gained 30 per cent the past year.

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