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Turners predicts after Autosure purchase

NZN 21/11/2016 Sophie Boot

Turners expects a "significant" earnings uplift after buying motor insurer Autosure from Suncorp New Zealand.

Turners, the financial services firm formerly known as Dorchester Pacific, has bought the Autosure brand, mechanical breakdown and payment protection insurance portfolios, for $34 million, it said.

Autosure distributes through about 750 dealer agencies in New Zealand, and Turners expects it to contribute earnings before interest, tax, depreciation and amortisation of about $5.5m in the first full year following transfer, which is subject to regulatory approval from the Reserve Bank.

Turners chair Grant Baker said the firm anticipates group earnings "will lift significantly" for the financial year to the end of March 2018, and said the company is in a strong financial position to keep investing.

In the year to March 2016, Turners lifted pretax earnings 13 per cent to $21.6m, exceeding guidance, as revenue jumped 76 per cent to $172m.

Its shares rose 5.2 per cent to a 20-month high of $3.45.

About 70 per cent of the Autosure acquisition will be funded from Turners' recent bond conversion and share placement capital raising, Mr Baker said.

"Autosure will be run as a stand-alone business and all current management and staff will be retained," Turners chief executive Todd Hunter said.

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