Turners Projects Over 10% Profit Rise in HY26, Loan Book Up 5%
Turners Automotive Group is on track to surpass its record first-half earnings by over 10%, driven by strategic branch expansions and robust finance and insurance growth despite economic headwinds.
- HY26 net profit before tax expected to exceed HY25 by more than 10%
- Automotive retail boosted by owned vehicle sales and Christchurch branch expansion
- Loan book grows 5% since March 2025 with disciplined credit management
- Insurance portfolio underwritten by Vero shows strong growth
- Company confident in achieving $65M NPBT target by FY28 ahead of schedule
Strong Earnings Outlook Despite Economic Headwinds
Turners Automotive Group has provided an optimistic update on its financial outlook for the first half of fiscal year 2026 (HY26), projecting net profit before tax (NPBT) to exceed the previous record set in HY25 by over 10%. This positive forecast comes despite a challenging economic environment marked by low consumer confidence, restrictive interest rates, and rising unemployment in New Zealand.
Automotive Retail Division Gains Momentum
The company’s automotive retail segment is performing ahead of last year’s results, with a strategic shift from consignment to higher sales of owned vehicles helping to offset supply constraints. While the Christchurch branch expansion caused some initial disruptions in the first quarter, these sites are now gaining traction. Turners has also launched the "Tina from Turners 2.0" marketing campaign, supported by an increased media investment of $600,000, which is expected to bolster vehicle margins and sales volumes in the second half of FY26.
Finance and Insurance Businesses Drive Growth
Turners’ finance division has seen a 5% growth in its loan book since March 2025, reflecting strong demand and disciplined credit management. The company anticipates continued solid growth supported by a favourable interest rate environment. Meanwhile, the insurance business, particularly the motor vehicle insurance portfolio underwritten by Vero, continues to perform well with stable claims ratios and expanding distribution channels, including new direct sales initiatives.
Credit Management Positioned for New Challenges
Amid a struggling New Zealand economy, Turners has noted an increase in consumer arrears and debt referrals. However, the onboarding of a significant new corporate customer in April positions the credit management division to support businesses navigating the evolving credit cycle. This diversification may help mitigate risks associated with rising arrears.
Confident Path to Mid-Term Targets
Despite the patchy macroeconomic backdrop, Turners remains confident in its growth trajectory and is on track to achieve its mid-term NPBT target of $65 million by FY28 ahead of schedule. The company’s ongoing branch expansion plans and marketing initiatives are expected to further strengthen its market position and financial performance in the coming years.
Bottom Line?
Turners’ strategic expansions and disciplined growth approach set the stage for sustained earnings momentum amid economic uncertainty.
Questions in the middle?
- How will Turners manage credit risk if consumer arrears continue to rise?
- What impact will the Christchurch branch expansions have on overall profitability in FY26?
- How effective will the new marketing campaign be in driving long-term vehicle sales growth?
