Tourism Holdings Limited (ASX:THL) Outlines Growth Roadmap
Growth Roadmap
Tourism Holdings Limited (ASX:THL) has unveiled its growth roadmap, detailing key drivers expected to enhance performance in the coming years. The company anticipates significant growth in rental revenue, substantial debt reduction, and successful implementation of its cost reduction plan.
Strategic Initiatives
The roadmap includes several strategic initiatives, such as a strategic review of the UK & Ireland division, addressing the manufacturing cost gap between New Zealand and Australia, reducing capital in the Australian Retail Sales division, and accelerating the North American synergy project. These actions aim to overcome current challenges and boost long-term value.
Financial Targets
Tourism Holdings Limited aims to achieve $100 million in net profit after tax over the next three to four years. This target is driven by growth in rental hire days, operational efficiencies, and cost optimisation initiatives. The company outlined key assumptions, including a 25% growth in rental days and a significant reduction in net debt.
Rental Revenue Outlook
The company expects rental revenue growth in FY26 and beyond, with forward rental revenue in New Zealand and Australia approximately 25% higher than the previous year. Rental hire days are projected to approach pre-COVID levels, supported by increased awareness of RV travel and government-backed tourism growth strategies.
Executive Comments
Chair Cathy Quinn stated, “The recent work completed as part of thl’s business planning process, combined with the strategic initiatives thl has been progressing, and the detailed assessment of the non-binding offer from the BGH consortium, has led the Board to a view that now is the right time to present thl’s growth roadmap for the coming years. The Board is unanimous in its belief that thl has now passed an inflection point in terms of performance and, over the next few years, expects rental revenue to grow significantly, debt to reduce significantly, and its near-term cost reduction plan to be successfully implemented.”
Motley Fool contributor Aaron Shaw has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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