Turners Auction profits up 200 per cent

Tighter control of inventory and smart buying in Japan pushed vehicle auction company Turners Auctions profits up more than 200 per cent in the year to December 31.

Turners reported a net profit after tax of $3.3 million for the 2009 financial year - an increase of 207 per cent on the same period last year despite flat auction revenues .

Chief executive Graham Roberts said despite the continued decline in the New Zealand used vehicle market during the year, the company's commitment to growing market share and managing costs delivered an excellent result for its shareholders.

"Pleasingly, auction revenues have fared well at $36.6 million, delivering a small increase on 2008 revenue of $36.5 million. This is due to continued growth in sales of repossessed vehicles, government fleet vehicles and lease and rental company vehicles," said Roberts.

Operating profits from Turners Fleet improved significantly compared to the previous financial year while Turners Finance profits also increased due to higher interest margins, a growing loan book and improved sales of add-on insurance products such as mechanical warranties.

"As indicated at the half year, changes in our strategy have delivered significant savings in business costs, with total expenses for the year down 14 per cent to $65.8 million."

For Turners Fleet the cost of sales was down a quarter to $24.7 million. The company-wide shift to an online marketing strategy had reduced advertising costs by half to $1.4 million and delivered an additional 9 per cent of registered bidders, when compared to 2008.

Continued investment in online initiatives yielded a 31 per cent increase in web traffic in 2009 and contributed to the growth of online purchasing.

Directors declared a final dividend of 7c per share which brings total dividend payments for 2009 to 12c a share.

- NZPA