thl Rejects $2.30 Bid, Unveils Bold Plan to Rebound from FY25 Loss
thl reported a tough FY25 with a 45% drop in underlying profit and a statutory loss, but is charting a strategic turnaround while rejecting a $2.30 per share acquisition offer.
- Underlying NPAT down 45% to NZD 28.7 million, statutory loss of NZD 25.8 million
- Record EBIT in New Zealand Rentals & Sales and Tourism divisions
- Board rejects $2.30 per share acquisition offer, values company above $3.00
- Strategic initiatives include UK & Ireland review, Australian manufacturing cost cuts, North American synergies
- FY26 expected as transitional year with no profit guidance, confidence in NPAT growth return
A Challenging Year for thl
thl, a leading player in the recreational vehicle (RV) industry, has disclosed a difficult financial year ending June 2025. The company’s underlying net profit after tax (NPAT) plunged 45% to NZD 28.7 million, while statutory results showed a net loss of NZD 25.8 million. This downturn reflects subdued global demand for RVs amid what thl describes as the most challenging industry conditions in decades.
Despite these headwinds, thl’s New Zealand Rentals & Sales and Tourism divisions delivered record earnings before interest and tax (EBIT) for the second consecutive year, underscoring pockets of strength within the group. Conversely, the Australian Retail Sales division and North American operations faced losses, highlighting uneven performance across regions.
Strategic Review and Operational Adjustments
In response to the tough environment, thl has embarked on several strategic initiatives aimed at improving profitability and capital efficiency. A comprehensive review of the UK & Ireland operations is underway, with the possibility of divestment to free up capital for higher-return markets. Meanwhile, the company is addressing a significant manufacturing cost gap between its New Zealand and Australian facilities, where New Zealand production costs are approximately 20% lower on certain models after shipping expenses.
Australian Retail Sales are undergoing a rationalisation plan focused on reducing overheads, trimming inventory from a peak of NZD 110 million to NZD 72 million, and streamlining product lines. In North America, thl is accelerating its synergy project to unify fleet procurement and sales across the USA and Canada, aiming to enhance operational efficiency and meet its 15% return on funds employed (ROFE) target.
Acquisition Offer Rejected, Confidence in Growth Outlook
In June 2025, thl received a non-binding indicative offer from a consortium led by BGH Capital and the Trouchet family, proposing NZD 2.30 per share. After thorough evaluation, the Board declined the offer, signaling a valuation well above NZD 3.00 per share and remaining open to improved bids. Since then, no further communication has been received from the consortium.
Looking ahead, thl has released a growth roadmap targeting NZD 100 million in annualised NPAT within three to four years. While acknowledging ongoing global economic uncertainties and inflationary pressures, the company is optimistic about returning to positive operating cash flows in FY25 and a growth trajectory in FY26, supported by the recovery in international tourism and recent fleet expansions.
FY26 – A Transitional Year
thl cautions that FY26 will be a transitional period as strategic changes take effect amid continued weakness in RV sales. The company refrained from providing profit guidance at this early stage but expects growth in New Zealand Rentals & Sales, Australian Rentals, Canada, UK/Ireland, and Tourism to be partially offset by declines in the US, Australian Retail, and Manufacturing divisions.
Operational highlights include a 20% increase in forward rental revenue across key markets, outpacing international visitor arrivals, and ongoing cost optimisation programs. thl’s focus remains on executing its strategic initiatives while navigating a complex macroeconomic landscape.
Bottom Line?
thl’s decisive rejection of the acquisition offer and strategic recalibration set the stage for a pivotal FY26, where execution will be critical to restoring profitability.
Questions in the middle?
- Will thl’s strategic review of UK & Ireland lead to a divestment or operational turnaround?
- How quickly can thl close the manufacturing cost gap between New Zealand and Australia?
- What impact will the North American synergy project have on regional profitability and market share?
