Key Highlights

  • Sales Revenue fell 3.8% to A$702.0 million, and net profit after tax fell 5.2% to A$92.4 million.
  • The final Dividend was 35 cents fully franked, following a 34 cent interim dividend.
  • All US channels grew, and the store-in-store rollout with two US retail partners reached 8 of 47 stores.
  • Management expects improved Supply of key Toyota models in FY27.

How is ARB Corporation responding to a year in which sales and profit fell?

The central development: a dip with a dividend intact

Sales revenue was A$702.0 million, down 3.8% from A$729.9 million. The company (ASX:ARB) operates in this market. Profit before tax fell 8.9% to A$123.0 million, and net profit after tax fell 5.2% to A$92.4 million. Basic Earnings Per Share were A$1.11, down 5.9%. Underlying Profit before tax of A$118.6 million was down 10.5%.

The final dividend was 35 cents fully franked, after a 34 cent interim dividend. A 50 cent Special Dividend relating to FY25 was paid during FY26, which contributed to net cash falling by A$21.3 million to A$47.9 million.

Why profit fell, and the half-on-half pattern

Management attributed first-half weakness largely to a weak Australian dollar against the Thai baht, since ARB manufactures in Thailand and Australia, and to over-recovery of factory fixed costs in the prior period. Profit before tax fell 18.8% in the first half and rose 1.9% in the second half against the prior corresponding periods.

That recovery pattern matters more than the full-year decline, because it suggests the first-half weakness was partly currency and cost recovery rather than a collapse in demand.

Segment performance

ARB sells through several channels. Australian Aftermarket sales were A$390.1 million, down 3.3% and 55.6% of the total. Key Australian vehicle platforms fell 4%, with dealer and fleet channels hit hardest, in part because of constrained vehicle supply. Exports were A$268.4 million, up 0.5% and 38.2% of sales; US exports grew 10.2% (13.5% in US dollars) despite Tariff and economic headwinds, while the UK was materially affected by lower new vehicle registrations. Original Equipment Manufacturer (OEM) sales fell 27.2% to A$43.4 million, which management called temporary because of gaps between vehicle programs and constrained supply. The company has secured contracts for two future platforms with new US OEMs, which typically have two- to four-year development cycles.

Growth initiatives

US progress is the main bright spot. All US channels grew, a distribution centre migration in Norco, California was completed, an Ascent canopy was launched with an exclusive distribution partnership, and a US engineering centre completed its first fully US-led development. Store-in-store rollout with Off Road Warehouse and 4 Wheel Parts reached 8 of 47 stores, with 22 more due by the end of calendar 2026. ARB China began operations, with an official opening in May, and a direct South African wholesale operation starts in FY27. Engineering Investment is rising 10% to 15% a year, and product launches include accessories for the Toyota FJ and the Ford Ranger Super Duty.

Outlook

Management's FY27 commentary points to improving supply of key Toyota models, including the reintroduced LandCruiser 70 Series and better availability of the HiLux, Prado and 300 Series, plus a positive US outlook, continued South-East Asian growth and new China and South Africa operations. OEM sales are expected to improve subject to platform timing. No numerical guidance was reported, and further detail is expected at the annual general meeting.

Sector and competitive position

ARB's strength is its Brand and accessory range fitted to popular 4x4s, which makes it dependent on the vehicles that its customers buy. Competitors include other aftermarket accessory makers and OEM-fitted accessory programs. Reliance on vehicle manufacturers' supply and on dollar versus Thai baht are structural features of the model.

Risks and developments to monitor

Vehicle supply for key Toyota and Ford models and the timing of OEM program launches.

dollar against the Thai baht and the US dollar.

US tariffs and consumer demand, given growth reliance on the US.

Execution of the China and South Africa expansions.

Returns on higher engineering and store investment.

Whether margins hold at FY25 levels in the first half of FY27.

Detail on strategy at the annual general meeting.