Super Retail Group (ASX:SUL) has declared a fully franked final ordinary Dividend of 33 cents per share for FY26, taking Ordinary Dividends for the year to 65 cents per share. The owner of Supercheap Auto, rebel, BCF and Macpac has a dividend reinvestment plan (DRP), but the board suspended it effective from FY26 until further notice, so the dividend is paid in cash.

Latest developments

Super Retail reported its FY26 results in August. Group sales rose 3.2% to a record $4.2 billion, with like-for-like sales up 1.8%, and gross Margin edged up 10 basis points to 45.7%. Normalised profit before tax fell 7% to $306 million, and statutory net profit after tax fell 7.2% to $206 million.

Chief executive Paul Bradshaw said the result came despite geopolitical instability in the Middle East, unfavourable weather and increasing Interest Rate pressure on households. The company said its deliberate investment in strategic projects, including a new automated distribution centre in Victoria and a new human resources and Payroll system, resulted in the decline in profit before tax.

By brand, rebel delivered a solid sales result and Supercheap Auto was resilient, while trading was softer for BCF and Macpac. Mild winter conditions late in the year weighed on Demand for cold-weather outdoor products, and the company said a fuel crisis around Easter disrupted trading in outdoor and leisure categories.

Key numbers

The board declared a fully franked final ordinary dividend of 33 cents per share. With the 32 cent interim, FY26 ordinary dividends total 65 cents, which the company says is at the upper end of its dividend payout policy. Both dividends are fully franked at the 30% company tax rate, and the value of franking credits depends on each investor's tax position.

About the company

Super Retail Group is an Australian retailer that operates four brands: Supercheap Auto in automotive parts and accessories, rebel in sporting goods, BCF in boating, camping and fishing, and Macpac in outdoor apparel and equipment. It also has operations in New Zealand.

Its loyalty programs are a key part of the model, with active club members growing to 13.1 million in FY26. The company launched a new five-year strategy towards the end of FY26, setting out growth plans and a transformation agenda.

How the DRP works

Super Retail Group has a DRP, but its board resolved to suspend the plan effective from FY26 until further notice, with the plan last operating for the FY25 final and special dividends. Consistent with this, the company's FY26 dividend notice states that it does not have a securities plan for dividends on its ordinary shares. Shareholders receive the 33 cent final dividend in cash.

When the DRP last operated, shares were priced at the volume-weighted average price over a set pricing period with no discount applied, and participation was not available to holders with registered addresses outside Australia and New Zealand. Any reinstatement of the DRP would be a matter for the board and would be announced by the company.

Why it matters for income investors

With the DRP suspended, FY26 dividends are paid entirely in cash, and no shares are issued under the plan in respect of these dividends.

The company's payout sits at the upper end of its policy range, so dividends are closely linked to earnings. Changes in profit may flow through to future payouts, which remain subject to board decisions.

What comes next

Super Retail said FY27 had started positively, with like-for-like sales up 1.5% and total sales up 3.5% in the first seven weeks, led by Supercheap Auto. It expects Capital Expenditure of about $160 million in FY27, funding its store development program and transformation investments, and plans further new store openings.

The company noted that Middle East tensions, rising interest rates, Inflation and housing market pressure continue to weigh on consumer confidence. The next dividend decision is expected with the half-year result.

Risks and context

Profit fell in FY26, and because dividends are set with reference to earnings, a further decline could mean lower payouts. Discretionary retailers are exposed to consumer spending, weather, interest rates and fuel costs, and the company's investment program adds cost before its intended benefits are realised.

Dividends are assessable income, and the tax treatment of franking credits depends on individual circumstances.

Conclusion

Super Retail Group (ASX:SUL) declared 65 cents of fully franked ordinary dividends for FY26, including a 33 cent final dividend. Its DRP is suspended from FY26 until further notice, so dividends are paid in cash. Record sales and a positive start to FY27 sit alongside lower profit and consumer headwinds identified by the company.

Key Insights

Super Retail Group (ASX:SUL) lifted FY26 sales to a record $4.2 billion while normalised profit before tax fell 7%, which the company attributed to deliberate investment in strategic projects. Ordinary dividends of 65 cents per share, fully franked, sit at the upper end of its payout policy.

The company's DRP remains suspended from FY26 until further notice, meaning dividends are paid in cash. Future dividends depend on Earnings and board decisions, with the company noting ongoing pressure on consumer confidence.