How AUB Group (ASX:AUB) Reached Record Earnings as Insurance Markets Moderate

Sonal Goyal

10 November 2026 05:03 PM AEDT

How AUB Group (ASX:AUB) Reached Record Earnings as Insurance Markets Moderate

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Key Highlights

• AUB Group (ASX:AUB) reported full-year results for the year to 30 June 2026 on 25 August 2026.

• Underlying net profit after tax (NPAT) rose 12.2% to $224.6 million, from $200.2 million a year earlier.

• Underlying Earnings Per Share were 183.69 cents, compared with 171.75 cents.

• Revenue was reported at $1,596.6 million, and the group EBIT Margin was 36.1%.

How is AUB Group (ASX:AUB) managing to grow record earnings while insurance pricing cools and interest income falls? The FY26 result suggests the answer lies in diversification: resilience in international and specialty businesses offset softer conditions in New Zealand and strata insurance, and management has guided to further growth in FY27.

The FY26 result

AUB Group (ASX:AUB) reported full-year results for the year to 30 June 2026 on 25 August 2026. Underlying net profit after tax (NPAT) rose 12.2% to $224.6 million, from $200.2 million a year earlier. Underlying earnings per share were 183.69 cents, compared with 171.75 cents. Revenue was reported at $1,596.6 million, and the group EBIT margin was 36.1%. All figures are in Australian dollars unless stated.

Reported NPAT told a different story, falling to $96.0 million from $180.1 million. The company attributed the fall to $62.7 million of impairments and other charges. Underlying NPAT is management's preferred measure, so the reconciliation in the accounts is worth reading.

Chief executive Michael Emmett said FY26 delivered record earnings and higher margins despite moderating insurance markets, and credited the breadth of the group, led by encouraging international progress.

What AUB does

AUB is an insurance broking and Underwriting agency group. Its revenue comes mainly from commissions and fees on premiums placed, plus income on premium funding and cash balances.

That structure matters. When premium growth moderates, the group relies more on client growth, acquisitions and margin improvement.

Segment performance

The segment figures, all underlying net profit before tax, show where growth came from.

• Australian Broking: $149.1 million, up 10.0%, helped by a 6.5% rise in average commission and fee income per client and bolt-on acquisitions, partly offset by lower interest income.

• International, including Tysers: $124.5 million, up 19.6%, with EBIT margin up 410 basis points to 27.6%. Growth came from marine and aviation revenue and newly seeded businesses.

• Agencies: $78.0 million, up 8.4%. EBIT margin was 43.7%, down 50 basis points, or 46.5% excluding strata, which was up 80 basis points.

• New Zealand Broking: NZ$26.1 million, up 2.7%, but down 3.9% to $22.3 million in Australian dollars. EBIT margin fell 130 basis points to 33.1%.

• BizCover: $22.9 million, up 19.9%, with EBIT margin of 47.8%.

International was the largest contributor to growth in percentage terms, and BizCover matched it from a smaller base. New Zealand was the weak spot, with the company citing a challenging corporate market, currency headwinds and a Market Share initiative that did not succeed.

Dividends and balance sheet

The final Dividend is 71.0 cents per share, fully franked, taking the FY26 total to 98.0 cents, up 7.7%. The Record Date was 9 September 2026 and payment is due on 9 October 2026. The Dividend reinvestment plan remains suspended.

Leverage was 2.30 times at 30 June 2026, and accessible cash and undrawn Debt facilities totalled $330.5 million. The company's FY27 guidance includes higher funding costs, which the company puts at $8.0 million.

Acquisitions and technology

AUB has grown through Acquisition for many years, and it has acquired Prestige. Integrating that Business is a stated FY27 priority. Bolt-on deals also contributed to Australian broking growth. Guidance excludes acquisitions that are not yet known, so any future deals would sit on top of the stated range.

The company also highlighted its use of artificial intelligence, reporting 92% Microsoft 365 Copilot utilisation, 43 active AI agents and more than 40 solutions in the pipeline.

FY27 guidance

AUB guided to FY27 underlying NPAT of $245.0 million to $265.0 million, which is growth of 9.1% to 18.0% on FY26 and a midpoint of $255 million. Guidance assumes a 41% first-half and 59% second-half earnings split.

Key assumptions include a GBP to AUD rate of 1.8975, about 47% of US dollar brokerage income hedged, with roughly US$75 million unhedged, and Central Bank cash rates of 4.60% in Australia, 4.00% in the UK, 3.50% to 3.75% in the US and 3.00% in New Zealand by June 2027. The company says a 1% move in the Australian dollar against the US dollar would change FY27 underlying NPAT by about 0.3% in the opposite direction.

Margin targets and sector conditions

AUB has medium-term EBIT margin targets of 40% for Australian Broking, 42% for New Zealand, 47% for Agencies, 50% for BizCover and 32% for International. FY26 actuals were 38.1%, 33.1%, 43.7%, 47.8% and 27.6% respectively. The largest gaps are in International, where the margin is 4.4 percentage points below target, and New Zealand, which is 8.9 points below. The targets are aspirations, not forecasts.

The wider sector is shifting. Insurance pricing has moderated after several years of increases, and falling cash rates reduce the interest earned on client funds; premium funding interest income dropped 11.6% in the year.

Risks and what to watch

The main risks are further softening in premium rates, reduced interest income, currency movements, weakness in strata and New Zealand, integration of acquisitions and the cost of funding growth. Because a large share of earnings is generated overseas, exchange rates and UK conditions matter more than they once did.

Upcoming reference points include the dividend payment on 9 October 2026, the Annual General Meeting on 12 November 2026, at which Andrew Kendrick is due to retire from the AUB board while continuing to chair the Tysers board, and the half-year result for FY27.

Takeaway

AUB delivered record underlying earnings in FY26 and set out a growth path for FY27, supported by international expansion, bolt-on acquisitions and a spread of businesses. The result depends on conditions that the company does not control, so progress against its own guidance is the key thing to monitor.

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