Key Highlights

• ARB reported FY26 results on 25 August 2026 for the year ended 30 June 2026.

• Reported net profit after tax was $92.4 million, down 5.2%, while profit before tax was $123.0 million.

• Excluding one-off items, net profit was $89.0 million, down 7.5%.

• Excluding one-offs, profit before tax was $58.0 million in the first half and $60.7 million in the second, an improvement of 4.7%.

Can a Business that has just reported lower sales and profit still be seen as heading towards recovery? For ARB Corporation (ASX:ARB), the answer depends on vehicle supply. FY26 Revenue and profit fell, yet profit improved in the second half and management says the outlook remains positive, while a first-quarter update at the October Annual General Meeting showed the recovery is not yet visible in sales.

The central development: a softer year with a steadier second half

ARB reported FY26 results on 25 August 2026 for the year ended 30 June 2026. Sales revenue was $702.0 million, down 3.8%. Reported net profit after tax was $92.4 million, down 5.2%, while profit before tax was $123.0 million. Excluding one-off items, net profit was $89.0 million, down 7.5%.

The shape of the year matters. Excluding one-offs, profit before tax was $58.0 million in the first half and $60.7 million in the second, an improvement of 4.7%. The company said gross margins, which were squeezed early by a more encouraging Thai baht, had recovered to be in line with FY25.

The total ordinary Dividend was 69 cents per share, fully franked and unchanged from FY25. A final dividend of 35 cents was paid on 23 October 2026. FY25 had also included a 50 cent special dividend, so total distributions this year were lower.

What ARB does and where its revenue comes from

ARB designs, manufactures and sells four-wheel-drive accessories, including bull bars, suspension, roof racks, canopies, lighting, winches and the Air Locker differential locker. Products are built mainly in Australia and Thailand and sold through ARB-branded stores, independent retailers and vehicle manufacturers.

In FY26, the Australian aftermarket made up 55.6% of sales, exports 38.2% and original equipment (OE) 6.2%. Exports grew 0.5% to $268.4 million. OE sales fell 27% to $43.4 million, which the company attributed to a lack of vehicle supply.

The network includes 80 ARB stores, 33 of them company-owned. Plans for FY27 include three new stores and five flagship upgrades.

Operating performance by region

Management described the United States as showing positive momentum, and moved its west coast distribution centre from Washington to California. Europe and South-East Asia performed well. The United Kingdom was weaker because pick-up registrations were materially lower on tight vehicle supply, with a recovery expected in the first half of FY27. The Middle East was significantly affected by regional conflict.

New markets are being built. A wholly owned Chinese enterprise began operating late in the year, and a South African Subsidiary with a Warehouse is due to be operational in the first half of FY27.

Financially, ARB held $47.9 million of cash and no Debt at 30 June 2026. Operating Cash Flow was $103.7 million, down 19% on Working Capital and higher foreign-currency operating costs. Capital Expenditure on property and equipment was $36.6 million, and the board approved higher engineering Investment over coming years.

Latest update: first-quarter sales lower, profit higher

At the annual general meeting on 15 October 2026, ARB said first-quarter FY27 sales were down 6.1%. Single-digit declines in the Australian aftermarket and exports were partly offset by encouraging OE growth. Unaudited profit before tax grew despite lower sales.

The company said Australian new 4x4 sales fell 16%, with more than half of that decline related to Ford and Toyota Supply problems that it expects to resolve. A Ford Ranger recall and a Toyota HiLux stop-sell also weighed on aftermarket revenue. The presentation noted that the Ranger regained its place as Australia's best-selling vehicle in September 2026.

These are unaudited management statements, so they indicate direction rather than a final result.

Sector conditions and competitive position

ARB's fortunes follow new-vehicle availability, particularly for popular utes and large four-wheel drives. Its results indicated that Toyota has signalled significantly improved FY27 supply of the HiLux, Prado, LandCruiser 300 Series and the reintroduced LandCruiser 70 Series, although the timing of any recovery remains uncertain. The company itself said its recovery is closely tied to Toyota volumes.

Its competitive strengths are Brand recognition, in-house engineering and manufacturing, and relationships with vehicle makers. Engineering has started on accessories for the next Ford Ranger and Everest under the Ford Licence Accessory programme, and the company has won two new US OE contracts, one for an electric platform. Those contracts start in FY28, so they are not near-term Earnings drivers.

ARB also said it outperformed the broader decline in Australian 4x4 sales in FY26, and that its order intake and order book remained at FY25 levels. Market-share figures were not published, so the extent of any gain cannot be measured.

Risks and uncertainties

The company named several headwinds: ongoing United States Import tariffs, elevated shipping costs, geopolitical uncertainty and softer 4x4 Demand and supply. Currency is another variable. The Thai baht strengthened during FY26, and the company said it is hedged through February 2027, after which exposure may change.

Dependence on a small number of vehicle makers cuts both ways. Supply improvements could lift sales, but recalls, stop-sale orders or production delays can quickly reduce demand for accessories. Export growth also relies on newer operations in China and South Africa, which are early in their development.

What to watch next

Several milestones are visible. The first half FY27 result, typically released in February, should show whether second-half Margin recovery has been sustained. Monthly Australian 4x4 registrations, UK registration trends, the South African warehouse start and Tariff developments are also worth following.

ARB has no debt and a record of paying consistent dividends, which provides some resilience while volumes are subdued. However, sales declined in both FY26 and the first quarter of FY27, so a return to growth is not guaranteed.