ARB Corporation Ltd. posted a 5.2% decline in full-year net profit for FY26, reflecting weaker sales and broader market pressures, though underlying earnings showed signs of stabilization in the second half.
The company reported net profit after tax of A$92.4 million for the year ended June 30, 2026, down from A$97.5 million in FY25. Sales revenue totaled A$702.0 million, a 3.8% decrease from A$729.9 million a year earlier. Basic earnings per share fell 5.9% to A$1.11. Management attributed the decline to challenging economic and geopolitical conditions that weighed on new 4x4 vehicle sales, particularly in key export markets.
Underlying profit before tax declined 8.9% to A$123.0 million, though second-half performance provided some relief. The second half saw a 1.9% increase in profit before tax compared with the prior year, while the first half experienced an 18.8% decline. Net operating expenses rose 2.8% to A$142.7 million, partly offset by cost controls and operational improvements.
Sales distribution remained heavily weighted toward the Australian aftermarket, which accounted for 55.6% of total revenue at A$390.1 million, down 3.3%. Export sales, representing 38.2% of revenue at A$268.4 million, grew 0.5%, with the U.S. market leading growth at 10.2% in AUD terms. Original equipment manufacturer (OEM) sales, at 6.2% of total revenue, fell 27.2% to A$43.4 million, reflecting softer demand for commercial vehicle configurations.
Geographic performance varied, with the U.S. posting a 10.2% increase in AUD terms, while Europe, the Middle East, and Africa declined 9.4%, partly due to regulatory changes in the UK affecting double-cab pickup registrations. Asia, New Zealand, and the Pacific region saw a 2.1% decline. Top-selling models in Australia included the Ford Ranger 4x4 and Toyota Hilux 4x4, each down 4%, while the Toyota LandCruiser Pickup dropped 38% due to supply constraints.
ARB maintained a strong balance sheet with A$47.9 million in net cash and no debt, though cash holdings declined by A$21.3 million following the payment of A$83.6 million in dividends, including a special dividend of 50.0 cents per share. The company declared a final dividend of 35.0 cents per share, fully franked. Capital expenditure totaled A$36.6 million, primarily directed toward property and plant upgrades.
Management highlighted operational improvements, including a reduction in fitter turnover from 60% to below 50% and an increase in retention rates to over 70%. Customer satisfaction, measured by net promoter score, rose from 68 to 75 over the past 12 months. The company also expanded its U.S. footprint with the opening of a distribution center in Norco, California, following the closure of its Auburn, Washington facility in June 2026.
ARB’s shares rose 14.61% to A$21.65 following the presentation, after an earlier surge of 16.15% to A$21.94.
