ARB Corporation Ltd reported a full-year FY2026 profit before tax of AUD 123 million, an 8.9% decline from AUD 134.9 million in FY2025, despite a second-half rebound that lifted shares 16.15% to AUD 21.94.
The company’s underlying profit before tax, excluding one-off items, totaled AUD 118.6 million, down 10.5% year-over-year. Profit after tax fell 5.2% to AUD 92.4 million, with basic earnings per share declining 5.9% to AUD 1.11. Revenue decreased 3.8% to AUD 702 million from AUD 729.9 million in the prior year.
CEO Lachlan McCann attributed the challenges to softer new vehicle 4x4 sales globally, driven by supply constraints and demand softness. He emphasized ARB’s local manufacturing advantage, noting the company’s early market entry for accessories on the Ford Ranger Super Duty and Toyota Hilux. CFO Damon Page highlighted an improving trend in the second half, with profit before tax rising 1.9% to AUD 65.9 million, supported by margin recovery.
Sales distribution reflected mixed performance across segments. Australian aftermarket sales, the company’s largest revenue stream at 55.6% of total, declined 3.3% to AUD 390.1 million. OEM sales in Australia dropped 27.2% to AUD 43.4 million, while export sales edged up 0.5% to AUD 268.4 million, with the Americas growing 10.2%.
Gross margin improved to 57.6% from 56.7%, though employee expenses rose 1.9% to AUD 179.5 million, reflecting a 3.5% annual wage adjustment. Materials and consumables costs fell to 42.4% of sales from 43.3%. Depreciation and amortization increased 9.8%, while occupancy and other expenses rose 2.5% and 6.3%, respectively.
The company maintained its dividend policy, paying a fully franked final dividend of AUD 0.35 per share, unchanged from FY2025. Total dividends included the FY2025 special dividend of AUD 0.50, the FY2025 final dividend of AUD 0.35, and the FY2026 interim dividend of AUD 0.34. ARB has paid dividends for 35 consecutive years.
Cash and cash equivalents stood at AUD 47.9 million with no debt, though net cash declined by AUD 21.3 million during the year. Operating cash flow totaled AUD 103.7 million, while capital expenditure reached AUD 36.6 million, including AUD 24 million on property and AUD 12.6 million on plant and equipment.
Looking ahead, ARB plans to expand its store network by 3 to 5 new locations annually, with engineering investment set to grow 10% to 15% per year. Hedges remain in place until November 2026.
