Mortgage Advice Bureau Cuts H1 2026 Profit Guidance Amid Market Challenges

Mortgage Advice Bureau PLC (MAB) has revised its adjusted profit before tax guidance for the first half of 2026, cutting it to around £38 million—a 5% to 6% year-over-year decline—due to slower-than-expected refinancing volumes and elevated administrative costs. The company reported H1 2026 revenue of £160.97 million, up 8.6% year-over-year, with gross profit rising 15.6% to £47.4 million. However, adjusted profit before tax increased only 2.1% to £14.8 million, reflecting a profit margin of 9.2%, down from 9.9% in H1 2025. Total mortgage lending grew 16% to £16.5 billion, driven by a 44% increase in product transfers, though remortgage activity rose 29% versus a market growth of 40%. Mortgage procuration fees surged 12% to £67.2 million, while protection and general insurance commissions climbed 7.8% to £60.1 million. Client fees remained flat at £30.1 million, and adjusted administrative expenses rose 21.6% to £32.5 million, straining profitability. Free cash flow declined to £11.8 million from £14.6 million in the prior period, while net debt stood at £15.1 million (0.4x leverage). The interim dividend rose 10% to 7.9p per share, representing £4.5 million in cash returns. CEO Peter Brodnicki emphasized that market conditions—including a flat refinancing pipeline and cautious second-half productivity—prevented achieving higher guidance. Fluent’s mortgage arm is being integrated into First Mortgages, a strategic shift toward protection sales decoupled from mortgage transactions. A rebrand to MAB is planned for November 2026, alongside a new franchise model. Shares fell 4.05% premarket to £367.5, trading down 2.22% at £354.45, with a 52-week range of £350–£818. The P/E ratio stands at 17.42 and the dividend yield at 6.2%. The Financial Conduct Authority’s review of pure protection was deemed a clean bill of health. Management remains confident in long-term growth, citing a diversified business model and consistent performance across market cycles.