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AUB forecasts 12-14% earnings growth

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AUB has forecast 12-14% underlying net profit growth this financial year following a strong performance since withdrawing earlier guidance amid uncertainty caused by the COVID-19 outbreak.

“I’m pleased by the financial resilience of the business and the financial performance to date,” AUB CEO Mike Emmett said. “We’re accelerating progress with strategic initiatives and continuing to reduce costs, thereby improving the underlying performance of the group.”

The company at the end of March withdrew its previous forecast, deferred payment of the interim dividend and announced that a proposed deal to fully acquire MGA Whittles would be put on hold.

The group says that given strong earnings performance through April and May and a greater level of insight into the impact of the pandemic it has been able to issue a revised outlook.

Underlying net profit after tax is forecast at $52-$53 million, assuming no significant changes to the seasonally important June Australian broking renewal cycle and based on unaudited financial performance for the 11 months to May 31.

AUB at the start of the financial year forecast profit growth of 8-10%, then raised that to 16-18%, which mostly reflected the expected benefit of the proposed MGA acquisition, as well as a 1-2% uplift in the underlying business.

It has confirmed the deferred interim dividend of 14.5 cents per share will be paid on September 3. The company will make an announcement on its final dividend when it delivers its full-year results on August 24.