AUB Group has forecast strong growth this financial year as its UK Tysers acquisition provides benefits while premium rate momentum continues. 

The company last week said underlying net profit is expected to rise to $154-164 million, representing an increase of 19.3-27% on the past financial year. 

“This represents strong growth across all parts of the group and a continued focus on delivering synergy benefits from Tysers,” Group CEO Michael Emmett told a results briefing. 

AUB raised its medium-term target margin for Australian broking to 40% from 38% and boosted the BizCover target to 50% from 40%. The New Zealand broking margin target was increased to 42% from 40% and for Tysers it was upgraded to 32% from 30%. For agencies the target margin remains at 45%. 

Mr Emmett says early indicators suggest estimates of potential synergies and efficiencies from the acquisition of Tysers were conservative, while teams across AUB had “delivered exceptionally” in the past financial year. 

 “Particularly pleasing is the continued growth of agencies and the significant turnaround in New Zealand,” he said. 

Underlying net profit for the year to June 30 rose 74.4% to $129.1 million from $74 million, while revenue increased 61.2% to $1.11 billion. 

In a nine-month contribution Tysers delivered an underlying pre-tax contribution of $76.9 million, with revenues 5.4% above initial forecast. Australian broking profit rose 21.6% to $104.8 million, BizCover profit rose 18.9% to $12.5 million and New Zealand profit jumped 59.4% to $14.3 million. 

AUB also outlined plans to coordinate the business across three global divisions encompassing retail broking, wholesale broking, and agencies, with key leaders to be appointed in the coming 12-18 months. 

Mr Emmett said he would be taking up the role of Tysers CEO on an interim basis from Clive Buesnel, who is leaving the company this week after assisting with the ownership transition, with the intention to appoint a new global head of wholesale broking based in the UK this fiscal year.  

In a board succession announcement, AUB also says Paul Lahiff is retiring as a director and as Chair of the Remuneration and People Committee after almost eight years of service, with a search underway for a replacement.