Steadfast has raised its earnings forecast after a strong first quarter and says it is well placed to pursue further acquisitions.

Earnings from existing broking and underwriting agency businesses increased 10% last year, while the group achieved growth of 6% from purchased operations.

“We have completed several acquisitions that will make a contribution to [the financial year] and have a strong pipeline,” MD and CEO Robert Kelly told the company’s AGM in Sydney on Thursday.

Since the end of the last financial year Steadfast has bought several more broking businesses and one specialist motor agency, investing a total of $90 million. The company has long-term debt facilities of $385 million, with more than $100 million available to fund growth.

Morningstar analyst David Ellis says an extended period of measured growth via acquisition is expected.

“Despite a successful acquisition track record, the strategy increases risk, particularly in paying for assets and integrating acquired businesses,” he says in a research note.

“We are confident that the disciplined approach will continue, with most acquisitions to come from within the broker network or from long-term partners.”

Mr Kelly says Steadfast network brokers and underwriting agencies achieved better than expected growth early this financial year, supported by insurers’ mid-single-digit price rises.

The group has revised its underlying earnings before interest, tax and amortisation (EBITA) outlook to $190-$200 million and its underlying net profit forecast to $85-$90 million for the year to June 30.

In August it forecast EBITA of $185-$195 million and net profit of $82.5-$87.5 million.

Mr Kelly says extending Steadfast’s international reach remains a key strategy. It has 53 network brokers in New Zealand and Asia, and a 40% stake in global group unisonSteadfast.

It will also continue investing in technology, with the Steadfast Client Trading Platform which is forecast to deliver a small EBITA contribution this year, rising towards a target of $23 million in five years.