AUB has almost doubled its outlook for earnings growth this financial year after its MGA Whittles and BizCover acquisitions and says the deals will unlock further long-term potential within the group.

Full-year adjusted net profit guidance was upgraded to growth of 16-18%, from the previous 8-10% outlook, with acquisitions accounting for the majority of the increase, while improvements in existing operations also contributed.

“This will represent a level of profit growth for the AUB Group not seen since 2013,” CEO Mike Emmett told analysts today.

First-half adjusted net profit rose 25.3% to $21.3 million as the Australian broking division benefitted from a 6.2% rise in commercial premiums, while New Zealand was bolstered by last year’s BrokerWeb Risk Services purchase. Agencies and health and rehab earnings also rose.

Including non-cash accounting adjustments and acquisition costs, net profit fell 16.3% to $16.6 million while revenues rose 12% to $162.9 million.

AUB said last week it will acquire full ownership of MGA Whittles for $140 million and 40% of online commercial insurance distribution platform BizCover for $132 million.

MGA has a 9% compound annual growth rate in revenue and operates at a significantly higher profit margin than the rest of Austbrokers, Mr Emmett says. Its advantages “will be leveraged”.

BizCover, which has achieved rapid profit growth, is focused on micro-SME clients, offering a complementary segment to AUB as well as opportunities to provide further services as those clients grow.

“There is significant latent potential in AUB’s network of businesses and the acquisition of MGA Whittles and BizCover will enable us to unlock this potential,” Mr Emmett said.

AUB’s improvement program includes the roll-out of the Austbrokers Express Cover, quote-to-bind platform which uses BizCover technology to speed processing of more standardised products.

The system has been in a pilot phase ahead of a planned national launch at the Austbrokers conference next month.

“Over the next four years we are targeting achieving an annual placement of $450 million of premium and 350,000 policies on the platform,” Mr Emmett said.

AUB is also introducing other technology improvements and says it has streamlined head office, is reducing costs and optimising portfolios.

“This is a significant moment in AUB’s progression as a company,” Mr Emmett said. “We have taken steps to significantly enhance the long-term performance potential of the group and have already made material progress to achieve this.”