AUB Group says every division, including its core Australian broking business, performed strongly as full-year underlying net profit after tax rose 32.5% to $171 million and underlying revenue grew 19.8% to $1.33 billion.

The listed intermediary group released its 2023-24 results this morning, when it also flagged plans to grow its Tysers-led UK retail broking operations.

“We delivered another year of revenue growth … we expect another strong year of earnings growth,” CEO and MD Michael Emmett said during an analyst call.

For the current financial year, AUB is aiming for underlying net profit after tax of $190-$200 million.

Mr Emmett says organic growth of 20% was bolstered by profits from acquisitions, which added 17% to underlying earnings.

The Australian broking division remains the group’s “engine room” even as AUB focuses on building its UK retail business, the annual report says.

The division made an underlying pre-tax profit of $120.2 million, up 14.7%, and underlying revenue climbed 8.5% to $563.7 million. Organic growth from increased premiums, client and policy count, and a disciplined bolt-on acquisition approach drove the division’s results.

“Australian broking remains a core part of the AUB group,” Mr Emmett said. “We achieved strong single-digit revenue growth consistent with our long-term average. During the year, we observed a 6% rise in premium rates within Australian broking.

“Simultaneously, we continue to enjoy positive margin ... by effectively managing cost across the portfolio, making solid progress towards our medium target of 40% [earnings before interest and taxes margin] for Australian broking.”

The division recorded a 36.8% EBIT margin in 2023-24.

The agencies division recorded a 57.9% rise in underlying pre-tax profit to $55.4 million, New Zealand broking posted a 59.2% increase to $22.7 million and BizCover reported a 20.9% jump to $15.1 million.

AUB says its UK division, anchored on the Tysers business, is performing in line with expectations. The 2023-24 fiscal period marks the first full year of ownership of Tysers, which AUB bought in 2022 for $880 million.

Tysers EBIT grew 14.1% to $99.4 million on a normalised basis, which takes into account constant currency movements, one-off items and the Lloyd’s wholesale broker’s partial contribution in the previous financial year.

“We continue to realign portfolios and business areas, enhance broking teams and also reduce costs to boost the long-term profitability of the business,” Mr Emmett said.

He says the Tysers business will be referred to as the international division, covering Tysers wholesale, the new UK retail division and any other investments made outside of Australia and New Zealand.

Mr Emmett says AUB has delivered a “step change” in its UK retail strategy, after last year announcing plans for a “significant” retail broking business in the country.

It expanded its UK retail reach with the recent acquisition of a 40% interest in Momentum Broker Solutions, and this week it announced a deal to buy an 80% equity stake in broking business Movo Group.

“Together with our existing Tysers retail operations, these developments mean we now have a stake in a UK retail operation with more than 200 broking partner businesses placing in excess of £300 million ($579 million) in premium,” Mr Emmett said. “This provides AUB Group with substantial retail scale in the UK and significant opportunities for growth.”

In a separate announcement today, AUB said board chair and non-executive director David Clarke will retire after its annual general meeting on October 31.

Non-executive director Peter Harmer, a former IAG CEO, will take over as chair.

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