Steadfast today reported a 37% rise in after-tax net profit in the last financial year to $103.8 million, fuelled by the ongoing premiums upturn and earnings growth from  acquisitions.

The broker network remains firmly on the acquisition trail, announcing the launch of an institutional share placement to raise $100 million, which would be used partly for investing in new brokerages and underwriting agencies.

Underlying net profit in 2018/19 went up 19% to $89.2 million and underlying earnings before interest, tax and amortisation (EBITA) gained 17.8% to $193.3 million. The results fall within the revised guidance set last October by the group.

“It was a strong performance in line with our upgraded guidance,” MD and CEO Robert Kelly said in an earnings conference call after the results were released earlier today.

“This was driven both by organic growth of 10.9% and acquisition growth at 6.9%, with record premiums for both for [the] Steadfast Network and underwriting agencies.”

The Steadfast Network achieved a record $6.1 billion in gross written premium (GWP) last financial year, up 16%. The underwriting agencies arm also brought in a record performance, with GWP rising 28% to an all-time high of $1.2 billion.

For the current financial year, Steadfast is expecting underlying net profit of $100-110 million and underlying EBITA of $215-225 million.

“We are looking at [2019/20]… the major assumptions are that our strategic partners continue to drive moderate premium price increases,” Mr Kelly said.

“I think we would definitely be able to say that they are definitely going to be in the 5-7.5% range, which is pretty good when you consider what has been going on for the past 18 months.”

The earnings target also takes into account the previously announced bid in June for Insurance Brokers Network Australia (IBNA). Steadfast is expecting a minimum 80% acceptance rate from IBNA members, which would involve up to $70 million of scrip to be issued.

The bidder statement will be despatched tomorrow to IBNA shareholders.

Excluding the IBNA bid, Steadfast spent about $136 million in the past financial year on new businesses. It bought the remaining 50% stake in Macquarie Pacific Premium Funding, which has since been renamed iQumulate, acquired Community Broker Network from IAG and took on a majority stake in specialist underwriting agency Heavy Motor Insurance Australia.