ARB (ARB) H1 2025 earnings summary

Executive summary

• Sales revenue grew 5.9% year-over-year to AUD 361.7 million in 1H FY2025, with export sales up 15.4%, Australian aftermarket up 1.9%, and OEM sales down 1.3%.

• Profit before tax declined 0.7% to AUD 70.3 million; profit after tax down 0.6% to AUD 51.0 million; underlying profit after tax (excluding non-operating items) down 4.6%.

• Significant investments in people, new sales channels, and U.S. expansion, including the acquisition of 4 Wheel Parts and MITS Alloy, and increased stake in Off Road Warehouse to 50%.

• Interim fully franked dividend of AUD 0.34 per share declared, payout ratio 55.1%, unchanged from last year.

• ARB celebrated its 50th anniversary, reinforcing its commitment to growth and innovation.

Financial highlights

• Underlying profit before tax down 4.5% year-over-year due to higher employee expenses and transaction costs.

• Earnings per share declined 1.2% to 61.7 cents; adjusted EPS was 61.14 cents, down 5.1%.

• Gross margin maintained at upper historical range; materials and consumables improved to 41.4% of sales.

• Employee costs rose AUD 14 million (18.1%) due to headcount and strategic roles.

• Cash from operating activities at AUD 45.9 million, with inventories rising to AUD 278 million.

Outlook and guidance

• Aftermarket and export order books remain healthy, with daily order intake strong and export growth expected to continue in H2 2025.

• OEM sales projected steady for 2025, with new contracts under negotiation.

• U.S. investments expected to drive medium- to long-term growth; management optimistic about ongoing U.S. profitability.

• Margins expected to hold, but FX volatility (weaker AUD) is a key risk for H2 2025.

• Ongoing investment in product development, store network, and people to support long-term growth.