Suncorp Group (SUN) H1 2026 earnings summary

Executive summary

• Net profit and cash earnings fell to AUD 270 million (profit after tax $263 million), down sharply from the prior period due to extreme weather events and negative bond portfolio movements.

• Strong growth in Consumer portfolio, especially in Motor and Home, with underlying insurance result and margins at the top end of the target range.

• Nine declared natural hazard events led to AUD 1.3 billion in claims, with hail accounting for over AUD 700 million.

• Interim fully franked dividend of AUD 0.17 per share declared; payout ratio at 68%.

• AUD 168 million buyback completed, with plans to resume and target AUD 400 million by FY 2026.

Financial highlights

• Insurance revenue was $7,656 million, up from $7,509 million year-over-year.

• Net investment income dropped to $259 million from $374 million year-over-year.

• Underlying ITR/UITR at 11.7%, in the top half of the 10%-12% range.

• Expense ratio reduced to 18.0%, reflecting ongoing cost control and productivity investments.

• Strong prior year reserve releases of AUD 65 million (90 bps), mainly from commercial and workers' portfolios.

Outlook and guidance

• GWP growth expected at the bottom of the mid-single digit range (4%) for FY26.

• Underlying ITR/UITR expected to remain in the top half of the target range, supported by premium rate increases.

• Operating expense ratio targeted at approximately 25%, with more expenses allocated to growth.

• Buyback to resume, targeting AUD 400 million by FY 2026.

• Capital management strategy focused on maintaining CET1 capital in the top half of the target range.