AUB Group’s International division delivered a standout performance in the company’s FY26 results, posted to the Australian Securities Exchange today, with underlying net profit before tax surging 19.6% to A$124.5 million. This growth was primarily fueled by the scaling of the group’s UK retail platform and robust activity at its Lloyd’s wholesale broker, Tysers. The division’s EBIT margin expanded by 410 basis points to 27.6%, marking the strongest margin improvement across the entire group. This article breaks down the key drivers behind the International division’s success, including Tysers’ margin expansion, the strategic consolidation of UK retail operations under the Prestige brand, and the currency management strategies in place for FY27. It also provides a broader view of group-level results and guidance, offering a comprehensive analysis for investors and industry professionals.
Tysers Drives International Margin Expansion
The International segment was the single largest contributor to the group’s overall margin improvement, with divisional EBIT rising 24.5% to A$136.4 million. AUB explicitly credited profit growth at Tysers to revenue expansion in marine and aviation lines, coupled with disciplined expense management that offset currency headwinds. In its investor presentation, the group noted that the division also benefited from elevated war rates, a rare explicit acknowledgment from a listed distribution group that geopolitical disruption has driven repricing in marine war and related lines. This factor, rather than pure volume growth or synergy capture, played a measurable role in the margin gain.
AUB provided a detailed bridge showing how the 24.5% EBIT uplift was assembled. The calculation begins with a negative A$11.4 million impact from currency movements, followed by A$13.8 million from organic growth, A$6.0 million from the non-recurrence of a Tysers bonus period realignment in the prior year, and A$18.4 million from acquisitions. Tysers, founded in 1820 and operating from the Lloyd’s market, now sits within an International segment that spans approximately 61 locations, employs around 1,800 staff, and manages roughly A$5.1 billion in premium. This division contributes 31% of group revenue excluding corporate.
Prestige Acquisition and UK Retail Integration
The acquisition of Prestige Insurance, completed in March 2026, is now the primary brand for AUB’s UK retail operations. The group is consolidating Tysers’ retail portfolios into Prestige, a move designed to achieve scale benefits and operational efficiencies. Additionally, AUB completed an investment in Ronesans, which strengthens Tysers’ capabilities in Turkey. For FY27, the group’s execution priorities place UK integration at the top of the list, focusing on completing the retail consolidation and expanding Tysers’ wholesale and specialty capabilities. AUB has set a medium-term EBIT margin target of 32% for the International division, compared to the 27.6% delivered in FY26—representing the second-widest gap of any division.
Currency Management and Hedging Strategy
Currency remains a structural complication for the UK business, and AUB laid out its exposure clearly. On indicative FY27 figures, 53% of International revenue is earned in sterling and 36% in US dollars, while 88% of expenses are paid in sterling. To manage this mismatch, AUB runs a monthly hedging programme, selling US dollars for sterling through to December 2027. Approximately 47% of forecast FY27 US dollar brokerage income is hedged at an average GBP:USD rate of 1.3337. Around US$75 million of brokerage income for the 12 months to 30 June 2027 remains unhedged. The FY27 guidance assumes GBP:AUD of 1.8975 and GBP:USD of 1.3604, along with a UK central bank rate of 4.00% by 30 June 2027. A 1% strengthening of the Australian dollar against the US dollar would reduce FY27 underlying NPAT by roughly 0.3% at the guidance midpoint.
Group-Level Performance and Guidance
At the group level, AUB reported underlying net profit after tax (NPAT) of A$224.6 million, up 12.2%, on revenue of A$1,596.6 million. Statutory net profit fell to A$96.0 million from A$180.1 million, reflecting A$62.7 million of impairment charges and A$48.8 million of amortisation on customer and servicing contracts. The group’s guidance for FY27 is underlying NPAT of A$245 million to A$265 million. CEO Michael Emmett stated, “AUB Group begins FY27 with greater scale, a stronger portfolio and clear opportunities to lift returns for shareholders. In FY26, we delivered record earnings and higher margins, despite moderating insurance markets, while continuing to invest for long-term growth.”
Other Divisional Results
Elsewhere in the group, Australian Broking lifted underlying pre-tax profit 10.0% to A$149.1 million, and BizCover rose 19.9% to A$22.9 million. New Zealand broking declined 3.9% in Australian dollar terms to A$22.3 million. AUB finished the year with a leverage ratio of 2.30 times and A$330.5 million in cash and undrawn facilities. The group refinanced a A$1,097 million syndicated facility in June 2026 and established a A$200 million bilateral facility to support the Prestige acquisition.
Board Change with UK Relevance
AUB also announced a board change with direct relevance to its UK operations. Andrew Kendrick will retire from the AUB Group board at the conclusion of the annual general meeting on 12 November 2026, after almost four years of service. He will continue to chair the board of Tysers. Chair Peter Harmer commented, “Andrew has been an outstanding contributor during his tenure on the Board. On behalf of my fellow directors, I want to thank Andrew sincerely for his service and wish him all the very best in his continuing role with the AUB Group.”
The results come during a significant week for Australia’s two largest broker networks, with Steadfast Group set to release its FY26 numbers on Wednesday. Steadfast, which owns London market broker HWS Specialty, recently entered a scheme implementation deed with a consortium of Amwins, Dragoneer, and KKR in a transaction implying an enterprise value of approximately A$7.7 billion. AUB’s strong International performance, driven by the scaling of its UK retail platform and Tysers’ margin expansion, positions the group well for FY27, though currency volatility and integration execution remain key watchpoints. The clear articulation of margin drivers and hedging strategies provides investors with a solid framework to assess future performance against the medium-term 32% EBIT margin target.
