The AUB Group Ltd (ASX: AUB) share price has been a strong performer on Tuesday following its full year results release.
At the time of writing the shares of the insurance broker network are up 4.5% to $14.13.
How did AUB perform in FY 2020?
AUB was a positive performer in FY 2020 despite the pandemic and reported solid top and bottom line growth.
For the 12 months ended 30 June 2020, the company delivered a 9.2% increase in revenue to $335.36 million. This was driven by strong growth in its Australian Broking and New Zealand segments over the period.
Things were even better on the bottom line, with AUB delivering its strongest profit growth in seven years. It posted underlying net profit after tax of $53.4 million for FY 2020. This was up 15.2% on the prior corresponding period and ahead of its guidance. Underlying earnings per share came in at 72.45 cents.
In light of this strong performance, the AUB board declared a final fully franked dividend of 35.5 cents per share. This was an increase of 9.2% on the prior corresponding period. It means that for the full year, AUB will be paying a 50 cents per share fully franked dividend. This is up from 46 cents per share in FY 2019.
"Resilient and defensive".
AUB Group's CEO and Managing Director, Michael Emmett, was very pleased with the company's performance in FY 2020 given the challenging economic environment.
He commented: "I am extremely pleased to report our FY20 results, the strongest year on year growth results for the Group in 7 years."
"Despite a challenging external market environment with significant headwinds for our clients and insurance partners, AUB Groups' portfolio has proven to be resilient and defensive, delivering a strong result while maintaining a consistent focus on our FY20 Execution Priorities that enhance our underlying growth drivers. FY20 was also a year of significant change for the business and I'm excited by the response from the partnership and our underwriting partners," he added.
FY 2021 outlook.
The good news for shareholders is that management expects its strong form to continue in FY 2021. In fact, it has upgraded its guidance for FY 2021 with today's release.
It is now forecasting underlying net profit after tax of $58.5 million to $61 million in FY 2021. This represents growth of 9.5% to 14.2% year on year. This is expected to be driven by Australian premium increases in the range of 5% to 6% and small bolt on acquisitions.
