McMillan Shakespeare Ltd (ASX: MMS) shares have dropped 5.25% in Monday afternoon trade. At the time of writing, the ASX 300 stock is trading at $16.62 per share. The drop follows the company's half-year results for FY26, which it posted ahead of the market open early this morning.
Today's decline means the employee benefits provider's shares are now 3.15% lower for the year to date, but still 19.23% above where they traded this time last year.
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Why the ASX 300 stock is falling on results day
Here's what McMillian Shakespeare posted for the six months ending 31st December 2025:
- Statutory net profit after tax (NPAT) up 9.7% to $49.6 million
- Underlying net profit after tax and amortisation (UNPATA) up 1.4% to $50.3 million
- Group revenue up 11.2% to $297.4 million
- Half-year fully-franked dividend of 62 cents
What happened in H1 FY26?
McMillan Shakespeare reported a statutory NPAT from continuing operations of $49.6 million. This was up 9.7% from the first half of FY25.
The company also reported a 1.4% increase in its UNPATA to $50.3 million, although this was 7% below market expectations.
Group revenue reached $297.4 million for the six-month period, up 11.2% on the prior corresponding period (pcp), driven by growth across all segments.
McMillan Shakespeare's novated leases segment was up 7% on the pcp. The increase was supported by new customer growth, improved retention, and increased penetration into the salary packaging client base.
The Oly segment grew its client base by 233% on the pcp, accounting for 5.2% of all group novated lease sales during the period.
Meanwhile, the onboard Finance receivables segment grew strongly, up 31% to $539 million.
The board announced a half-year fully-franked dividend of 62 cents. It said this reflects the midpoint of its stated dividend payout policy of 70% to 100% of UNPATA. The board added that McMillan Shakespeare will undertake an on-market buyback of shares up to a value of $10 million over the next 12 months. The interim dividend announcement was a miss versus market expectations.
McMillan Shakespeare's CEO and Managing Director, Rob De Luca, said: "The Group delivered growth in financial performance in the half underpinned by an increase in revenue across all segments and an uplift in productivity to offset inflation."
"MMS continues to pay dividends within our stated policy range of 70%-100% of UNPATA, balancing investments for future growth and returning capital to investors. This half we will pay an ordinary fully franked dividend of ~85% of UNPATA and undertake an on-market buyback of up to $10 million over the next 12 months, reflecting total announced capital returns of up to $53.2m, up 7.6% on 1HFY25 ($49.4m)."
What's the outlook for the H2 of FY26?
The company said it expects its UNPATA to benefit from customer growth across all segments. It also expects increased Onboard Finance receivables and efficiencies from prior year strategic investments in the second half of FY26.
It notes that the Federal Government's review of the Electric Car Discount is underway. The NDIS annual pricing review outcomes are also expected in the next six months.
The company said it will "continue to take a disciplined approach to investing in and executing on our strategic priorities – excelling in customer experience, driving simplicity and technology-enablement, and delivering valued solutions".
