AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
_06_24_2025_03_45_59_650550.jpg)
Highlights
- AUB outperforms ASX200 benchmark in past year
- Predictable broker earnings offer resilience
- Strategic investments support long-term growth
In the past 12 months, AUB Group (ASX:AUB) has posted a total shareholder return of 15%, modestly ahead of the 13% gain by the broader ASX200 index. This performance also surpasses rival broker Steadfast (ASX:SDF), which has delivered flat returns over the same period. However, general insurers like QBE Insurance (ASX:QBE), Insurance Australia Group (ASX:IAG), and Suncorp Group (ASX:SUN) have led the pack with gains exceeding 30%, thanks to tailwinds like lower natural hazard claims and higher investment returns.
Yet, such benefits can be fleeting. While insurers ride cyclical highs, brokers like AUB offer steadier income due to diversified revenue streams. Commissions make up a large part of income, but around 30% of AUB’s revenue stems from fixed fees, minimizing exposure to market cycles and volatile claims. This stability provides a firmer foundation for forecasting earnings compared to general insurers.
AUB’s earnings outlook remains constructive, with forecast profit growth of 17% in FY2025, reflecting a mix of organic expansion and acquisitions. Over the next five years, profit growth is projected at 8–9% annually. This trajectory is supported by moderate premium rate increases and the integration of strategic assets like the UK-based Tysers acquisition. Cost and revenue synergies from Tysers are expected to enhance profitability over the medium term.
The company also benefits from its scale. AUB operates the second-largest general insurance broker network across Australia and New Zealand. Ownership or equity participation in each broker business allows it to influence service standards, pricing, and customer support. Scale facilitates better policy negotiation, advanced data analytics, and efficient customer acquisition.
AUB’s growth strategy extends to digital platforms and partnerships. Its stake in BizCover, a self-service insurance solution for small businesses, is an example of targeting niche markets. Additionally, its collaboration with accounting firm Kelly+Partners is designed to generate leads among SMEs—segments often served by direct insurers. Such initiatives should gradually increase AUB’s market share.
Despite macroeconomic uncertainties and insurance cycle risks, AUB’s positioning as a resilient and scalable business in the financial services space sets it apart. While general insurers may see profit pressures due to rising claims and potentially lower investment income, brokers like AUB continue to demonstrate earnings consistency, technology-driven scalability, and long-term growth prospects within the ASX200.
