Austbrokers ((AUB)) has added another bunch of acquisitions to its stable of insurance broking businesses, contributing to the scale of the company’s Austagencies division. Total gross written premium for the insurance underwriting agency business is now expected to be over $210 million on an annualised basis.
Insurance broker Austbrokers Holdings (AUB) delivered what the market viewed as a high quality result yesterday, UBS pointing out every financial metric it measures continues to point in the right direction as organic growth is accelerating and cash flows and ancillary revenue streams both increased.
AUB has downgraded FY19 profit growth guidance to 3-5% growth from a prior 7-12%, citing substantially lower NSW workers comp case volumes and an over-run in the cost of a new underwriting agency IT system
Austbrokers’ result fell 8% short of the broker, with increased expenses overriding increased fee income. AUB benefitted in FY13 from higher interest rates, favourable commissions and rising premium rates but all of those factors are easing back in FY14, the broker notes. This means AUB has to increase its expense base to fund future growth and that growth won’t kick in for a while.