AMA Group Limited

Thank you for standing by and welcome to the AMA Group HY26 results briefing. There will be a presentation followed by a question and answer session. If you wish to ask a question via the phones, you will need to press the star key followed by the number 1 on your telephone keypad. To ask a question via the webcast, please enter it into the ask a question box and click submit. I would now like to hand the conference over to Ray Smith-Roberts, Group Managing Director. Please go ahead.

Good morning everyone. Thank you for taking the time to join us for the presentation of the AMA Group FY26 half year results. For those of you joining us via webcast, you should be able to view the presentation on your screen. If you're joining us via teleconference, you should have access to it via our investor presentation on the ASX platform or our company website. I'll begin today's presentation with a business update along with details of our portfolio business results. I'll then hand over to our Group CFO, Dom Romanelli, who will take you through the Group Financials. I'll then return a bit later to cover Outlook. We'll be taking questions throughout the webcast facilities today. You can submit these at any time during the presentation and we will address them at the end. So if we get underway, let's begin on slide four, a bit of a 1.5-26 overview. I'm pleased to report that AMA Group produced the first half result for FY26 of pre-AASB 16 normalised EBITDA of $30.5 million. That's up almost 22% on the first half of FY25 and continues our positive profit growth trajectory. In conjunction with our profit growth, our operating cash flow also improved by 16.2% for the corresponding reporting period. This solid result we have delivered for the first half is headlined by continued strong performance in the Capital Smart Network, considerable improvement in the financial performance of our AMA Collision Network and ACM parts contributing a positive EBITDA to the Group for the first time. We are a people business and have continued to focus on upskilling, growing and retaining our team, always in a safe manner. Our LTIFR of 3.1 as at the 31st of December 2025 is down from 4.2 in the corresponding period. We've increased our team by 37 members and maintained our voluntary turnover at very good rates. So if we look at the headline of our businesses, Capital Smart achieved EBITDA of $24 million for 1.526, which is down from the $25.8 million of 1.525, but that is in line with our expectations. AMA Collision continue on its good progress in its optimisation and capability improvement program, with an $8.1 million EBITDA improvement in the first half of FY26 compared to the first half of FY25. With continuing focus in our disciplined approach, there is significant opportunity for further improvement to continue to drive improved financial performance. Wales' performance was impacted by software provisions of large crash repair work and improved financial performance is expected in the second half of FY26. The specialist business has seen significant improvement in financial performance, in particular within and inside our Prestige network. In relation to ACM parts, it continues to improve its financial performance as it implements continued operating improvement actions. Overall group revenue of $524.1 million increased $29.6 million on the first half of FY25. That's a 6% increase. With revenue from our core vehicle collision repair businesses increasing 6.6% to $503.5 million. Normalised half 1 FY26 pre-AASB 16 EBITDA of $30.5 million. This is up $5.5 million or 21.9% on the first half of FY25. Now EBITDA margin has increased from 5% up to 5.8% in the first half of FY26. Operating cash flow after the payment of lease cost was a positive $12.2 million, an improvement of $1.7 million or 16.2% on the first half of FY25. Underlying financial performance, improvement in key strategic growth is expected to continue into the remainder of this year and beyond, and we'll cover that in more detail later in Outlook. Now if we move on to the specific slides on each business. Slide 5, Capital Smart. In the first half of FY26, Capital Smart was in line with expectations. Capital Smart continues to deliver improved customer outcomes in conjunction with our key customer Suncor. Despite moderately lower volumes, particularly in Victoria, revenue increased as a result of higher severity and complexity of repairs. As previously indicated, 1.525 and 2.525 both included incentives which have not been nor were they expected to be replicated in FY26. This has impacted the EBITDA margin slightly, reducing it as expected. Continued cost control measures and productivity initiatives will preserve margins going forward. Three new sites were opened in the first half of FY26, one in South Australia, one in Newcastle in New South Wales and one in Tasmania. These are all locations where opportunity is strong and where our network is underrepresented. These will deliver incremental EBITDA as they ramp up in operations. We did close one site in New Zealand during the first half of this period. We have two further site expansions planned for this calendar year, one in Sydney and one in Adelaide, and hopefully they'll both be up and running before the end of the calendar year as said. Overall, revenue increased $7.8 million to $245.9 million, an increase of 3.3% on the corresponding period. Normalised half 1.26 pre-AASB 16E draft $24 million is down $1.8 million on the first half of 25. Capital Smart will pursue further optimisation and growth, with focusing on optimising operations through insourcing, timely repairs and utilising technology. We will continue to develop the workforce by attracting and training and mentoring high-performing people. And we will continue to invest in a nationwide network in both refurbishment of existing sites and new sites, where key opportunity locations are aligned to our customer needs. and will continue to evolve and enhance our customer experience and convenience. If we move on to the collision business, turning to slide 6. The transformational change program within OMA Collision Business continues with significantly improved financial performance as mentioned. Revenues increased $18.4 million to $194.1 million, an increase of 10.5%, and normalised EBITDA for 1.526 pre-AASB 16 of $6.1 million is up $8.1 million from 1.5 FY25. The operational optimisation and key capability focus within the business continues to achieve results. This discipline focus will continue for the remainder of this year and into next year, with further upside from existing operations will be derived. Key insurance customer relationships continue to improve and strengthen. The business will continue to focus on network optimisation, including investment in vehicle repair capacity, team capability and customer experience. This will include site rationalisations and site expansions where appropriate. In addition, we will see strategic growth where opportunity, capability and capacity are aligned. Overall, a very pleasing result in collision. We turn to slide 7 and the Wales Heavy Vehicle Division. The Wales Heavy Vehicle business was impacted by some softer work provisions in this last half. In half 1.26, it delivered a normalised pre-AASB 16 EBITDA of $3.8 million, down $1.6 million from one half FY25. There has been a shift in work mix during this period, with reduced claim volume and large-scale repairs being lower, impacting growth in some states. This is expected to persist in the short term, but more large-scale repairs are expected to normalise over the next 12 months. Wales is well placed to take on more volume with capacity available as the volume returns, with additional opportunities being explored with insurers, government, corporate and private fleet operators and insurance brokers. The business continues to strengthen its relationship with both market leading insurers and smaller insurers and fleets who are seeking preferred repairers, as well as continue to expand its service offering with different types of repairs including machinery, motorhomes and specialist equipment. We turn now to slide 8, our specialist division. AMA Prestige Sites, Revenue and EBITDA were well ahead of the prior corresponding period. Its financial performance was improved on the back of improved productivity following a range of initiatives being implemented. The business will continue to focus on enhancing capability and strengthening key OM and insurance relationships. The TechRight business volumes have increased in 1.526 compared to the prior corresponding period, which has led to improved financial performance. Development plans continue where appropriate. Our truckwright mechanical division, the financial performance was also ahead of last year and the prior corresponding period. Work on optimising these sites in Queensland and Western Australia continues. We move to Slide 9, ACM Parts. The ACM Parts business continues to improve with positive pre-AASB16 normalised EBITDA of $0.7 million, up $1.4 million to the corresponding period. There was a strong uplift in financial performance as key initiatives relating to the reclaim and genuine parts businesses and growth in the consumables business have yielded positive results. Network optimisation or our warehouse capacity remains a key focus with a planned relocation of a site to a more fit for purpose facility currently underway. The business has seen a strong uplift in external revenues. This is attributed to a strong focus on operational quality and service performance, along with a competitive offering given from improved sourcing. Procurement continues to be one of the business's biggest opportunities. With the business now self-sustaining and continuing to improve its performance through these operational efficiencies, we will continue to focus on the outcomes we can control and maximise value for our company. I will now hand you over to Don to take you through the group financials.

Thanks Ray and good morning everyone. Slide 11 is a summary of the first half FY26 financial performance. The financial performance is presented on a post-AASB 16 basis below EBITDA. However, we have included supplementary analysis on slide 19 which provides a comparison of first half FY26 results on a pre and post AASB16 basis. As Ray has outlined, our first half FY26 financial performance was a continued improvement on the first half of FY25 with revenues up $29.6 million or 6% to $524.1 million. and normalised pre-AASP EBITDA of $30.5 million up $5.5 million, 22% up on the first half of FY25. This reflected an EBITDA margin improvement from 5.0% to 5.8% for the first half of FY26. If we look at purely at our core vehicle collision repair businesses, our EBITDA percentage margin grew from 5.4% to 5.9%. This uplift was largely driven by the continued operational performance of our AMA collision, specialist and ACM parts businesses. Finance costs in total were down $1.5 million for the first half of FY26 when compared to the corresponding first half period. Fleecingly, finance costs other reduced by $3.7 million for the first half year, due to the improved cost of funding and debt levels following the refinancing of the Group's senior debt in February 2025. This benefit was partially offset by an increase of $2.2 million in the finance cost of our leases, reflecting the increase in market rents and interest rates. Consistent with FY25, there is no dividend declared for the first half of the 26 financial year. And the increase in income tax expense reflects the uplift in earnings, particularly within the Capital Smart Tax Group, the non-deductible nature of our P&L expense relating to our Executive Share Plan and prior period under-provision adjustments that have been corrected. The normalisations we have called out for the first half of FY26 relates to planned site closures within AMA Collision which represents $0.8 million and the planned ACM Warehouse relocation of $0.6 million. The normalisation in the corresponding period of $3.5 million related to a legal settlement claim relating to an earn out of an acquisition that took place in 2018. Turning to slide 12 and the summary financial position. We ended the first half to 31 December 2025 with net debt of $20.7 million, a slight increase from the 30 June 25 balance of $17.7 million. Our balance sheet remains strong and provides the organisation the capability to execute its capital expenditure program. The Group continues to meet all its financial covenants and expects to operate within them for the next 12 months. and we also completed a 1 for 10 share consolidation during this period. Now to slide 13. The Group had positive operating cash flows of $12.2 million for the first half of FY26, once the principal elements of lease payments are taken into account, which was an improvement of $1.7 million or 16.2% on the corresponding half year period. This was driven by the Group's stronger EBITDA, continued improved cash management, albeit we are now starting to pay income taxes, which we will continue to increase in the second half of the financial year, and $2.5 million reduction in interest paid due to our improved customer funding. The first half of the financial year saw capital expenditure payments of $15.3 million, an increase of $5.6 million on the corresponding half-year period. This was primarily due to investment in greenfield sites and investment in replacement equipment and site expansions. The group has a healthy cash position at 31 December 2025. Turning to slide 14. Normalised corporate costs were $2.2 million higher than in the corresponding half-year period. This was predominantly due to a higher expense of $2 million relating to an executive share plan in this half year period compared to the corresponding half year period. This expense is of a non-cash nature and is only deductible for income tax purposes if the shares ultimately vest. The normalisation noted in the slide for the last year's half year period related to the legal settlement claim over the year now calculated on a 2018 acquisition. In addition, slides 18 to 21 provide additional financial information that will assist with your analysis. I'll now hand back to Ray.