AMA Group’s Recapitalisation and Turnaround Plans Face Key Tests Ahead
AMA Group reported a robust FY25 with revenue surpassing $1 billion and a 38% jump in normalized EBITDA, underpinned by operational improvements and a strengthened balance sheet.
- FY25 revenue climbs 8.6% to $1.014 billion
- Normalized EBITDA rises 38.4% to $62.6 million
- Operating cash flow improves over 300% to $44.1 million
- Balance sheet recapitalised with $125 million equity raise and debt refinancing
- Strategic growth plans include 3-4 new or expanded sites annually
Strong Financial Performance
AMA Group has delivered a notably strong financial performance for the fiscal year ending June 2025, with total revenue reaching $1.014 billion, an 8.6% increase over the prior year. The company’s normalized EBITDA, a key profitability metric excluding certain accounting adjustments, surged by 38.4% to $62.6 million, reflecting improved operational efficiencies and higher repair complexity across its core vehicle collision repair businesses.
Operating cash flow saw a dramatic improvement, rising by 317.9% to $44.1 million, signaling enhanced cash management and collection processes. This cash flow strength supports the company’s ongoing investments and strategic initiatives.
Balance Sheet Recapitalisation and Debt Refinancing
AMA Group undertook significant balance sheet strengthening during FY25, completing a $125 million equity raise in August 2024. The proceeds were partly used to repay $53.8 million of senior debt and $50 million of convertible notes, substantially reducing net debt from $143.9 million to $17.7 million by June 2025. Additionally, the company refinanced $110 million of debt with a new three-year facility extending to February 2028, improving financial flexibility.
Operational Highlights Across Business Units
Capital SMART, the largest segment, reported revenue growth to $490.3 million and a 29% increase in normalized EBITDA to $58.4 million, driven by a pricing reset with key insurer Suncorp and an expanded repair scope tackling more complex vehicle damage. AMA Collision showed a turnaround with a $7.4 million EBITDA, up $3.2 million, supported by a transformational change program and stronger insurer relationships.
Wales Heavy Vehicle continued its strong trajectory with a 13.5% EBITDA margin and positive results from recent acquisitions and site optimizations. Specialist Businesses, including Prestige and TechRight, experienced mixed results but are focused on operational resets and measured expansion. ACM Parts, while growing revenue by 17.5%, remains a turnaround candidate with an operating break-even second half and ongoing initiatives to improve profitability.
Looking Ahead – Growth and Efficiency
AMA Group is targeting further growth with plans to add or expand 3-4 sites annually, aiming to increase weekly repair volumes from 4,773 to 5,000. The company is focused on achieving a 10% normalized EBITDA margin in its core vehicle collision repair businesses over the coming years. Operational improvements, network rationalization, and capability development remain priorities, alongside strategic growth through greenfield, brownfield, and acquisition opportunities.
The company also announced a proposed 1-for-10 share consolidation to be considered at the upcoming Annual General Meeting, reflecting a focus on shareholder value and capital structure optimization.
Bottom Line?
AMA Group’s FY25 results mark a turning point, but the path to sustained profitability, especially for ACM Parts, will be closely watched.
Questions in the middle?
- How will AMA Group navigate the turnaround of ACM Parts amid ongoing challenges?
- What impact will the proposed share consolidation have on investor sentiment and liquidity?
- Can AMA sustain growth and margin expansion while managing network rationalization and operational complexity?
