How Did MaxiPARTS Achieve Record Margins and a 20% Dividend Boost in FY25?

Strong Financial Performance Amid Market Headwinds

MaxiPARTS Limited (ASX, MXI) has unveiled a solid set of financial results for the year ended 30 June 2025, showcasing resilience and strategic execution in a challenging commercial vehicle parts market. The company reported revenue of $267.1 million, marking a 9.5% increase over the previous year, while EBITDA climbed 18.4% to $27.3 million, lifting the margin to a record 10.2%. This margin improvement is particularly notable given the competitive pressures and softer transport activity across Australia's east coast.

Net profit before tax from continuing operations rose 38% to $12.7 million, reflecting disciplined cost management and a focus on higher-margin product lines. Operating cash flow nearly doubled, reaching $17.3 million, enabling the company to reduce net debt by over 50% to $7.2 million and achieve a leverage ratio of just 0.3 times, well within its capital management targets.

Growth Fueled by Strategic Acquisitions and Operational Initiatives

The company’s growth trajectory has been supported by a combination of acquisitions, organic projects, and margin enhancement strategies. The acquisition of Independent Parts in Western Australia bolstered MaxiPARTS’ presence in a key region, contributing to revenue growth and operational resilience. Additionally, the Forch Australia division, which distributes workshop consumables and holds exclusive rights to FÖRCH products, delivered a 13% year-on-year revenue increase and improved EBITDA margins from 7% to 12%, highlighting the success of recent investments in sales force expansion and CRM upgrades.

MaxiPARTS also completed significant IT system integrations, including an ERP upgrade and CRM transition for Forch Australia, streamlining operations and supporting future scalability. The company’s new Kalgoorlie site, launched in July 2025, is expected to leverage strong customer relationships in Western Australia, further underpinning regional growth.

Capital Management and Shareholder Returns

MaxiPARTS demonstrated prudent capital management by extending its debt facilities to September 2028 with a lower fee structure and paying down $7 million of drawn debt during the year. The company remains a capital-light business, with total capital expenditure around $1 million, primarily invested in technology upgrades and inventory to support growth initiatives.

Shareholders will benefit from a fully franked final dividend of 3.12 cents per share, bringing the full-year dividend to 6.17 cents, a 20% increase over FY24. The Dividend Reinvestment Plan remains available, reflecting confidence in the company’s cash flow generation and future prospects.

Outlook, Cautious Optimism with Focus on Organic Growth

Looking ahead to FY26, MaxiPARTS anticipates continued market softness on the east coast but expects pockets of strength in Western Australia and mining logistics sectors. The company plans to maintain its focus on organic growth projects, margin improvement, and balance sheet flexibility. Expansion of the Forch Australia sales team and further growth in the Japanese product range are key priorities, alongside ongoing investments in people and systems to sustain year-on-year progress.

While competitive pricing pressures persist, MaxiPARTS’ strategic initiatives and disciplined execution position it well to navigate the evolving market landscape and deliver shareholder value.