Kelly Partners Group Holdings boosted FY26 revenue by 18.2% to $159.2 million, underpinned by six acquisitions including a key US CPA firm. Underlying NPATA rose 18.9% to $10.8 million, while the group deepened its global footprint across five countries.
- FY26 revenue up 18.2% to $159.2 million
- Underlying NPATA increased 18.9% to $10.8 million
- Six acquisitions completed, including US and Philippines expansions
- US revenue now ~15% of group total
- Digital tools and partner model drive growth
Strong Growth Fueled by Strategic Acquisitions
Kelly Partners Group Holdings (ASX:KPG) reported a solid 18.2% jump in revenue to $159.2 million for FY26, with underlying net profit after tax before amortisation (NPATA) rising nearly 19% to $10.8 million. The growth story is driven heavily by six acquisitions completed during the year, collectively contributing up to $22.2 million in annualised revenue. Notably, the addition of a CPA firm in Mission Viejo, California, has bolstered the US presence, now accounting for approximately 15% of group revenue, or around $25 million.
The acquisitions have helped Kelly Partners extend its global footprint to five countries, including Australia, Hong Kong, USA, Ireland, and the Philippines. The group's international expansion aligns with its mission to be Australia's global accounting firm for private business owners, targeting markets with significant Australian expatriate communities.
Operational Scale and Partner Model Drive Momentum
The group now operates 43 offices worldwide and employs 711 team members, including 105 partners. The Partner-Owner-Driver® model continues to underpin its acquisition strategy and integration approach, with six partnerships completed in FY26. This structure aims to attract and retain senior practitioners by facilitating succession and permanent partnerships rather than transactional sales.
Kelly Partners services roughly 10% of McDonald's franchisees in Australia and 8% in the US, reflecting a niche focus on franchise clients. The group has also invested in digital transformation, rolling out Microsoft 365 Copilot to improve productivity and launching a mobile app for McDonald's Owner-Operator clients, enhancing engagement and service accessibility.
Financial Metrics and Capital Management
Underlying EBITDA before lease accounting standards increased 16.8% to $40.2 million, with operating business margins steady at 28.4%. Cash flow from operations surged 30% to $32.4 million, underpinning a strong cash conversion ratio of 104.9%. Net debt rose 21% to $70.7 million due to acquisition financing and partner buy-ins, nudging the gearing ratio to 1.52 times underlying EBITDA.
Statutory net profit attributable to shareholders was relatively flat, edging up 3.5% to $3.53 million, reflecting amortisation and acquisition-related costs. No dividends were declared during FY26, consistent with the group’s reinvestment focus. Since its 2017 IPO, Kelly Partners has delivered a total shareholder return of approximately 319%, driven by share price appreciation and dividends paid up to early 2024.
CEO Highlights Growth Ambitions and Market Positioning
Founder and CEO Brett Kelly emphasised the group's commitment to investing in people, technology, and brand to build a differentiated global accounting firm. He highlighted the importance of integrating acquisitions effectively and maintaining proprietary insights as key to sustaining competitive advantage amid evolving AI opportunities.
Kelly Partners aims to deepen its presence in the US and UK markets, capitalising on Australia’s largest expat communities. The group’s positioning as a challenger brand has been reinforced by recent brand studies and its ranking at number 17 in the Australian Financial Review's Top 100 Accounting Firms.
Bottom Line?
Kelly Partners’ FY26 results reflect a well-executed acquisition strategy and global expansion, but rising debt and integration challenges warrant close monitoring.
Questions in the middle?
- How will Kelly Partners manage integration risks across its increasingly international portfolio?
- Can the group sustain organic growth alongside acquisition-driven expansion?
- What impact will ongoing investments in digital tools have on operational efficiency and client retention?