McMillan Shakespeare Posts Record $107.9m UNPATA with Novated Lease and EV Growth

Record Profit Backed by Novated Lease and EV Momentum

McMillan Shakespeare Limited (ASX:MMS) has delivered a standout FY26 financial performance, posting an underlying net profit after tax and amortisation (UNPATA) of $107.9 million, up 13.8% on the prior year. This marks a new record for the salary packaging and novated leasing specialist, underpinned by a 6.8% rise in group revenue to $602.1 million and a 14.1% jump in EBITDA to $180.7 million.

The company’s operating margin expanded by 250 basis points to 41.5%, reflecting strong operating leverage from productivity gains and a digital-first approach. CEO Rob De Luca highlighted that “FY26 was a record year for MMS, with strong earnings growth, expanding margins and customer growth across every segment of the business.”

Group Remuneration Services Leads Growth with Novated Leases and EV Adoption

The Group Remuneration Services (GRS) segment, encompassing salary packaging and novated leasing, was a key growth driver. Novated leases under management rose 13.5% to 90,000, while novated lease sales increased 8.4%. Notably, battery electric vehicles (BEVs) accounted for 57% of all new novated leases, more than doubling from 31% in FY25, with BEV sales up 113%.

The company’s Oly brand, targeting the SME market, was a standout performer with novated sales growth of 77% and a 185% increase in new employer registrations. This expansion validates MMS’s strategy to broaden distribution and deepen market penetration beyond its traditional corporate base.

Onboard Finance receivables grew 16.6% to $587 million, supporting the strong revenue growth in GRS, which saw a 11.2% rise to $351 million. EBITDA in the segment surged 24.8% to $137.2 million, aided by productivity improvements and tight cost control, with operating expenses increasing just 1.4%.

Asset Management and Plan Support Services Show Steady Progress

The Asset Management Services (AMS) segment reported modest revenue growth of 1.3% to $188.4 million, with fleet units increasing 3.3% to 16,000. Despite slower fleet replacement cycles and a slight dip in operating income, AMS maintained a strong operating margin of 53.6% and improved productivity with leased assets per FTE up 17.2%.

Plan and Support Services (PSS), the Group’s NDIS plan management arm, grew revenue 5.9% to $59.8 million and customer numbers by 3% to 44,000 despite the removal of NDIA setup fees. EBITDA was slightly down 4.6% to $15.1 million due to ongoing investments in compliance and fraud detection capabilities.

Robust Balance Sheet and Shareholder Returns

MMS’s balance sheet remains solid with net assets rising to $126.4 million and a low debt to EBITDA ratio of 0.4x. Return on capital employed (ROCE) improved to 62.1%, demonstrating efficient capital utilisation. The Board declared a fully franked final dividend of 70 cents per share, bringing the full-year dividend to $1.32, representing a 6.6% yield. Additionally, an on-market share buy-back of up to $10 million was approved, signaling confidence in the company’s growth prospects.

Digital Innovation and Sustainability Initiatives

Customer engagement with MMS’s digital platforms, MyMaxxia, MyRemServ, and Oly, remained strong, with high app ratings and net promoter scores across segments. The company’s investments in automation, artificial intelligence, and self-service tools are credited with driving operational efficiencies and improving customer outcomes.

On the sustainability front, MMS reported its first year of climate reporting under AASB standards, achieving an upgraded MSCI ESG rating of “AAA.” The company has transitioned all its sites to renewable electricity and is progressing towards a target of 50% electric vehicles in its internal fleet by FY30, with 42% already achieved.

Outlook Supported by EV Trends and Policy Certainty

Looking ahead, MMS enters FY27 from a position of strength. The company expects continued momentum in novated lease sales, supported by an 8% sales increase in July 2026, certainty around the EV Fringe Benefits Tax exemption, and growing demand for salary packaging amid inflationary pressures. Remarketing income is anticipated to benefit from elevated demand for EVs, despite softer used internal combustion engine vehicle markets.

MMS remains well positioned as the second largest NDIS plan manager and continues to engage with government on reforms. The company plans to sustain productivity gains while selectively reinvesting in sales capability and customer value proposition enhancements, maintaining focus on its strategic priorities of customer experience, scalable solutions, and technology enablement.