ARB Corporation’s FY26 profit fell 5.2% as weaker Australian aftermarket and OEM sales outweighed modest export growth. The 4x4 accessories maker is relying on improved vehicle supply, US expansion and new product programs to rebuild momentum in FY27.
- FY26 revenue fell 3.8% to A$702.0 million
- Profit after tax declined 5.2% to A$92.4 million
- Fully franked ordinary dividends held at 69 cents per share
- OEM sales dropped 27% amid vehicle supply constraints
- Q1 FY27 core vehicle platforms and the broader 4x4 market fell 16%
Vehicle supply disruption weighs on ARB’s FY26 result
ARB Corporation Limited (ASX:ARB) entered its FY26 annual meeting with a familiar problem made sharper: sales revenue fell 3.8% to A$702.0 million and profit after tax declined 5.2% to A$92.4 million. The company held fully franked ordinary dividends at 69 cents per share, but the underlying operating picture remained uneven, with the sharpest pressure concentrated in original equipment manufacturing and parts of the Australian market.
The result revisits the numbers outlined in ARB’s FY26 results announcement, where export growth helped offset weaker domestic trading. Export sales increased 0.5% to A$268.4 million and represented 38.2% of group revenue, while Australian aftermarket sales fell 3.3%. OEM sales were the major drag, dropping 27% to A$43.4 million and shrinking to 6.2% of total FY26 sales.
OEM decline tied to vehicle program timing and supply
ARB attributed the OEM decline to a lull between major vehicle programs and constrained supply of key vehicles, rather than a change in its competitive position. The presentation said a partial recovery emerged in the second half, with Toyota forecasting materially improved supply in the first half of FY2027 for models important to ARB’s OEM business.
That recovery is not yet visible in the early FY27 vehicle data. Sales of ARB’s core vehicle platforms, and the overall Australian 4x4 market, were down 16% in the first quarter compared with the same period a year earlier. ARB said more than half of the decline related to known Ford and Toyota supply issues, including a Ranger recall and a stop-sale affecting selected HiLux variants. Those issues are expected to be resolved, according to the presentation, but the timing remains important for an accessories business tied to new vehicle volumes.
US expansion and new OEM contracts provide longer-cycle growth
ARB’s international business offered a more constructive counterweight. The company said ARB USA delivered double-digit growth in FY26, despite economic and tariff headwinds, with sales through wholesale, 4 Wheel Parts, Off Road Warehouse and other channels. Asia was also a strong contributor, partly offsetting declines in the United Kingdom, Middle East and New Zealand.
The company has also secured contracts for two future platforms with new US OEMs. ARB said new projects typically require two to four years of development, making the contracts a longer-term pipeline item rather than an immediate answer to the FY26 shortfall. The earlier US export growth update had already identified the United States as a key source of growth while Australian OEM sales weakened.
Cash supports stores, engineering and product launches
ARB finished FY26 with A$47.9 million of net cash and no debt, despite paying A$83.6 million in cash dividends and investing A$36.6 million in property, plant and equipment. The company is directing capital towards manufacturing, engineering and its specialist retail network, including a new fleet fitment centre in Auburn and further company-owned and independent stores.
Its FY27 initiatives include a Preferred Partner Program for regional 4x4 specialists, a rollout pipeline targeting 22 partners by the end of FY27, new e-commerce capabilities and product launches across suspension, storage, recovery and touring. The near-term test is whether supply normalisation can lift vehicle-linked demand before those newer initiatives and longer-cycle OEM programs become material contributors.
Bottom Line?
ARB has balance-sheet capacity and several growth avenues, but FY27 still depends heavily on Ford and Toyota supply recovery translating into vehicle and accessory sales.
Questions in the middle?
- How quickly will Ford and Toyota supply issues unwind, and when will that appear in ARB’s Australian aftermarket sales?
- Can the new US OEM contracts progress from development into meaningful revenue within the stated two-to-four-year cycle?
- Will US growth and new store initiatives offset continued weakness in Australian vehicle volumes and OEM timing?