Euroz Hartleys Group delivered a sharp FY26 earnings recovery as revenue rose 43.6% and net profit increased 62.4%, while its $145 million sale of Capital Markets to BMO moved towards completion. The transaction will leave the ASX-listed group focused on Private Wealth, with a strategic question hanging over how much earnings power survives the separation.
- Revenue rose 43.6% to $141.7 million
- Net profit increased 62.4% to $16.7 million
- Funds under management grew 16.1% to $5.17 billion
- $145 million Capital Markets sale to BMO approved by shareholders
- Fully franked dividend increased to 7.5 cents per share
Strong FY26 result arrives before the business is split
Euroz Hartleys Group Limited (ASX:EZL) enters its post-stockbroking era from a position of considerably stronger earnings than a year ago. Revenue climbed 43.6% to $141.7 million for the year ended 30 June 2026, while net profit attributable to members rose 62.4% to $16.7 million. Basic earnings per share increased from 6.54 cents to 10.74 cents.
The result was powered by the more cyclical parts of the business. Brokerage revenue rose 41.2% to $44.5 million, underwriting and placement fees increased 51.5% to $58.4 million, and corporate advisory revenue jumped 190.2% to $6.2 million. Euroz Hartleys acted as lead manager or co-manager on 87 equity capital markets transactions that raised $4.64 billion, compared with 74 transactions raising $1.64 billion in FY25.
BMO transaction sets the group’s next earnings test
Those figures describe a group that is still benefiting from a stronger capital-raising market, but the business that produced them is about to change materially. Euroz Hartleys entered into a binding agreement on 30 June 2026 to sell its Capital Markets business to BMO Financial Group for $145 million. Shareholders approved the transaction on 16 October, and completion is scheduled for early November, subject to the remaining customary conditions.
The deal was first framed as a refocusing on Private Wealth in the but the annual report now places the separation against a completed shareholder vote and a defined post-transaction structure. Following completion, Euroz Hartleys expects to operate as a standalone Private Wealth group under the Euroz Hartleys and Entrust Wealth Management brands, while a strategic alliance with BMO is intended to preserve the connection between the two businesses. The earlier $145 million BMO sale was presented as a transaction that would return proceeds to shareholders and retain that relationship.
Private Wealth provides the recurring revenue foundation
The continuing business was not merely a footnote to the Capital Markets performance. Wealth management fees rose 13.8% to $25.1 million, while funds under management increased 16.1% to $5.17 billion from $4.45 billion. Segment revenue from Private Wealth reached $71.3 million and generated $5.1 million in net profit after tax, up from $2.3 million in the prior year.
Management says its focus is to increase recurring revenue, grow the adviser network and invest in adviser platforms, technology and client service. That ambition matters because the group’s cash generation was less impressive than its accounting profit during FY26: operating cash flow was negative $953,000, compared with $39.2 million of inflows in FY25. The report attributes the movement largely to working-capital changes, including higher receivables and lower payables, rather than identifying a deterioration in the underlying profit result.
Shareholder returns rise while transaction tax looms
Euroz Hartleys declared a fully franked final dividend of 5 cents per share, taking the FY26 dividend to 7.5 cents, up from 5.5 cents in FY25. The group also returned $23.1 million of capital during the year and says total dividends and capital returned over its 26-year history will reach approximately $460 million after the transaction-related capital management program.
The sale proceeds will not flow through to shareholders in full. The annual report estimates corporate tax payable on the transaction at approximately $38.7 million. At 30 June, the group had $86.9 million in cash, financial assets and investments, no debt and net tangible assets of 38.2 cents per share, but the post-completion balance sheet and final distribution remain important pieces of the transaction’s investment case.
Leadership transition adds another layer of execution risk
The transaction also brings a significant change in personnel. Andrew McKenzie is moving from Executive Chairman to Non-Executive Director, Timothy Bunney is transitioning to Non-Executive Director status, and Alan Logan is taking over as CEO. Jay Hughes is due to become Non-Executive Chairman, with Andrew Fry and Michael Bartley joining as Executive Directors, while Robin Romero and Fiona Kalaf are departing the board. The new CEO and board reshuffle was announced ahead of the shareholder vote.
Euroz Hartleys describes its people and client relationships as the core of its goodwill. That claim is especially consequential when the group is selling the division that generated $67.5 million of segment revenue and $10.0 million of segment net profit after tax in FY26. The strategic alliance with BMO is designed to soften that break, but its commercial value will only become clearer once the Capital Markets team has moved across and the standalone wealth business reports without the benefit of those transaction revenues.
Bottom Line?
The immediate catalyst is completion of the BMO sale, followed by evidence that Private Wealth can convert $5.17 billion of FUM into steadily growing recurring earnings after the higher-margin Capital Markets contribution leaves the group.
Questions in the middle?
- How much of the $145 million sale proceeds will ultimately be distributed after the estimated $38.7 million corporate tax bill and transaction costs?
- Can Private Wealth sustain organic FUM growth and improve recurring revenue quickly enough to offset the loss of Capital Markets earnings?
- Will the strategic alliance with BMO preserve meaningful client and distribution benefits once the two businesses have separate ownership and leadership?