AUB Group Shares Climb 5% Despite Shareholder Revolt as Nearly Half of Votes Oppose Pay Report at AGM

SYDNEY — Shares of AUB Group Ltd. rose more than 5% on Thursday as the insurance broking group held its annual general meeting. At the meeting, nearly half of the votes cast opposed its executive pay report.

AUB shares closed up A$1.65, or 5.41%, at A$32.15. The stock traded between A$30.75 and A$32.18, with about 455,000 shares changing hands. AUB's market value stood at about A$4.2 billion.

The gain made AUB one of the top performers on the S&P/ASX 200 index, which closed 0.35% lower on Thursday.

First strike on pay

AUB received a "first strike" against its 2026 remuneration report at the meeting in Sydney.

The resolution to adopt the report passed narrowly, with 52.06% of votes in favor and 47.94% against. About 50.5 million votes were cast against the report, out of about 106.2 million votes in total.

Under Australia's corporations law, a company receives a "strike" when 25% or more of votes cast oppose its remuneration report. If a company receives two consecutive strikes, shareholders vote on whether to hold a meeting to re-elect the board.

The notice of meeting did not include a long-term incentive grant resolution, because a new incentive framework is under review. The board had said the existing return-on-invested-capital hurdle, introduced in 2023, could unintentionally discourage future acquisitions.

Shareholders approved all other resolutions. Gary Lennon was elected as a director with 97.66% of votes in favor. Resolutions on placement capacity, takeover provisions and financial assistance each passed with more than 99% support.

Strong results

AUB reported record underlying net profit after tax of A$224.6 million for fiscal 2026 in August, up 12.2% from a year earlier. Group EBIT margin rose 140 basis points to 36.1%.

The company has forecast fiscal 2027 underlying net profit of A$245 million to A$265 million, representing growth of 9.1% to 18%.

"AUB Group begins FY27 with greater scale, a stronger portfolio and clear opportunities to lift returns for shareholders," Chief Executive Michael Emmett said in August.

At the time, Emmett said the company would revise and clarify its medium-term margin targets for its new Australia and New Zealand reporting structure, likely at the AGM or with its February half-year results.

The company's current medium-term EBIT margin targets are 40% for Australian broking, 42% for New Zealand, 47% for agencies, 50% for BizCover and 32% for international.

About AUB

AUB is a network of insurance brokers and underwriting agencies, operating across about 579 locations. It primarily serves small and medium-sized businesses in Australia, New Zealand and internationally.

Despite Thursday's gain, AUB shares are down about 17% over the past year. The stock has traded as high as A$40.28 over the past 52 weeks.

The average analyst price target is about A$35.21, according to Yahoo Finance data.

This article is for informational purposes only and does not constitute investment advice.