Prime Financial Group (ASX:PFG) management highlighted a “strong first half” for FY26, pointing to a combination of revenue growth, earnings expansion and improved operating cash flow as drivers behind an increased interim dividend and continued confidence in full-year guidance.
Speaking on the company’s FY26 first-half results webinar, Managing Director and Chairman Simon Madder said momentum had carried over from what he described as a strong FY25, with progress continuing as the company builds its “whole of client solution platform” across advice, capital and asset management. Madder also said the company is seeing a stronger M&A environment, with a growing pipeline of opportunities, while emphasizing Prime’s selective approach and the importance of balancing organic and inorganic growth.
Financial results: revenue up 31% and margin expansion
Underlying EBITDA to members was AUD 6.5 million, up 60% over the prior corresponding period, while underlying EBITDA margin improved by 400 basis points to 22%.
Papworth attributed the margin uplift to:
- An increase in revenue per full-time equivalent (FTE) to AUD 249 thousand at the end of the half, compared with AUD 220 thousand in FY25 (a 13% increase).
- Lower labor costs as a percentage of revenue.
On a reported basis, Papworth noted a bridge between reported EBITDA and underlying EBITDA reflecting one-off costs largely tied to acquisition due diligence. Those one-off costs were AUD 200 thousand in the half, compared with AUD 600 thousand in the prior half.
Earnings, cash flow, and dividend
Net operating profit after tax (NOPAT) to members increased 182% to AUD 3.1 million. The company also introduced a measure it described as “core operating profitability,” reporting NPATA of AUD 3.6 million, up 112% year-over-year.
Operating cash flow rose to AUD 3.2 million for the half, which Papworth said was almost triple the prior corresponding period, driven by stronger earnings and working capital management. Prime’s debt to underlying EBITDA ratio improved to 1.2x at December, down from 1.3x in June, which Papworth attributed to earnings growth.
Reported EPS increased to AUD 0.012 per share, and the company declared an interim dividend of AUD 0.008 per share, up 4% and “in line with guidance.” Papworth said the interim dividend reflected a 67% earnings payout ratio, consistent with prior guidance.
During Q&A, management also confirmed the dividend reinvestment plan (DRP) would apply to the interim dividend, with a 2.5% discount to VWAP at the time.
Segment performance: wealth leads; business segment shifts toward recurring income
Papworth said revenue growth was driven by both wealth and business segments, with the wealth segment the largest contributor. Wealth segment revenue increased 57% year-on-year, which Papworth said included the impact of Lincoln Indicators (acquired in May 2025) as well as the divestment of non-core assets.
The business segment increased 3%, which Papworth said was in line with expectations as Prime continues to reduce transactional revenue and increase recurring income. She said transactional revenue within the business segment declined 25% during the period, while recurring income grew 18%, largely from the accounting and business advisory division.
At the group level, Papworth said organic growth from continuing contracts was up 6% year-on-year, within the company’s 5% to 10% target range. She added Prime intends to focus on lifting organic growth further over time.
Recurring income increased to 78%, up 11% from the prior period. Madder later said the company wants to move recurring income from 70% (historically) toward 85% to improve predictability and cash generation.
M&A pipeline, integration, and funding capacity
Madder said M&A will remain a feature of Prime’s growth strategy and described a growing market for potential acquisitions. In response to a question about confidence in reaching the company’s longer-term revenue ambition (AUD 100 million by FY28–FY30), Madder said Prime’s pipeline of prospective businesses represented about AUD 150 million of potential revenue and had doubled over the past six months. He emphasized that Prime does not pursue every opportunity and often engages with potential partners for extended periods, citing that discussions can last around 18 months before a transaction may or may not occur.
Operationally, Madder said Lincoln Indicators has now been “completely integrated” into Prime’s core operations, bringing an opportunity to provide services to approximately 3,300 clients. He also said the company brought in additional teams across wealth and business, contributing AUD 1.7 million in annualized revenue, which he said is integrating well.
On funding, Madder said Prime slightly upsized its Westpac facility by “a couple of million dollars.” Papworth said the company has access to AUD 43 million of funding via Westpac to support its growth strategy. Madder also reiterated that Prime typically issues 20% to 50% of acquisition consideration in shares, but said it has been closer to 20% recently, with the remainder generally paid in cash over a three-year earn-out period.
When asked about potential capital raisings, Madder said none were anticipated “at the moment,” citing available capacity in the Westpac facility and an internal preference to keep debt to underlying EBITDA around 1.0x to 1.5x (noting it was 1.2x at the end of the half). He added that a more material acquisition could change the calculus, but said current plans do not require raising capital.
Technology and outlook: Salesforce CRM rollout and guidance maintained
Madder said Prime is investing in education, leadership training and “increasingly, AI,” while emphasizing the business would remain people-led. On technology, he said Prime will commence phase one of a group-wide CRM rollout in May, replacing previously “isolated” CRM systems. In Q&A, management said it selected Salesforce—specifically a Financial Services Cloud instance—after evaluating alternatives including Dynamics, with an emphasis on using “out of the box” best practices and avoiding heavy customization.
Looking ahead, Madder said Prime is maintaining the FY26 guidance provided at the AGM:
- Revenue at least 15% to 20% higher than the prior year
- Underlying EBITDA up 20% to 25%
- Operating cash flow at least 125% to 150% improved on the prior year
- Dividends up 3% to 5% (with the interim at the midpoint of the range)
Madder also discussed seasonality, noting the second half has historically been stronger, but said the company is encouraged by results that suggest the gap between first-half and second-half performance may be narrowing.
About Prime Financial Group (ASX:PFG)
Prime Financial Group Limited provides wealth management, self-managed superannuation fund (SMSF), accounting and business, capital, and corporate advisory services in Australia. The company offers accounting and business advisory services, such as accounting and tax compliance, business growth advisory and strategy, outsourced CFO and accounting, grants and R&D tax incentives, and innovation and commercialization advice; and capital and corporate advisory services comprising merger and acquisition transactions, capital raising, debt equity markets, and corporate development.
