McMillan Shakespeare novated lease portfolio reaches record 90,000 vehicles after 13.5% growth

Record novated lease book anchors FY26 result

McMillan Shakespeare has grown its novated lease portfolio to a record 90,000 vehicles, up 13.5% year on year, in results for the financial year ended 30 June 2026. Kapitales Research, reporting on the company's Preliminary Final Report released on 28 August 2026, says the growth came alongside a 7.1% rise in salary packaging customers to 402,000. The company's earnings call transcript, published by Reuters via Investing.com, records chief executive Rob De Luca telling investors that novated lease growth of 13.5% was underpinned by novated sales growth of 8.4% for the full year, accelerating to 19.5% half on half in the second half. ²¹

The broader group result was also a record. According to Kapitales Research's coverage of the FY26 report, revenue from continuing operations rose 6.8% to AU$602.1 million, statutory net profit after tax increased 11.4% to AU$106.7 million, and underlying NPATA reached a record AU$107.9 million, up 13.8%. The Reuters-published transcript quotes De Luca describing FY26 as "a year of strong organic growth, strategic execution, and a relentless focus on delivering excellent experiences for our customers as their trusted partner." ²¹³

Electric vehicle demand lifts Group Remuneration Services

The novated leasing result sits within McMillan Shakespeare's largest division, Group Remuneration Services. Kapitales Research reports that GRS revenue increased 11.2% to AU$351.0 million, with underlying EBITDA up 24.8% to AU$137.2 million, supported by higher novated lease activity, increased customer demand for battery electric vehicles and productivity gains. In the earnings call, De Luca is quoted citing the EV fringe benefits tax exemption, fuel-efficient vehicle demand and salary packaging demand tied to cost-of-living pressures as supports entering FY27. ²¹³

The same company figures show the novated leasing growth extended to smaller business customers. The transcript published by Reuters records Oly, MMS's SME novated offering, growing novated sales 77% in the period, with registered SME employers up 185% and employer-to-lease conversion improving by 23 percentage points. The company also noted distribution expansion through partnerships with SME-facing organisations including NAB. ¹³

Growth has come at a cost to per-vehicle income. Management said in the call that novated lease yield was down 3% year on year, which the company attributed to the prior-year surge in plug-in hybrids and competitive value proposition enhancements made to support growth. In the analyst question session reported by Reuters, management added that the mix shift toward lower-priced EVs and insurance changes had reduced second-half yields. ¹³

Onboard Finance, the division's receivables book, grew 16.6% to AU$587 million according to the company's results presentation quoted in the Reuters-published transcript. Management cautioned, however, that receivables growth is expected to moderate from the 16% recorded in FY26 to a forecast high-single-digit to low-double-digit rate, though the business should remain accretive in future years. ¹³

Dealer platform and digital investment cited as growth enablers

McMillan Shakespeare attributes part of its novated leasing momentum to dealer-facing technology. In the results presentation quoted by Reuters, De Luca said the company's integrated digital platform for dealers representing vehicle manufacturers cut the time from lead inquiry to settlement by about five days and lifted the number of dealers using the platform by 42% during the year. He said the company had continued to strengthen partnerships with leading global automotive brands as part of its first strategic priority on customer and partner experience. ¹³

Internally, the company reported productivity gains from automation and AI-enabled processing, including a 13% reduction in average call handling time and 94% of novated leasing claims now digitally processed, with an NPS of +50 for the segment. Kapitales Research notes management expects ongoing technology investment and scalable platforms to remain central to future expansion, with customers per FTE improving 17.5% in the novated leasing business. ¹²

Fleet management slows as customers hold vehicles longer

The group's fleet management arm, Asset Management Services, grew more modestly. Kapitales Research reports fleet units grew 3.3% to 16,000, while the company's presentation, quoted in the Reuters-published transcript, attributes the growth to 20 net new client wins and 30% growth in managed-only units. The same source notes revenue rose just 1.3% to AU$188.4 million. ²¹³

Management told investors that fleet customers are holding vehicles longer and fleet replacement cycles are slowing, with vehicle values normalising from elevated post-pandemic levels. The company's quoted presentation shows written-down value down 1%, operating income down 1.7% and end-of-contract unit sales down 9%, while EBITDA fell 4.8% to AU$27.7 million on one-off costs from business process outsourcing and a transition to a single retail yard. Management said first-half FY27 could see further downside on remarketing values as used-car prices keep easing, though the business remains profitable. ¹³

Momentum into FY27 and the market's reaction

Looking forward, management pointed to early FY27 momentum. According to the Reuters-published transcript, the company cited July FY27 novated sales growth of 8% and orders up 18% as signs of continued demand, though in the analyst session management said July's 8% pace looked more like a normalised rate after a volatile period shaped by policy uncertainty and fuel-market disruption. Kapitales Research reports management expects EV adoption, cost-of-living pressures and productivity initiatives to support demand through FY27, alongside cost risks including a 4.75% Fair Work Commission wage increase. ¹³²

Despite the record profit, the market reaction was negative. Reuters reported via Investing.com that shares fell 7.19% to $19.48 on results day, suggesting investors were focused on the outlook for key earnings drivers, including easing remarketing income and moderating Onboard Finance growth, rather than the FY26 result itself. The company declared a fully franked final dividend of 70 cents per share, taking the FY26 total distribution to 132 cents, with the final dividend paid on 25 September 2026, according to Kapitales Research. ³²