Kelly Partners Group Holdings Limited

Kelly Partners reported revenue of AUD 159.2 million, up 18.2% year over year, driven by 2.9% organic growth and 15.3% acquired growth. Underlying NPATA to shareholders was AUD 10.8 million, up 18.9%, while NPATA was AUD 8.4 million, up 18%; underlying EBITDA was AUD 17.9 million. Operating EBITDA margins were 28.4% for operating businesses and 31.9% for Australian businesses. Cash from operations was AUD 32.4 million, up 30.1%, and free cash flow to the consolidated group was AUD 18.4 million, up 50.5%. The balance sheet showed leverage of 1.52x EBITDA, cash and headroom of AUD 18.6 million, total assets of AUD 229.9 million, and lockup days of 52.8 days. Management did not provide formal next-quarter or full-year numeric guidance, but said the business is positioned for aggressive global growth, with plans to pursue international listing options, long-dated debt funding, and a dual-class structure.

Brett Kelly sounded highly upbeat and strategic, framing the quarter as part of a 20-year track record of compounding, with the business now at about AUD 159 million of revenue and an estimated run-rate of AUD 164 million. He said the company is moving to a global footing, with 24/7 operations, a new Dublin office, more U.S. expansion, and a long-term goal to scale the model internationally. He also said AI is already creating benefits, but declined to share specifics, calling it a major opportunity.

Kenneth Ko focused on the financial mechanics: revenue of AUD 159.2 million, underlying NPATA to shareholders of AUD 10.8 million, EBITDA margins of 28.4% in operating businesses, and Australian margins of 31.9%. He highlighted strong cash conversion, with AUD 32.4 million of operating cash flow and AUD 18.4 million of free cash flow after scheduled debt reductions. He also clarified the debt stack: AUD 74.7 million of total drawn debt, of which AUD 28.5 million sits at the parent and AUD 46.3 million at operating businesses, plus AUD 18.6 million of cash and headroom.

Analysts asked about customer concentration risk from SME clients being acquired, the pace of international listing and debenture funding plans, the Cypriot deal that fell through, rising group investment to 3.1% of revenue, the fall in Brett Kelly’s shareholding to 31%, acquisition pace, dividends, U.S. profitability, and AI benefits. Management said client-acquisition losses are only a marginal long-term risk; the Cyprus deal ended with no break fee after the seller demanded more money; and dividend reinstatement is not planned while returns remain well above cost of capital. On AI, Brett said the company is already seeing benefits but will not disclose the methods, and on U.S. margins he said profitability is still maturing and should improve as new offices and relationships develop.