Kelly Partners Group (KPG) H1 2025 earnings summary

Executive summary

• Revenue for 1H25 rose 22.8% year-over-year to $64.9m, driven by both organic growth (4.0%) and acquisitions (18.8%), with continued US expansion and a network of 35 offices and 104 partners across four countries.

• Underlying NPATA attributable to shareholders increased 12.0% to $4.9m, with free cash flow per share at 11.0c and EPS up 12.0%.

• Statutory NPAT rose 18.1% to $8.7m, and underlying EBITDA increased 11.2% to $20.4m, while EBITDA margin declined to 28.1% due to US integration.

• Dividend payments ceased in February 2024 to prioritize capital allocation for growth, with ongoing share buybacks totaling 100,000 shares in 1H25 and 597,181 since IPO.

• Significant global expansion, especially in the US, with new partnerships in Florida and North Carolina, and US revenue now representing up to 15.2% of group revenue.

Financial highlights

• Revenue for the half-year was $64.9m, up 22.8% from the prior year, mainly from acquisitions and organic growth.

• Underlying EBITDA (pre-AASB16) rose 12.5% to $17.4m–$18.2m; group operating EBITDA margin was 28.1%, down from 30.6% prior year.

• Underlying NPATA attributed to shareholders increased 12% to $4.9m; statutory NPAT (Group) increased 18.1% to $8.7m.

• Cash from operations increased 26.7% to $14.5m, and free cash flow to firm after debt reductions rose 18.5%.

• Cash conversion remained high at 103%, and gearing ratio was 1.49x of underlying EBITDA.

Outlook and guidance

• Focus remains on programmatic acquisitions, organic growth, and continued investment in digital infrastructure, people, and brand to support long-term global expansion.

• US listing process underway, with a 12-month illustrative timetable for SEC and ASX scheme processes.

• No dividends planned as capital is redirected to growth and acquisitions.

• Organic growth expected at 3%-5%, with a long-term average of 6% after adjusting for client rationalization.