Breville Group trading update – insights from the Annual General Meeting
Breville Group (ASX: BRG) delivered a concise trading update at its Annual General Meeting yesterday, focusing on the first half of financial year 2026 (1H26) to date. While the commentary was positive on several fronts, ongoing uncertainties remain in the U.S. market.
Overall, new product launches and new market expansions are tracking well, contributing to positive year-to-date (YTD) trends. However, management noted that the most critical trading months of the half are still ahead, tempering any immediate optimism.
According to the company, the premium consumer segment continues to demonstrate reasonable resilience, which is positive amid broader economic pressures.
The company’s initiative to diversify manufacturing is advancing as planned, and BRG remains on track to relocate 80 per cent of its 120V production outside China by the end of 1H26. Phase 1 of the process is focused on speed and quality assurance, while Phase 2 – set to commence in the second half (2H26) – will focus on optimising costs and locality. The company was at pains to emphasise product quality has been maintained throughout this transition.
BRG acknowledged the “dynamic backdrop” in the U.S., affirming its readiness to respond tactically to any shifts in trade policies and “rules”. This flexibility – remember the company heavily front-loaded U.S. deliveries ahead of Trump’s tariffs on China – highlights the company’s adaptability, especially in an uncertain, if not volatile, geopolitical landscape.
The update reinforces the company’s status as a high quality operator. Year-to-date commentary aligns with current consensus expectations of very low double-digit revenue growth for FY26. Of course, the numbers remain somewhat pliable, given visibility is limited until the peak trading period concludes.
Consensus forecasts for profit currently point to broadly flat earnings before interest and taxes (EBIT) compared to FY25, but there’s uncertainty around the impact of cost pressures from manufacturing diversification measures and market shifts. We also won’t have a good bead on the split between 1H26 and 2H26 until we get through the peak trading period and the company reports on the first half results at the half-year mark.
Overall, the manufacturing project’s smooth execution is a reassuring development, mitigating risks associated with supply chain dependencies. However, the absence of any detailed insights into costs and margins will leave analysts with questions. In this environment, it’s unrealistic to expect the stock to move materially away from the broader market in terms of importance. Nor is it reasonable to expect a catalyst before the half year results.
The next update will be the announcement of the half yearly results in February.
Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
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