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In The Spotlight: AMA Group Ltd (ASX: AMA)
Key Takeaways
- AMA Group has undergone a significant strategic reset under CEO Mathew Cooper, refocusing on its core collision repair businesses.
- A simplified, portfolio-based operating model has replaced a more complex corporate structure.
- Balance sheet risk has been materially reduced following a $125 million capital raising.
- Board and management changes have strengthened governance and industry alignment.
- The company is now targeting disciplined, profitable growth rather than expansion for expansion’s sake.
Leadership Reset and Strategic Refocus at AMA Group
Mathew Cooper joined the AMA Group in September 2021 with an impressive resume.
He’d spent the previous eight years at major automotive retailing group Bapcor after working in executive roles at the likes of Amcor, General Motors, Metcash and Deloitte.
What he found at AMA proved to be a far cry from what he signed up for.
“When I took on the Chief Operating Officer role at AMA, it was always as a transition to the CEO role. It is very fair to say that the glossy brochure that was presented to me at the time of my recruitment was not exactly what I found,” he says with a wry smile.
“It has certainly been a very challenging three years since.”
But since Cooper was elevated to the role of CEO of the ASX-listed smash repairer at the end of 2023, he has been refocusing the group on what it does best, operating as a pure collision repair portfolio business with associated services.
Portfolio-Based Operating Model and Business Simplification
Under the new strategy, each business unit - AMA Collision, Capital SMART, Specialist Businesses and Wales - operates with its own brand and offer. The ACM Parts business, now deemed non-core, has been put up for sale.
“We have moved to reduce the corporate nature of the organisation and simplified it into a portfolio-based approach. You get a greater cost culture in that and eliminate the corporate waste,” Cooper says.
The strategy has been endorsed by a new, leaner board - taking reduced fees - which is determined to align itself with the interests of AMA’s shareholders following a boardroom restructure engineered by Alex Waislitz’s Thorney Investment Group, owner of 11.53 per cent of AMA.
Importantly the new board boasts real knowledge of AMA and the smash repair industry.
Capital Management and Balance Sheet Repair
AMA recently completed a fully underwritten capital raising of $125 million, cornerstoned by Thorney, its third raise since 2021.
$50 million has been used to repay existing senior bank debt, while an additional $50 million is now held in a locked account to settle expected redemptions on a convertible note put option, expected in March 2025.
“Thorney have been really supportive of this business for a long time and they backed that up through their investment in the equity raise. They support the management team and the board in terms of its direction,” Cooper says.
"They initiated action to overhaul the board because they believed there was a better alternative. We have now dealt with the debt overhang, got the balance sheet deleveraged and they are letting us get on with taking on the growth opportunity for this business.”
Board Renewal and Shareholder Alignment
The restructure coincided with the return to the boardroom of one of AMA’s foundation shareholders, Ray Smith-Roberts, who rejoined as a director in March. He was previously an executive director of AMA from February 2014 to November 2019.
“For me it has been a long journey. I was part of the team of people that founded AMA.
I was led to believe there was all this magic in public companies. I soon learned that wasn’t true. You just had to work hard and focus on the things that needed to happen,” Smith-Roberts says.
“I exited the business in 2019 when I felt it had lost its way, and now I have come back because I believe we are unified again. I see the opportunity. I see a management team not being pulled from pillar to post on shit that doesn’t matter.”
Like Cooper, he welcomes the support of Thorney.
“They aren’t people you want to make too many mistakes with because they don’t take second chances,” he says.
Governance, Culture and Leadership Alignment
The boardroom changes also saw AMA board member and insurance industry leader, Brian Austin, elevated to the chairman role.
“I have worked with Brian at a board level for a long time. He is not focussed on box ticking. He knows we must be compliant and govern the company properly but ultimately he knows there is much more to growing the business and making it more profitable,” Smith-Roberts says.
Mathew Cooper says he and Austin thus far talk only “as we need to”.
“It is not like we check in every week in a structured manner. It is a more fluid conversation. As a CEO I like that,” he says.
The AMA businesses now share a common strategic framework and values-based approach to operating.
The overarching value is “Together we do it right”.
Cooper says the firm is also being run according to four core principles:
- We care about each other
- We deliver exceptional customer service
- We target profitable growth
- We want to be even better tomorrow
Investment in Growth, People and Productivity
While Cooper says there remains opportunities to cut costs across AMA, he stresses the firm cannot “save itself to success.”
“It has to invest to be more productive, to lean into relationships with insurers, and it needs an absolute focus on commercial pricing with those insurers,” he says.
Insurance companies rely on AMA doing a great job as it protects their brand and their customers’ experiences.
“Our company operates in an environment predominantly supporting our Insurance Company customers for the benefit of providing a repair solution for their customers,” says Brian Austin.
AMA is currently looking to hire 150 workers, including offshore recruitment, and plans to open 3–5 greenfields sites annually. Acquisitions, particularly in regional hubs, are also on the agenda.
For investors, execution risk and growth discipline are key factors when assessing listed industrial companies.
Resilience, Culture and the Path Forward
While the past three years have been challenging, Cooper says adversity has strengthened the business.
“You get more resilient as you address those challenges,” he says.
“Humility is a very important trait in business. It will hold us in good stead going forward.”
About the Company
AMA Group Ltd (ASX: AMA)
AMA Group Ltd operates vehicle collision repair facilities across Australia and New Zealand. It operates through Vehicle Collision Repairs and Wales segments and provides rapid car repairs, commercial vehicle repairs, ADAS calibration services and mechanical collision repair services.
Market Capitalisation: $248,694,967
Share Price: $0.052
Historical Dividend Yield: 0%
Board & Management
- Brian Austin, Chair
- Joanne Dawson, Non-Executive Director
- David Goldstein, Non-Executive Director
- Ray Smith-Roberts, Non-Executive Director
- Mathew Cooper, Group Chief Executive
Financials as of COB 26.8.24
Company turnarounds require more than headlines, they require disciplined analysis. Morgans provides equity research, portfolio construction and investment advice to help investors assess opportunities across the ASX.
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FAQs
What does AMA Group do?
AMA Group operates vehicle collision repair businesses across Australia and New Zealand, servicing insurers and customers through multiple specialist brands.
Why did AMA raise capital in 2024?
The capital raising was used to reduce debt, strengthen the balance sheet and support future growth initiatives.
What changes has the new management team made?
AMA has simplified its structure, refocused on core operations, reduced corporate overheads and aligned management with shareholder interests.
Is AMA Group considered a turnaround investment?
Yes. AMA is in a turnaround phase, with a renewed focus on governance, profitability and disciplined growth.
What risks should investors consider?
Key risks include execution risk, labour availability, insurer pricing pressure and broader economic conditions.
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