Bapcor (BAP) H2 2024 earnings summary

Executive summary

• FY 2024 saw record revenue of AUD 2.04 billion, up 0.8% year-over-year, with growth in Trade and Specialist Wholesale partly offset by Retail declines.

• Statutory NPAT fell to a loss of AUD 158.3 million, mainly due to AUD 253.1 million in post-tax impairments and write-downs in the Retail segment.

• Pro-forma NPAT dropped 24.3% to AUD 94.8 million, in line with guidance.

• Cost of doing business increased, driven by higher employee, IT, and occupancy costs.

• Significant management and board changes occurred, including the appointment of Angus McKay as Executive Chair & CEO and George Saoud as CFO.

Financial highlights

• Group revenue grew 0.8% year-over-year to AUD 2.04 billion, driven by Trade and Specialist Wholesale, offset by Retail decline; New Zealand was flat.

• Gross margin was 46.2%, down 45 bps; gross margin dollars fell 0.2% to AUD 942 million.

• Pro-forma NPAT was AUD 94.8 million, down 24.3% year-over-year; statutory NPAT loss of AUD 158.3 million due to significant non-cash items.

• Operating cash flow was AUD 206.7 million, down from AUD 320.7 million in FY 2023, mainly due to inventory build-up and higher CODB.

• Final dividend declared at AUD 0.055 per share, total FY dividend AUD 0.15 per share (54% payout ratio).

Outlook and guidance

• FY 2025 started with revenue up 7.7% in the first five weeks (1% like-for-like), with improvements across all segments.

• Expected cost savings of AUD 20-30 million in FY 2025, skewed to the second half, from headcount reduction and DC rationalization.

• Focus on simplification, operational efficiency, disciplined capital allocation, and growth in Trade and IT infrastructure.