Bapcor (BAP) H2 2024 earnings summary

Executive summary

• FY 2024 results were challenging, with pro-forma NPAT at AUD 94.8 million and group revenue up 0.8% to AUD 2.04 billion, but a statutory loss of AUD 158.3 million due to significant non-cash items and impairments.

• Underperformance was attributed to slow benefit realization from integration and investment programs, with Retail and Wholesale segments facing headwinds and higher corporate costs.

• The business is shifting focus to simplification, restructuring, and rationalization to drive value and efficiency, with management strengthened by new CEO and CFO appointments.

• Trade, specialist networks, and New Zealand segments grew earnings, while retail and wholesale underperformed.

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

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.

• Pro-forma EBIT was AUD 174.9 million, down 14.4% year-over-year.

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.

• Continued focus on simplification, operational efficiency, and disciplined capital allocation.

• Focus on core business, network expansion in Trade, and exit of non-core businesses.