Bapcor (BAP) Trading Update summary

Trading performance and operational changes

• May and June trading months were disappointing, especially in the trade segment, due to disruptions from over 45 site closures, consolidations, and integration challenges in the electrical group.

• Retail sales were impacted by a shift from all-store to category-specific promotions, which improved gross margin but reduced sales.

• New Zealand operations remain challenged by economic conditions, with little improvement at the consumer level.

• The company remains committed to opening 12 new trade stores in FY26, with no current plans for new retail stores.

• Specialist Wholesale segment and Networks segment faced disruption from business consolidations and restructuring.

Financial performance and trading update

• Preliminary pro-forma NPAT for FY25 expected at $81-82M; statutory NPAT at $31-34M after significant items.

• Total FY25 revenue declined 1.4% to $1,944.3M, with Trade segment up 1.4% but other segments down.

• Second half trading was below expectations, especially in May and June, due to weak sales and challenging retail conditions.

Balance sheet review and significant items

• A comprehensive balance sheet review led to the recognition of significant items totaling $48–$50 million for the full year, with $43.3–$45.3 million impacting the second half.

• Significant items include $6.9M asset write-offs, $6.4M uncollectable receivables, and $10.8M inventory valuation adjustments.

• Additional restatements of $24 million post-tax, spanning FY21–FY24, relate to intercompany transactions and a change in inventory valuation policy.

• FY24 comparatives to be restated for intercompany transactions and inventory costing policy changes.

• These adjustments are aimed at simplifying operations and aligning accounting practices across the business.