Bapcor has warned of weak profit and balance sheet for the fiscal year, along with some changes to its board of directors, in its latest trading update.
The automotive parts group expects an unaudited pro-forma net profit after tax of A$81-82 million for the 12 months to June 30. Total revenue was down 1.4 per cent to $1.97 billion during the period.
Management noted that results in the second half were below expectations, especially in May and June.
They cited the continued challenging retail environment, significant disruption in the specialist wholesale segment due to consolidation activities, a more competitive landscape in New Zealand, and certain supplier disputes.
In addition, the company has conducted a comprehensive review of its balance sheet and identified $48-$50 million in unaudited post-tax significant items for the year. These items include asset write-offs, uncollectable receivables, changes in accounting estimates, inventory valuation and impairment charges, among others.
As a result, FY25 statutory net profit after tax is expected to be $31-34 million.
“Significant work has been undertaken during the year to simplify the business, which has disrupted trading,” said executive chair and CEO Angus McKay. “We have closed or moved more than 45 sites and consolidated multiple ERPs.”
“These changes were disruptive but necessary as we strive to simplify operations to set us up for the future,” he added.
Following the close of trading on Tuesday, Mark Bernhard, Brad Soller and James Todd tendered their resignation as directors of the company.
According to the Australian Financial Review, Bapcor shares tumbled 28 per cent in early trading on the ASX to $3.69, well below the Bain Capital proposal last year at $5.40 per share. This means the company has shed nearly $500 million in market capitalisation.
Bapcor operates 1100 retail and trade outlets under the Autobarn, Autopro, Burson and Midas brands. It also runs a trade segment which sells to mechanics, a wholesale business, and auto service centres.
The company will release its full-year financial results on August 28.
