Bapcor’s FY25 NPAT Falls to $31-34M After $45M in Write-Offs

Trading Performance and Market Challenges

Bapcor Limited, a leading automotive parts and services distributor, has revealed a mixed FY25 trading update with a pro-forma net profit after tax (NPAT) of $81-82 million, but a significantly lower statutory NPAT of $31-34 million after accounting for substantial non-cash and one-off charges. The company’s second half performance fell short of expectations, primarily due to disappointing sales in May and June, the two largest trading months.

The Trade segment showed resilience with modest revenue growth compared to the prior half, but the Specialist Wholesale segment was notably disrupted by consolidation efforts. Integration of three businesses into the Auto Electrical Group led to branch closures, distribution centre consolidations, and headcount reductions, which unsettled trading. Meanwhile, the Retail segment faced a challenging environment marked by reduced discretionary spending, intensified competition, and altered promotional strategies. New Zealand operations also struggled amid tough economic conditions and heightened competition.

Balance Sheet Review and Significant Charges

Following the year-end, Bapcor conducted a comprehensive review of its balance sheet, uncovering $43.3-45.3 million in significant post-tax charges in the second half alone, adding to $4.7 million from the first half. These charges, mostly non-cash, include asset write-offs related to ERP systems and brand names, uncollectable receivables, provisions for commercial disputes, inventory valuation reductions, and estimated impairments at store level.

Notably, the company also identified issues with supplier disputes and receivables no longer deemed collectible, which contributed to the financial adjustments. The review has led to restatements in FY24 comparatives, including changes in accounting for intercompany transactions and inventory costing, with an estimated $24 million post-tax reduction to opening retained earnings for FY25.

Leadership Changes and Strategic Outlook

In a significant governance development, three directors, Mark Bernhard, Brad Soller, and James Todd, resigned from the board, prompting an accelerated board refresh process. Executive Chair and CEO Angus McKay acknowledged the disruptions caused by the simplification and consolidation efforts but expressed confidence in the company’s refreshed leadership and strategy to return Bapcor to sustainable growth.

McKay emphasized ongoing investments in IT systems, supply chain transitions, and marketing as foundational to the updated strategy. The company plans to continue simplifying operations and improving customer outcomes in the coming year, despite the current headwinds.

Bapcor is scheduled to release its full audited FY25 financial results on 28 August 2025, which will provide further clarity on the impact of these adjustments and the company’s path forward.