Bapcor Limited (ASX: BAP) revises its 1H26 guidance with a projected statutory NPAT loss of AU$8 million to AU$5 million.
Revenue decline noted in tools and equipment within the Trade segment, despite growth in parts revenue.
One-off items, including a AU$15 million pre-tax review of the tools and equipment business, contribute to the projected loss.
Retail segment performance remains strong with 1.3% growth driven by Black Friday sales.
FY26 statutory NPAT now expected to range between AU$31 million to AU$36 million, with underlying NPAT of AU$44 million to AU$49 million.
Ongoing dialogue with lenders to secure a more favourable leverage covenant for FY26.
Restructuring costs remain consistent at AU$4 million pre-tax.
Weaker Trading in October and November Affects First Half Performance
Bapcor Limited has announced an updated 1H26 guidance in response to weaker-than-expected trading results in October and November, primarily within the Trade segment. Despite growth in parts revenue, tools and equipment sales have declined. To regain market share, Bapcor is investing in pricing adjustments, which have impacted margins in the short term but are expected to drive future growth.
As a result, the Company forecasts a statutory NPAT loss for 1H26, ranging between AU$8 million and AU$5 million, including approximately AU$19 million in one-off items, such as the AU$15 million pre-tax impact from the previously announced review of its tools and equipment business. These adjustments are expected to be non-recurring.
Despite the downturn in the Trade segment, Bapcor's Retail segment performed well during October and November, benefiting from strong Black Friday sales, which led to a 1.3% revenue increase compared to the prior corresponding period.
For the full year, Bapcor revised its FY26 statutory NPAT guidance to AU$31 million to AU$36 million, with underlying NPAT now expected to fall between AU$44 million to AU$49 million. This reflects expected improvements in the second half, driven by operational adjustments, pricing realignment, and savings initiatives.
Operational Adjustments and Lender Dialogue
Bapcor continues to work closely with its lenders to secure an adjusted leverage covenant for FY26, enabling the Company to navigate the challenges presented by the weaker first half. Bapcor continues engaging in discussions and is focused on nurturing strong relationships with its financial partners.
The Company also noted that restructuring costs of AU$4 million pre-tax are in line with prior announcements and should not materially impact the overall results for FY26.
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Bapcor Faces Tougher First Half, Revises FY26 Guidance Amid Weaker Trade Performance
Highlights
Weaker Trading in October and November Affects First Half Performance
Bapcor Limited has announced an updated 1H26 guidance in response to weaker-than-expected trading results in October and November, primarily within the Trade segment. Despite growth in parts revenue, tools and equipment sales have declined. To regain market share, Bapcor is investing in pricing adjustments, which have impacted margins in the short term but are expected to drive future growth.
As a result, the Company forecasts a statutory NPAT loss for 1H26, ranging between AU$8 million and AU$5 million, including approximately AU$19 million in one-off items, such as the AU$15 million pre-tax impact from the previously announced review of its tools and equipment business. These adjustments are expected to be non-recurring.
Retail Segment Shows Resilience; Overall FY26 Guidance Adjusted
Despite the downturn in the Trade segment, Bapcor's Retail segment performed well during October and November, benefiting from strong Black Friday sales, which led to a 1.3% revenue increase compared to the prior corresponding period.
For the full year, Bapcor revised its FY26 statutory NPAT guidance to AU$31 million to AU$36 million, with underlying NPAT now expected to fall between AU$44 million to AU$49 million. This reflects expected improvements in the second half, driven by operational adjustments, pricing realignment, and savings initiatives.
Operational Adjustments and Lender Dialogue
Bapcor continues to work closely with its lenders to secure an adjusted leverage covenant for FY26, enabling the Company to navigate the challenges presented by the weaker first half. Bapcor continues engaging in discussions and is focused on nurturing strong relationships with its financial partners.
The Company also noted that restructuring costs of AU$4 million pre-tax are in line with prior announcements and should not materially impact the overall results for FY26.
Disclaimer for Kapitales Research
The materials provided by Kapitales Research, including articles, news, data, reports, opinions, images, charts, and videos ("Content"), are intended for personal, non-commercial use only. The primary goal of this Content is to educate and inform readers. This Content is not meant to offer financial advice, nor does it include any recommendation or opinion that should be relied upon for making financial decisions. Certain Content on this platform may be sponsored or unsponsored, but it does not serve as a solicitation or endorsement to buy, sell, or hold any securities, nor does it encourage any specific investment activities. Kapitales Research is not authorized to provide investment advice, and we strongly advise users to seek guidance from a qualified financial professional, such as a financial advisor or stockbroker, before making any investment choices. Kapitales Research disclaims all liability for any direct, indirect, incidental, or consequential damages arising from the use of the Content, which is provided without any warranties. The opinions expressed by contributors or guests are their own and do not necessarily reflect the views of Kapitales Research. Media such as images or music used on this platform are either owned by Kapitales Research, sourced through paid subscriptions, or believed to be in the public domain. We have made reasonable efforts to credit sources where appropriate. Kapitales Research does not claim ownership of any third-party media unless explicitly stated otherwise.
Customer Notice:
Nextgen Global Services Pty Ltd trading as Kapitales Research (ABN 89 652 632 561) is a Corporate Authorised Representative (CAR No. 1293674) of Enva Australia Pty Ltd (AFSL 424494). The information contained in this website is general information only. Any advice is general advice only. No consideration has been given or will be given to the individual investment objectives, financial situation or needs of any particular person. The decision to invest or trade and the method selected is a personal decision and involves an inherent level of risk, and you must undertake your own investigations and obtain your own advice regarding the suitability of this product for your circumstances. Please be aware that all trading activity is subject to both profit & loss and may not be suitable for you. The past performance of this product is not and should not be taken as an indication of future performance.
Kapitales Research, Level 13, Suite 1A, 465 Victoria Ave, Chatswood, NSW 2067, Australia | 1800 005 780 | info@kapitales.com.au