Bapcor shares tank on operational review, first-half earnings hit
Make us a preferred source
Make us a preferred source on Google
The news: Autobarn owner Bapcor saw its shares tumble in early trading after announcing a slew of cost-saving initiatives.
A series of operational reviews have also been undertaken, with the tools and equipment business “requiring immediate attention”, as the company flagged a $12 million hit to first-half earnings.
The numbers: At 10:48am AEDT, shares in Bapcor had slipped 15.5% to $2.68.
Autobarn has issued full-year statutory net profit after tax guidance of between $40 million and $50 million, when excluding a 1H26 impairment associated with the New Zealand segment. Underlying NPAT is expected to be in the range $51 million and $61 million.
Capital expenditure is expected to be in the range $32 million and $38 million, with a focus on "targeted branch expansions and technology investments”, although some investments are being counted as incurred expenses.
Undrawn committed debt facilities at 30 September 2025, were $331.6 million, down from $342.6 million.
The cost cutting initiative is expected to generate about $20 million in pre-tax savings to 2H26 earnings, with implementation costs of about $4 million (pre-tax) to be incurred in 1H26.
The context: A series of operational reviews were undertaken in the September quarter an ongoing “in-depth review of the tools and equipment business within the Trade segment” having identified "unsatisfactory operational practices requiring immediate attention”.
Changes in management have been made to the business. First-half earnings are expected to take a $12 million pre-tax hit from “non-recurring margin impacts as well as stocktake variances and stock adjustments”.
The cost savings initiative includes supply chain optimisation, “simplification of support office structure”, shifting spend on people and technology to focus on customer-facing activities and changes to New Zealand distribution.
What they said: “Our roots have been built on acquiring businesses, not integrating them. Some of the practices that have been accepted inside the wider business do not meet acceptable operational standards nor the required financial/commercial expectations,” Bapcor executive chair and CEO Angus McKay said.
“Over the past 15 months, we have methodically progressed the complex work of addressing our structure and capability to re-focus on restoring customer confidence and performance.
“I acknowledge the continued discovery of historic poor operational practices is frustrating, however we are committed to facing into the issues and correcting them.”
The source: ASX
