Bapcor says good inventory management helped deliver a record profit

Vehicle parts and accessories company Bapcor says investment in distribution centres has helped with supply chain issues as it posted a record full year result.

Bapcor, which owns Autobarn, has delivered a record full year result.

Bapcor has posted a record net profit, with the company saying its investment in distribution centres and attention to inventory has given it an edge.

The company posted a net profit of $125.8m, up 5.9 per cent, with revenues up 4.6 per cent to $1.84bn.

Chief executive Noel Meehan said the company, which has a network of more than 1100 locations across Australia, New Zealand and Thailand, including the Autobarn and Burson Autoparts chains, had continued to grow its store numbers and was selling more own-brand products across all segments.

Bapcor opened 31 new stores over the year, with 10 in trade, 14 in specialist wholesale and seven in retail.

“Inventory availability remains a key competitive advantage and significant progress was made in the development of our distribution capabilities with our Victorian distribution centre on track to achieve steady-state performance and the construction of our Queensland distribution centre progressing well,’’ Mr Meehan said.

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“This helped to mitigate the ongoing risk from global supply chain disruption due to manufacturing, transportation and staff shortages which increased product shortages in the

market and raised ordering lead times to unprecedented levels, with a flow-on effect to

temporarily elevate Bapcor’s inventory levels.”

Bapcor declared a fully-franked dividend of 11.5c per share, up from 11c for the previous period.

All of the company’s four main divisions delivered improved results, even while Bapcor New Zealand “experienced particularly trying market conditions’’ with 125 days of Covid lockdowns in the first half - more than the entire previous year’s number.

Despite these headwinds, the New Zealand division still increased revenues and earnings.

Bapcor Trade had a stronger second half, offsetting lockdown shortfalls and Covid impacts from the first half.

Bapcor Specialist Wholesale had a “strong performance” with full year revenues up 10 per cent and earnings up 16 per cent.

“Bapcor Retail consolidated the growth from prior years with revenues up 28 per cent and EBITDA up 21 per cent compared to FY20,’’ the company said.

“This robust result also benefited from a stronger performance in the second half of the year with same store sales growth through the second half of FY22 of 2.7 per cent for Autobarn and 2 per cent for Autopro & Sprints.’’

Bapcor said it expected a solid underlying performance in the current financial year, with positive macroeconomic trends forecast as well as continuing benefits as its distribution centres were bedded down.

“We expect a solid underlying trading performance with our continued focus on network growth, realising operational efficiencies and expanding our own brand product range,’’ Mr Meehan said.

Bapcor’s fully-franked dividend will be paid on September 16.

The company’s shares were changing hands for $6.94 on Wednesday, up 2.5 per cent.