Car parts distributor and retailer Bapcor is looking for another year of strong profit growth in 2016-17 after lifting net profits by 89% to $43.6 million in the year to June 30.
The sharply higher result was struck on an 82.7% surge in sales that was down to the $283 million acquisition of Metcash’s Autobarn, Autopro and Midas mufflers businesses in 2015 and gains in Bapcor’s traditional trade business, which includes Burson Auto Parts.
Same-store sales in Burson trade outlets rose 4.6% for the second consecutive year and same-store sales in Autobarn retail outlets rose 5.2% (It will be interesting to see how its main rival, Super Cheap Auto went in 2015-16).
The company reported higher profit margins, even though the weaker Aussie dollar did crimp cost recoveries in some product areas.
CEO Darryl Abotomey said yesterday he expects net profits to rise between 25% and 30% in 2016-17, thanks to earnings from 40 new stores, a full 12 months contribution of the Autobarn businesses and new purchases, including Precision Automotive, Sprint Auto Parts and Bearing Wholesalers.
Bapcor, which changed its name from Burson last month, supplies more than car parts to car repairers and chains such as Ultra Tune and Kmart Tyre and Auto.
It moved into direct competition with some of these customers last year by buying Autobarn, Autopro and Midas.
Bapcor increased its final dividend by 27.7% to 6 cents a share taking the full year payout to 11 cents.or,or a payout a ratio of 62%. It was floated last year at $3.40 by its private equity owners, and yesterday jumped 6% to $6.13.
