The Bapcor Ltd (ASX: BAP) share price went up around 3% after the auto parts business delivered more growth in FY22.
Bapcor is a diversified business which is exposed to a wide section of the vehicle industry. It owns businesses like Autobarn, Autopro, Burson, ABS, Midas and Battery Town as well as businesses that service light commercial vehicles and heavy commercial vehicles.
Bapcor share price revs higher on FY22
These are some of the highlights of further growth within the business:
- Revenue increased by 4.6% to $1.84 billion
- Underlying EBITDA (EBITDA explained) increased by 4.3% to $291.5 million
- Underlying net profit after tax (NPAT) went up by 1.2%
- Statutory net profit rose 5.9% to $125.8 million
- Final dividend up 4.5% to 11.5 cents per share
- Full year dividend up 7.5% to 21.5 cents per share
Further details
Bapcor Trade generated both revenue and EBITDA growth. The second half offset the locked-down first half. The Burson network expanded with another 10 new branches and there was also the acquisition of Blacktown Auto Spares.
Bapcor Specialist Wholesale saw full year revenue growth of 10% and EBITDA growth of 16%. It expanded its commercial vehicle and electrical businesses with 14 new branches opened, 12 of which were in the commercial vehicle group.
Bapcor Retail continued its growth from the last couple of years, with revenue up 28% and EBITDA up 21%.
Bapcor New Zealand suffered from a lot of lockdown days – 125 days in FY22 compared to around 90 in FY21.
Outlook for the Bapcor share price
Bapcor thinks the FY22 result provides it with a solid foundation to go from here.
It’s expecting a “solid” underlying performance in FY23. Bapcor thinks that trading will continue to benefit from positive macroeconomic trends. It will also have enhanced distribution capabilities with the new Victorian distribution centre achieving ‘steady stage’ performance. The construction of the Queensland distribution centre is progressing.
Bapcor is aiming to achieve sustainable growth in the medium-term and the long-term.
I think Bapcor is an underrated ASX share. Its profit and dividend continue to be impressive in my opinion. Will the business be able to transition to an electric vehicle environment? I do think that Bapcor Asia has a promising future, in Thailand and with Tye Soon, which could offset any local growth challenges.
Is it a buy? I don’t know how much the business will be able to grow in the next few years. It may be good value today, but there are other ASX growth shares I’ve got my eyes on.
