The Bapcor (ASX:BAP) share price is rising after FY21 earnings on Wednesday

Bapcor shares are rising after the auto parts business reported.

| More on:
share price gaining

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Bapcor Ltd (ASX: BAP) share price is rising after the auto parts company released its FY21 result to the market.

What was in the Bapcor FY21 result?

The company reported that it saw growth across the business in multiple areas.

Bapcor's total revenue grew 20.4% to $1.76 billion, with pro forma earnings before interest, tax, depreciation and amortisation (EBITDA) going up by 28.8% to $279.5 million.

Pro forma earnings before interest and tax (EBIT) grew 39% to $200.8 million and net profit increased 50% to $118.8 million. However, pro forma earnings per share (EPS) 'only' grew by 26.8% to 38.3 cents.

Division breakdown

A large amount of the profit contribution comes from the trade segment (namely Burson Auto Parts), where revenue grew 15.5% and EBITDA increased 19%. Burson added another 14 stores to reach 200 stores across Australia.

Specialist Wholesale revenue grew 26.8% and EBITDA increased 42.2%. Excluding acquisitions, such as Truckline, revenue grew 17.3% and EBITDA rose 32%.

Retail (including Autobarn) saw revenue rise 26.1% and EBITDA increased 20.1%.

The company is expanding into Asia. It currently has six operating locations in the Bangkok region of Thailand, with the seventh ready to open (but delayed until COVID restrictions ease). It also bought a 25% stake of Tye Soon, which has around 60 locations across Asia. COVID has caused a lot of volatility for the Bapcor share price since February 2020.

Bapcor has paused Burson Thailand growth as it continues to recover to pre-COVID levels.

Bigger dividend payout for shareholders

Bapcor's dividend continues to grow at a double digit pace. The board decided on a 15.8% increase for the final dividend to 11 cents per share.

This meant the full year dividend had been increased by 14.3% to 20 cents per share.

The full year payout represented a dividend payout ratio of 52% of pro forma EPS.

FY22 growth and expectations

Bapcor announced that significant progress has continued to be made in investments to drive the long-term success of the business, which could also influence the Bapcor share price.

It has completed its new distribution warehouse building at Tullamarine in Victoria, with retail having successfully transferred into the facility. A new distribution centre has been approved for Queensland.

Bapcor continues to invest in its digital transformation. The new Autobarn e-commerce platform is being implemented, along with the new business to business platforms in Australia, Thailand and New Zealand.

Management believe there are further opportunities to drive the performance of the business including further network growth, realising operational efficiencies and expansion of its own brand product range.

However, at the moment its goal is to try to achieve pro forma earnings of at least the level of FY21, but it depends on the extent on lockdowns and other government restrictions.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bapcor. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Senior man wearing glasses and a leather jacket works on his laptop in a cafe.
Broker Notes

Should I still swap my CSL for CBA shares or has the market corrected?

The two stocks have travelled opposite directions this month.

Read more »

Man with rocket wings which have flames coming out of them.
Resources Shares

Why Macquarie expects this ASX All Ords copper stock could surge 38%

With costs coming in below expectations, this ASX All Ords copper stock could rocket higher over the coming months.

Read more »

woman holding 'hiring' sign in shop
Broker Notes

Can you guess whether Macquarie prefers REA Group, CAR Group or SEEK shares?

Which ASX online classifieds business offers the best investment opportunity today?

Read more »

An ASX shares broker analysing a chart tracking the A2 Milk share price
Share Market News

Are these two struggling ASX materials shares undervalued?

Are these buy-low candidates?

Read more »

Female miner smiling in front of a mining vehicle as the Pilbara Minerals share price rises
Broker Notes

Expert says this ASX All Ords small cap mining stock could rocket 38%

Big upside ahead?

Read more »

Happy man working on his laptop.
Share Market News

5 things to watch on the ASX 200 on Wednesday

It looks set to be another good session for Aussie investors tdaoy.

Read more »

Two laughing young women hold shopping bags and ride an escalator up to another level in a Scentre Group shopping centre.
Broker Notes

3 ASX consumer sector shares to buy in July: expert

A leading expert has named its top 3 picks.

Read more »

Man drawing an upward line on a bar graph symbolising a rising share price.
Broker Notes

Broker says WiseTech shares can hit $135

Bell Potter has good things to say about this rebounding tech stock.

Read more »