Automotive aftermarket parts supplier Bapcor has downgraded its FY26 earnings guidance, citing softer business confidence, rising fuel costs and ongoing economic uncertainty linked to conflict in the Middle East.
The ASX-listed company says trading conditions deteriorated from late March following the outbreak of conflict in the region, with higher fuel, freight and supplier costs impacting operations.
Bapcor says sales momentum improved between February and April across all business segments compared with the same period last year, reversing declines recorded during the first half of FY26.
Its New Zealand business also returned to growth during the period, with sales up 0.7% year-on-year in NZ dollar terms after previously declining.
The company now expects FY26 underlying EBITDA of A$144 million to A$150 million, down from earlier guidance issued in February.
Bapcor says the weaker outlook reflects declining consumer sentiment and business confidence, along with increased operating costs that emerged during April and are expected to continue through May and June.
The company also says depreciation of the NZ dollar against the Australian dollar has negatively affected earnings from its New Zealand operations.
Chief executive Chris Wilesmith says the company’s turnaround programme is beginning to deliver results despite the difficult trading environment.
“We are pleased with the positive momentum of the turnaround, which has been delivered through decisive actions we’ve taken to improve pricing, stock availability and team engagement,” Wilesmith says.
“This is despite the challenging external environment which was not contemplated when we began this turnaround.”
Bapcor says it has introduced targeted pricing adjustments in some business units to help offset higher fuel costs.
The company says it remains focused on improving profitability, reducing inventory levels, improving stock availability and strengthening customer retention across its Trade, Network and Retail divisions.
