Bapcor Limited

ABN 80 153 199 912

Appendix 4D and Financial Report for the half-year ended 31 December 2017

Lodged with the ASX under Listing Rule 4.2A

Bapcor Limited Appendix 4D 31 December 2017

1. Company details

Name of entity: Bapcor Limited ABN: 80 153 199 912 Reporting period: For the half-year ended 31 December 2017 (‘H1 FY18’) Previous period: For the half-year ended 31 December 2016 (‘H1 FY17’)

2. Results for announcement to the market

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$’000 % $’000
Revenue from continuing operations Up 181,014 41.6 to 616,132
Earnings before interest, taxes, Statutory Up 24,565 53.8 to 70,195
depreciation and amortisation from
continuing operations Pro-forma Up 21,040 42.8 to 70,195
Statutory Up 15,152 60.0 to 40,405
Net profit after tax from continuing
operations
Pro-forma Up 12,582 45.2 to 40,405
Statutory Up 18,241 72.2 to 43,494
Net profit after tax
Pro-forma Up 12,955 46.6 to 40,778
Earnings per share - basic (cents per Statutory Up 6.00 cps 62.1 to 15.66 cps
share)
- including contribution from discontinued
operations Pro-forma Up 3.97 cps 37.3 to 14.61 cps
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Statutory revenue and net profit after tax for H1 FY18 increased by 41.6% and 72.2% respectively compared to H1 FY17.

Pro-forma net profit after tax from continuing operations increased by 45.2%. The increase in pro-forma net profit after tax reflects the impact of the acquisitions of Hellaby and other acquisitions made during H2 FY17 as well as the profit growth of Bapcor’s existing Trade and Specialist Wholesale businesses.

Earnings per share for H1 FY18 was 14.61 cents per share, up 37.3% compared to H1 FY17 (based on pro-forma NPAT including contribution from discontinued operations).

Net debt at 31 December 2017 was $337.1M representing a leverage ratio of 2.2X (Net Debt : last twelve months EBITDA). The level of debt represents a reduction of $44.8M compared to 30 June 2017 and includes the proceeds from the divestment of the non-core Footwear and Contract Resources businesses.

For a further explanation of the results above, refer to the Company’s ASX/Media Announcement for the half-year ended 31 December 2017 and the accompanying Directors’ Report.

Bapcor Limited Appendix 4D 31 December 2017

3. Dividends

3. Dividends
		Franked
	Amount per	amount per
	security	security
	Cents	Cents
2017 Final dividend	7.5	7.5
2018 Interim dividend (declared after balance date but not yet paid)	7.0	7.0
Record date for determining entitlements to the dividend:	16 March 2018
Date dividend payable:	27 April 2018

4. Dividend reinvestment plans

Bapcor operates a Dividend Reinvestment Plan (‘DRP’), which provides shareholders with the opportunity to utilise all or part of their dividends to purchase shares in the Company. The DRP will be in operation for the 2018 interim dividend.

Shareholders who elect to participate in the DRP for the 2018 interim dividend will be issued shares at a DRP issue price which will be the average of the daily market price of Bapcor’s shares over the period of ten trading days between 3 April 2018 and 16 April 2018 (‘Pricing Period’), less a 1.5% discount.

The timetable in respect of the 2018 interim dividend and DRP is as follows:

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Event / Action Date
Record Date 16 March 2018
Election Date: Last date for shareholders to make an election to 5.00 pm (Melbourne time) on
participate in the DRP 29 March 2018
Pricing Period Commencement Date 3 April 2018
Last day of Pricing Period 16 April 2018
Announcement of DRP issue price 17 April 2018
Dividend Payment Date / Issue of DRP shares 27 April 2018
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*All dates are subject to change

Details of the DRP can be downloaded from http://www.bapcor.com.au/dividends. In order to participate in the DRP for the 2018 interim dividend, shareholders should ensure that their DRP Election Form is received, or an online election is made, by no later than 5.00 pm (Melbourne time) on 29 March 2018. An online election can be made by visiting www.investorcentre.com.

5. Attachments

The Financial Report of Bapcor Limited for the half-year ended 31 December 2017 is attached.

Bapcor Limited Directors' report 31 December 2017

The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of Bapcor Limited (referred to hereafter as the 'company' or 'parent entity') and the entities it controlled at the end of, or during, the half-year ended 31 December 2017 (‘H1 FY18’).

1. Directors

The following persons were directors of Bapcor Limited during the whole of the financial half-year and up to the date of this report, unless otherwise stated:

Robert McEniry Independent Non-Executive Chairman Darryl Abotomey Chief Executive Officer and Managing Director Andrew Harrison Independent, Non-Executive Director Therese Ryan Independent, Non-Executive Director Margaret Haseltine Independent, Non-Executive Director

2. Principal activities

The principal activities of Bapcor were the sale and distribution of motor vehicle aftermarket parts and accessories, automotive equipment and services, and motor vehicle servicing.

Bapcor is one of the largest automotive aftermarket parts, accessories, equipment and services supplier in Australasia with a continuing operations store network covering over 800 sites.

3. Review of operations

During H1 FY18 Bapcor’s operations included its principal automotive activities as well as the non-core businesses of Footwear and Resource Services which were acquired as part of the Hellaby acquisition in January 2017. The non-core businesses are disclosed as Discontinued Operations. During H1 FY18 the Footwear business and the Contract Resources division of Resources Services were divested, with the remaining division of Resource Services, TBS, being the only remaining Discontinued Operation at 31 December 2017.

The key highlights of Bapcor’s financial results for H1 FY18 compared to H1 FY17 were:

Revenue from continuing operations increased by 41.6% from $435.1M to $616.1M
Statutory earnings before interest, taxes, depreciation and amortisation (‘EBITDA’) from continuing operations increased by 53.8% to $70.2M
Pro-forma EBITDA from continuing operations increased by 42.8% to $70.2M
Statutory net profit after tax (‘NPAT’) from continuing operations increased by 60.0% to $40.4M
Pro-forma NPAT from continuing operations increased by 45.2% to $40.4M
Statutory NPAT including contribution from discontinued operations increased by 72.2% to $43.5M
Pro-forma NPAT including contribution from discontinued operations increased by 46.6% to $40.8M
Pro-forma EPS based on NPAT from continuing operations increased by 36.0% to 14.5 cents per share
● Pro-forma EPS based on NPAT including contribution from discontinued operations increased by 37.3% to 14.6 cents per share
Net debt at 31 December 2017 was $337.1M representing a leverage ratio of 2.2X (Net Debt : last twelve months EBITDA).

Bapcor Limited Directors' report 31 December 2017

The table below reconciles the pro-forma result to the statutory result for H1 FY18 and H1 FY17.

			Consolidated	Consolidated
		H1 FY18	H1 FY18
		Continuing	Discontinued	H1 FY18
$’M	Notes	Operations	Operations	Total	H1 FY17
Statutory NPAT		40.4	3.1	43.5	25.3
Costs associated with the Hellaby acquisition	1	-	-	-	3.5
Interest adjustment	2	-	-	-	(0.8)
Depreciation and amortisation adjustment	3	-	(3.8)	(3.8)	-
Net reserve release to profit and loss	4	-	(1.5)	(1.5)	-
Tax adjustment	5	-	2.6	2.6	(0.2)
Pro-forma NPAT		40.4	0.4	40.8	27.8

Notes:

Relates to one off costs incurred during the acquisition of Hellaby. These costs related to professional advisory fees, target defence costs, finance costs relating to the bridging facility and refinancing, restructuring costs, one time elimination of intercompany profit in stock and other costs.
The interest adjustment reflects the additional interest expense that would have been incurred if the Hellaby related capital raising did not occur due to the reduction in borrowings between the time of the capital raising and the payment for Hellaby shares.
The depreciation and amortisation adjustment relates to the depreciation and amortisation that would have occurred in the Resource Services and Footwear divisions that was not recorded due to their held for sale status.
Relates to the release of net investment hedge and foreign currency reserves to the profit and loss on divestment of Contract Resources and Footwear.
The tax adjustment reflects the tax effect of the above adjustments based on local effective tax rates.

The directors’ report includes references to pro-forma results to exclude the impact of the adjustments detailed above. The directors believe the presentation of non-IFRS financial measures are useful for the users of this financial report as they provide additional and relevant information that reflect the underlying financial performance of the business. NonIFRS financial measures contained within this report are not subject to audit or review.

Pro-forma revenue and EBITDA by segment is as follows:

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Revenue EBITDA [2]
H1 FY18 H1 FY17 Change H1 FY18 H1 FY17 Change
$’M $’M % $’M $’M %
Trade 245.6 230.4 6.6% 34.1 31.3 8.7%
Retail & Service 124.1 117.8 5.4% 14.2 14.2 0.0%
Specialist Wholesale 122.0 97.3 25.4% 12.3 9.8 25.4%
Bapcor NZ (previously
Hellaby Automotive) 148.2 - 16.6 -
Unallocated / Head Office [1] (23.8) (10.4) (128.8%) (7.0) (6.1) (12.5%)
Total continuing operations 616.1 435.1 41.6% 70.2 49.2 42.8%
Assets held for sale 129.4 - 7.7 -
Total 745.5 435.1 71.3% 77.9 49.2 58.4%
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Notes:

Revenue relates to intersegment sales eliminations. EBITDA includes intersegment EBITDA and acquisition costs. H1 FY18 EBITDA includes Hellaby head office costs of $1.0M and intersegment elimination of intercompany profit in stock of $1.0M.
Reclassifications in H1 FY17 between segments have occurred to ensure comparability with the presentation of H1 FY18.

Bapcor Limited Directors' report 31 December 2017

3.1 Operating and financial review – Trade

The Trade segment currently consists of the Burson Auto Parts and Precision Automotive Equipment business units. This segment is a distributor of:

Automotive aftermarket parts and consumables to trade workshops for the service and repair of passenger and commercial vehicles
Automotive workshop equipment such as vehicle hoists and scanning equipment, including servicing of the equipment
Automotive accessories and maintenance products to do-it-yourself vehicle owners.

The Trade segment had a successful H1 FY18, and compared to H1 FY17, recorded revenue and EBITDA growth of 6.6% and 8.7% respectively.

The increase in revenue of 6.6% included same store sales growth of 3.4% (compared to 4.6% in FY17). Trade’s EBITDA percentage was 0.3 percentage points above H1 FY17 however competition for volume restricted margins during the period. In January 2018 a market wide selling price increase was implemented by both Burson Auto Parts.

During H1 FY18, Burson Auto Parts continued to expand its store network with the number of stores increasing from 160 at 30 June 2017 to 163 at 31 December 2017. The increase of 3 stores consisted of 3 greenfield store developments. The average cost per new store including inventory was $617,000.

The new stores are located in Narellan in New South Wales; Kingston in Tasmania and Albion in Queensland.

Trade also successfully completed the acquisition of Tricor Engineering during the half-year. Tricor Engineering is a business specialising in the supply and installation of lubrication equipment in the Car Dealership and Heavy Vehicle Workshop market and operates out of the Precision Automotive Equipment business unit.

3.2 Operating and financial review – Retail & Service

The Retail & Service segment consists of business units that are retail customer focused, and include the Autobarn, Autopro, Sprint Auto Parts and Car Parts retail store brands, and the Midas and ABS workshop service brands. The majority of this segment is franchised stores and workshops. There are also 62 company owned stores.

Revenue for the Retail & Service segment in H1 FY18 increased by 5.4% compared to H1 FY17 which includes the impact of a higher ratio of company owned stores versus franchise operations. Same store sales growth for franchise stores was approximately 1% and for company owned stores approximately 5%. Predominately, as a result of the higher mix of company owned stores generating a higher level of sales relative to profit, EBITDA as a percentage of sales decreased by 0.6 percentage points from 12.1% in H1 FY17 to 11.4% in H1 FY18.

Bapcor has continued to grow the number of company owned Autobarn stores via both greenfield Autobarn stores as well as some select conversion of franchise stores to company owned stores. The total number of Autobarn stores at 31 December 2017 was 124 stores, a net increase of 2 stores since 30 June 2017. The number of company owned stores increased from 31 to 39, with the 8 new stores consisting of 4 greenfield stores and the conversion of 4 franchise operations. The percentage of company owned Autobarn stores is now 31%, up from 25% at 30 June 2017.

At 31 December 2017 the total number of company owned and franchise stores in the Retail segment was 385 consisting of Autobarn 124 stores, Autopro 88 stores, Sprint Auto Parts 39 stores and Midas and ABS 134 stores.

3.3 Operating and financial review – Specialist Wholesale

The Specialist Wholesale segment consists of the operations that specialise in automotive aftermarket wholesale and include AAD, Bearing Wholesalers, Opposite Lock, Baxters, MTQ and Roadsafe.

The Specialist Wholesale segment achieved revenue and EBITDA growth of 25.4% and 25.4% respectively compared to H1 FY17. This is partly due to the acquisitions of Baxters, MTQ and Roadsafe now being included for the full six months, as well as improved performance in AAD and Opposite Lock.

Continued progress was made during the financial half-year to increase the volume and product groups that the Specialist Wholesale segment sells into other Bapcor group businesses and this will continue in H2 FY18 with growing the level of intercompany sales being a key business strategy.

Bapcor Limited Directors' report 31 December 2017

3.4 Operating and financial review – Bapcor New Zealand

Bapcor New Zealand (previously Hellaby Automotive) consists of Trade and Specialist Wholesale businesses located in New Zealand and Australia and operates across more than 120 locations.

In New Zealand, Trade operates from 79 locations, of which BNT is the predominant business operating from 53 stores supplying automotive truck parts and accessories to workshops. BNT is similar to Bapcor’s Burson Automotive business that operates in Australia. Also in New Zealand are the Specialist Wholesale businesses of JAS Oceania NZ - an auto electrical business, HCB – a battery business, Diesel Distributors – a distributor of diesel fuel components, and TRS – a tyre and wheel business predominantly supplying the agricultural market.

In Australia, Bapcor New Zealand operates the auto electrical businesses of JAS Oceania, PAT and Federal Batteries, as well as Diesel Distributors.

Bapcor New Zealand has performed very strongly and contributed $16.6M EBITDA to the H1 FY18 group results (excluding Hellaby head office costs). In local New Zealand currency and compared to the Hellaby reported results for H1 FY17, revenue and EBITDA increased by 10.0% and 29.5% respectively. In H1 FY18 the Australian Dollar versus the New Zealand dollar has strengthened by approximately 5% versus the previous financial year which negatively impacted EBITDA by $0.4M.

Bapcor New Zealand’s largest business is the BNT trade business. In H2 FY18 BNT achieved same store sales growth of 8.5% reflecting the success of organisation changes, range expansion and market growth.

3.5 Operating and financial review – Unallocated / Head Office

The Unallocated / Head Office segment consists of all elimination and head office costs or adjustments that are not in the control of the other segments. Unallocated costs increased from $6.1M in H1 FY17 to $7.0M in H1 FY18 due largely to the inclusion of Hellaby related head office costs of $1.0M.

3.6 Operating and financial review – Assets Held for Sale

As part of the acquisition of Hellaby in January 2017, Bapcor acquired the businesses of Resource Services and Footwear. These assets were deemed non-core and reported as held for sale. During H1 FY18, the Contract Resources division of Resource Services and the Footwear business were successfully divested. Total proceeds less costs to sell for these divestments was $54.6M which was in line with estimate disclosed as part of the 30 June 2017 financial report.

The Resource Services business of TBS remains as held for sale, with a sale expected in H2 FY18.

3.7 Financial Position - Capital Raising and Debt

In September 2017, Bapcor issued 932,347 shares to participating shareholders under its Dividend Reinvestment Plan, in respect of the FY17 final dividend. As a result of this issue, ordinary shares on issue increased from 278,633,080 as at 30 June 2017 to 279,565,427 as at 31 December 2017.

Net debt at 31 December 2017 was $337.1M representing a leverage ratio of 2.2X (Net Debt : last twelve months EBITDA).

4. Likely development and expected results of operations

Bapcor expects to continue to see growth in H2 FY18 from business synergies and store network growth as well as solid performance in underlying businesses.

Bapcor continues to forecast pro-forma FY18 NPAT from continuing operations to be circa 30% above FY17 pro-forma NPAT from continuing operations.

Bapcor Limited Directors' report 31 December 2017

5. Matters subsequent to the end of the financial half-year

In January 2018 Bapcor entered into a joint venture agreement with two Asian based partners with Bapcor holding 51% of the share capital. The joint venture initially intends to open a relatively small number of greenfield automotive parts and accessory stores in a major city centre in South East Asia to ascertain the viability of expanding in the region. The initial investment by Bapcor is approximately $2.5M.

From 1 February 2018 the Australian based Specialist Wholesale businesses of Bapcor New Zealand will report to the COO of the Specialist Wholesale business segment and hence will for part of that segment for future reporting. As part of this organisation restructure, the CEO of Hellaby Automotive will become COO New Zealand looking after the New Zealand based operations of Bapcor, as well as being responsible for Bapcor Group Strategic Marketing.

Apart from the dividend declared, no other matter or circumstance has arisen since 31 December 2017 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

6. Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 8 of the directors' report.

7. Rounding of amounts

The company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.

This report is made in accordance with a resolution of directors, pursuant to section 306(3)(a) of the Corporations Act 2001.

On behalf of the directors

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Robert McEniry Chairman

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Darryl Abotomey

Chief Executive Officer and Managing Director

20 February 2018 Melbourne

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Auditor’s Independence Declaration

As lead auditor for the review of Bapcor Limited for the half-year ended 31 December 2017, I declare that to the best of my knowledge and belief, there have been:

(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and
(b) no contraventions of any applicable code of professional conduct in relation to the review.

This declaration is in respect of Bapcor Limited and the entities it controlled during the period.

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Jason Perry Partner PricewaterhouseCoopers

Melbourne 20 February 2018

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2 Riverside Quay, SOUTHBANK VIC 3006, GPO Box 1331, MELBOURNE VIC 3001 T: 61 3 8603 1000, F: 61 3 8603 1999, www.pwc.com.au

PricewaterhouseCoopers, ABN 52 780 433 757

Liability limited by a scheme approved under Professional Standards Legislation.

Bapcor Limited Contents 31 December 2017

Consolidated statement of comprehensive income	10
Consolidated statement of financial position	12
Consolidated statement of changes in equity	13
Consolidated statement of cash flows	14
Notes to the consolidated financial statements	15
Directors' declaration	38
Independent auditor's review report to the members of Bapcor Limited	39

General information

The financial statements cover Bapcor Limited as a consolidated entity consisting of Bapcor Limited and the entities it controlled at the end of, or during, the half-year. The financial statements are presented in Australian dollars, which is Bapcor Limited's functional and presentation currency.

Bapcor Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

61 Gower Street, Preston VIC 3072 AUSTRALIA

A description of the nature of the consolidated entity's operations and its principal activities are included in the Directors' Report, which is not part of the financial statements.

The financial statements were authorised for issue, in accordance with a resolution of directors, on 20 February 2018. The directors have the power to amend and reissue the financial statements.

Bapcor Limited Consolidated statement of comprehensive income For the half-year ended 31 December 2017

Note Revenue from continuing operations Expenses Cost of sales Employee benefits expense Freight Advertising Administration Motor vehicles IT & communications Occupancy Acquisition costs 4 Depreciation and amortisation expense 4 Finance costs 4 Profit before income tax expense from continuing operations Income tax expense 5 Profit after income tax expense from continuing operations Profit after income tax expense from discontinued operations 6 Profit after income tax expense for the half-year Other comprehensive income Items that may be reclassified to profit or loss Foreign currency translation Changes in the fair value of cash flow hedges Other comprehensive income for the half-year, net of tax Total comprehensive income for the half-year Profit for the half-year is attributable to: Non-controlling interest Owners of Bapcor Limited 21 Total comprehensive income for the half-year is attributable to: Non-controlling interest: Continuing operations Discontinued operations Total non-controlling interest Owners of Bapcor Limited Continuing operations Discontinued operations Total owners of Bapcor Limited	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 616,132 435,118 (335,143) (239,411) (129,596) (85,619) (10,485) (6,365) (13,629) (11,930) (23,366) (18,089) (5,022) (3,587) (6,318) (5,372) (22,151) (15,222) (227) (3,893) (7,441) (5,995) (6,133) (2,677)	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 616,132 435,118 (335,143) (239,411) (129,596) (85,619) (10,485) (6,365) (13,629) (11,930) (23,366) (18,089) (5,022) (3,587) (6,318) (5,372) (22,151) (15,222) (227) (3,893) (7,441) (5,995) (6,133) (2,677)
	56,621 (16,216)	36,958 (11,705)
	40,405 3,089	25,253 -
	43,494 (13,590) 3,398	25,253 - 1,390
	(10,192)	1,390
	33,302	26,643
	(214) 43,708	- 25,253
	43,494	25,253
	- (214)	- -
	(214)	-
	30,213 3,303	26,643 -
	33,516	26,643
	33,302	26,643

The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes

Bapcor Limited Consolidated statement of comprehensive income For the half-year ended 31 December 2017

		Consolidated	Consolidated
		31 Dec	31 Dec
	Note	2017	2016
		$'000	$'000
		Cents	Cents
Earnings per share for profit from continuing operations attributable to the
owners of Bapcor Limited
Basic earnings per share	30	14.48	9.66
Diluted earnings per share	30	14.42	9.61
Earnings per share for profit from discontinued operations attributable to the
owners of Bapcor Limited
Basic earnings per share	30	1.11	-
Diluted earnings per share	30	1.10	-
Earnings per share for profit attributable to the owners of Bapcor Limited
Basic earnings per share	30	15.66	9.66
Diluted earnings per share	30	15.60	9.61

The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes

Bapcor Limited Consolidated statement of financial position As at 31 December 2017

Note Assets Current assets Cash and cash equivalents Trade and other receivables 7 Inventories 8 Derivative financial instruments Income tax receivable Assets held for sale 9 Total current assets Non-current assets Trade and other receivables 10 Property, plant and equipment 11 Intangibles 12 Deferred tax asset Other 13 Total non-current assets Total assets Liabilities Current liabilities Trade and other payables 14 Derivative financial instruments Income tax payable Provisions 15 Liabilities relating to assets held for sale 16 Total current liabilities Non-current liabilities Borrowings 17 Derivative financial instruments Provisions 18 Total non-current liabilities Total liabilities Net assets Equity Issued capital 19 Reserves 20 Retained profits/(accumulated losses) 21 Equity attributable to the owners of Bapcor Limited Non-controlling interest Total equity	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 60,139 39,755 136,079 135,784 275,097 261,627 328 40 2,842 - 44,763 178,860	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 60,139 39,755 136,079 135,784 275,097 261,627 328 40 2,842 - 44,763 178,860
	519,248	616,066
	135 52,086 669,341 14,649 3,406	296 49,781 647,831 18,664 4,061
	739,617	720,633
	1,258,865	1,336,699
	181,513 796 2,105 45,998 11,625	174,768 1,780 3,455 32,131 70,842
	242,037	282,976
	396,021 333 22,068	429,747 637 33,372
	418,422	463,756
	660,459	746,732
	598,406	589,967
	602,684 (10,037) 5,759	600,675 (202) (17,067)
	598,406 -	583,406 6,561
	598,406	589,967

The above consolidated statement of financial position should be read in conjunction with the accompanying notes

Bapcor Limited

Consolidated statement of changes in equity For the half-year ended 31 December 2017

Consolidated Balance at 1 July 2016 Profit after income tax expense for the half- year Other comprehensive income for the half- year, net of tax Total comprehensive income for the half-year Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs Share-based payments Treasury shares Dividends paid (note 22) Balance at 31 December 2016 Contributed equity Consolidated $'000 Balance at 1 July 2017 602,571 Profit/(loss) after income tax expense for the half-year - Other comprehensive income for the half-year, net of tax - Total comprehensive income for the half-year - Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs (note 19) 4,606 Share-based payments (note 20) - Treasury shares (note 19) - Finalisation of prior year business combinations - Divestment of non-controlling interest (note 6) - Dividends paid (note 22) - Balance at 31 December 2017 607,177	Contributed equity $'000 416,427 - -	Other $'000 - - -	Reserves $'000 845 - 1,390	Accumulated losses $'000 (51,052) 25,253 -	Total equity $'000 366,220 25,253 1,390
	- 181,783 - - -	- - - (1,896) -	1,390 - 1,028 - -	25,253 - - - (14,781)	26,643 181,783 1,028 (1,896) (14,781)
	598,210	(1,896)	3,263	(40,580)	558,997
	Other $'000 (1,896) - -	Reserves $'000 (202) - (10,192)	Retained earnings $'000 (17,067) 43,708 -	Non- controlling Interests $'000 6,561 (214) -	Total equity $'000 589,967 43,494 (10,192)
- 4,606 - - - - -	- - - (2,597) - - -	(10,192) - 357 - - - -	43,708 - - - - - (20,882)	(214) - - - (4,820) (1,527) -	33,302 4,606 357 (2,597) (4,820) (1,527) (20,882)
607,177	(4,493)	(10,037)	5,759	-	598,406

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes

Bapcor Limited Consolidated statement of cash flows For the half-year ended 31 December 2017

Note Cash flows from operating activities Receipts from customers (inclusive of GST) Payments to suppliers and employees (inclusive of GST) Payments for new store initial inventory purchases Payments associated with discontinued operations Borrowing costs Transaction costs relating to acquisition of business Income taxes paid Net cash from operating activities Cash flows from investing activities Payment for purchase of business, net of cash and cash equivalents Payment for deferred settlements Payments for property, plant and equipment 11 Payments for intangibles 12 Proceeds from disposal of property, plant and equipment Proceeds from divestment of businesses 6 Net cash from/(used in) investing activities Cash flows from financing activities Proceeds from issue of shares Share issue transaction costs Purchase of treasury shares 19 Net repayment of borrowings Dividends paid Borrowing transaction costs Net cash from/(used in) financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the financial half-year Effects of exchange rate changes on cash and cash equivalents Cash and cash equivalents at the end of the financial half-year	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 675,388 477,546 (606,475) (429,834)	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 675,388 477,546 (606,475) (429,834)
	68,913 (2,687) (531) (6,267) (227) (18,549)	47,712 (7,593) - (2,293) (1,761) (15,232)
	40,652	20,833
	(6,894) (6,354) (7,826) (496) 345 54,340	(27,618) (995) (7,629) (555) 527 -
	33,115	(36,270)
	- (414) (2,597) (34,004) (15,986) (24)	184,075 (3,957) (1,896) (134,000) (14,781) (935)
	(53,025)	28,506
	20,742 39,755 (358)	13,069 22,392 -
	60,139	35,461

Note: the consolidated statement of cash flows represents the statement of cash flows of the continuing operations only. Discontinued operation's cash flows have been excluded as cash flow disclosures are not required for divestment groups that are classified as held for sale on acquisition in accordance with AASB 5 Non-current Assets Held for Sale and Discontinued Operations .

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 1. Significant accounting policies

These general purpose financial statements for the interim half-year reporting period ended 31 December 2017 have been prepared in accordance with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001, as appropriate for for-profit oriented entities. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 Interim Financial Reporting .

These general purpose financial statements do not include all the notes of the type normally included in annual financial statements. Accordingly, these financial statements are to be read in conjunction with the annual report for the year ended 30 June 2017 and any public announcements made by the company during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The principal accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period, unless otherwise stated.

New or amended Accounting Standards and Interpretations adopted

The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.

Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

Note 2. Restatement of comparatives

The financial statements contain reclassifications of prior year disclosures to ensure comparability with the current year presentation.

Note 3. Operating segments

Description of segments

The consolidated entity has identified four operating segments based on the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Makers ('CODM')) in assessing performance and in determining the allocation of resources including capital allocations.

The operating results of the consolidated entity are currently reviewed by the CODM and decisions are based on four operating segments which also represent the four reporting segments, as follows:

Trade	Represents the trade focused automotive aftermarket parts distribution to independent
	and chain mechanic workshops. Includes the operations of Burson Auto Parts and
	Precision Automotive Equipment.
Retail & Service	Represents the retail focused accessory stores that are positioned as the first choice
	destination for both the everyday consumer and automotive enthusiast as well as the
	service areas of Bapcor. Includes the operations of Autobarn, Autopro, Sprint Auto Parts,
	Midas and ABS.
Specialist Wholesale	Includes the specialised wholesale distribution areas of the organisation that focus on a
	specific automotive area. Includes the operations of AAD, Baxters, Bearing Wholesalers,
	MTQ Engine Systems and Roadsafe.
Bapcor NZ (previously	Represents the operations of Brake & Transmission, Autolign, Diesel Distributors, Federal
Hellaby Automotive)	Batteries, HCB Technologies, JAS Oceania, Premier Auto Trade, and TRS Tyre & Wheel.

There is likely to be changes in reportable segments in the near future as the Hellaby businesses become integrated into the consolidated entity.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 3. Operating segments (continued)

Segment revenue

Intersegment transactions are carried out at arm's length and eliminated on consolidation. The revenue from external parties reported to the CODM is measured in a manner consistent with that in the statement of comprehensive income.

Segment EBITDA

Segment performance is assessed on the basis of segment EBITDA. Segment EBITDA comprises expenses which are incurred in the normal trading activity of the segments and excludes the impact of depreciation, amortisation, interest, share-based payments and other items which are determined to be outside of the control of the respective segments.

Operating segment information

Trade $'000 245,553	Retail & Service $'000 124,114	Specialist Wholesale $'000 121,980	Bapcor NZ $'000 148,244	Unallocated / Head Office $'000 -	Total $'000 639,891
245,553	124,114	121,980	148,244	-	639,891 (23,759) 129,417
34,087	14,191	12,298	16,623	(5,799)
					745,549
					71,400 (978) (7,441) (6,133) (227) 6,273
288,612	281,367	207,751	381,151	55,221
					62,894 (19,400)
					43,494
					1,214,102 44,763
92,515	36,426	21,154	48,531	450,208
					1,258,865
					648,834 11,625 660,459

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 3. Operating segments (continued)

Trade $'000 230,406	Retail & Service $'000 117,806	Specialist Wholesale $'000 97,288	Bapcor NZ $'000 -	Unallocated / Head Office $'000 -	Total $'000 445,500
230,406	117,806	97,288	-	-	445,500 (10,382)
31,349	14,228	9,803	-	(3,344)
					435,118
					52,036 (2,513) (5,995) (2,677) (3,893)
280,947	274,241	196,610	358,191	47,850
					36,958 (11,705)
					25,253
					1,157,839 178,860
91,273	37,549	30,493	44,794	471,781
					1,336,699
					675,890 70,842 746,732

There has been reclassifications of segment EBITDA to ensure comparability between years.

Geographical information

Australia New Zealand	Sales to external customers 31 Dec 2017 31 Dec 2016 $'000 $'000 528,174 435,118 87,958 -	Sales to external customers 31 Dec 2017 31 Dec 2016 $'000 $'000 528,174 435,118 87,958 -	Geographical non-current assets 31 Dec 2017 30 Jun 2017 $'000 $'000 542,606 531,719 182,362 170,250	Geographical non-current assets 31 Dec 2017 30 Jun 2017 $'000 $'000 542,606 531,719 182,362 170,250
	616,132	435,118	724,968	701,969

The geographical non-current assets above are exclusive of, where applicable, financial instruments, deferred tax assets and balances such as intercompany and investments that are eliminated on consolidation. It only pertains to the continuing operations of the consolidated entity.

Revenue is allocated to geographical segments on the basis of where the sale is recorded.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 4. Expenses

Note 4. Expenses
Profit before income tax from continuing operations includes the following specific expenses: Depreciation and amortisation expense Plant and equipment Motor vehicles Amortisation Make good provision Acquisition and divestment costs Professional consultant costs Other transaction costs Finance costs Interest and finance charges paid/payable Rental expense relating to operating leases Minimum lease payments Superannuation expense Superannuation expense	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 3,546 2,261 2,009 1,778 1,677 1,809 209 147
	7,441	5,995
	194 33	1,916 1,977
	227	3,893
	6,133	2,677
	19,878	13,325
	7,934	6,106

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 5. Income tax

Income tax expense Current tax on profits for the year Deferred tax expense Relating to discontinued operations Aggregate income tax expense Income tax expense is attributable to: Profit from continuing operations Profit from discontinued operations Aggregate income tax expense Numerical reconciliation of income tax expense and tax at the statutory rate Profit before income tax expense from continuing operations Profit before income tax expense from discontinued operations Tax at the statutory tax rate of 30% Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Entertainment expenses Acquisition and divestment costs Other Difference in overseas tax rates Income tax expense	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 11,603 12,766 4,613 (1,061) 3,184 -	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 11,603 12,766 4,613 (1,061) 3,184 -
	19,400	11,705
	16,216 3,184	11,705 -
	19,400	11,705
	56,621 6,273	36,958 -
	62,894	36,958
	18,868 67 708 453	11,087 7 626 (15)
	20,096 (696)	11,705 -
	19,400	11,705

Note 6. Discontinued operations

Description

The discontinued operations relate to the business units of Footwear and Resource Services that were acquired as part of the Hellaby Holdings Limited acquisition and deemed held for sale on acquisition. During the half-year the Contract Resources division of Resource Services and the Footwear business unit was successfully divested. As these were divested within the twelve month acquisition accounting preliminary period, no gain or loss from these have been recognised in the profit and loss rather the acquired held for sale position has been adjusted as part of the finalisation of the acquisition accounting. Refer to notes 9, 16 and 28 for further information.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 6. Discontinued operations (continued)

Financial performance information

Footwear Resource Services Total revenue Footwear Resource Services Total expenses Profit before reserve reclassification Foreign currency reserve reclassification Net investment hedge reserve reclassification Total reserve reclassifications Profit before income tax expense post reserve reclassifications Income tax expense Profit after income tax expense from discontinued operations Carrying amounts of assets and liabilities divested Assets held for sale Total assets Liabilities held for sale Total liabilities Net assets	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 27,245 - 102,172 -	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 27,245 - 102,172 -
	129,417	-
	(28,135) (96,537)	- -
	(124,672) 4,745 (1,355) 2,883	- - -
	1,528 6,273 (3,184)	- -
	3,089	-
	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 67,300 -
	67,300	-
	42,702	-
	42,702	-
	24,598	-

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 6. Discontinued operations (continued)

Details of the divestments

Net cash sale consideration, net of divestment costs paid Carrying amount of net assets divested Net accrued consideration to be received Accrued divestment and warranty costs Cash proceeds used to settle intercompany debt Derecognition of non-controlling interest Gain on divestment before income tax Gain on divestment after income tax	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 54,340 - (24,598) - 2,253 - (2,016) - (31,506) - 1,527 -	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 54,340 - (24,598) - 2,253 - (2,016) - (31,506) - 1,527 -
	-	-
	-	-

The Footwear division and Contract Resources (North America component only) were divested effective 30 September 2017, and the Contract Resources (excluding the North America component) effective 31 October 2017.

The final consideration adjustment for Contract Resources is yet to be finalised.

Cash flow disclosures are not required for divestment groups that are classified as held for sale on acquisition in accordance with AASB 5 Non-current Assets Held for Sale and Discontinued Operations .

Note 7. Current assets - trade and other receivables

Trade receivables Less: Provision for impairment of receivables Customer loans Less: Provision for impairment of customer loans Other receivables Prepayments	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 124,377 126,524 (7,554) (8,296)	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 124,377 126,524 (7,554) (8,296)
	116,823	118,228
	1,267 (846)	1,366 (851)
	421	515
	10,297 8,538	12,118 4,923
	18,835	17,041
	136,079	135,784

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 8. Current assets - inventories

Stock in transit - at cost Stock on hand - at cost Less: Provision for slow moving inventory Movements in provision for slow moving inventory: Balance at 1 July 2017 Additional provisions recognised Additions through business combinations Stock written off against provision Foreign currency translation Balance at 31 December 2017	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 13,939 13,325	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 13,939 13,325
	311,068 (49,910)	302,287 (53,985)
	261,158	248,302
	275,097	261,627
		$'000 (53,985) (593) (528) 4,660 536 (49,910)

Note 9. Current assets - assets held for sale

Footwear Resource Services	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 - 27,391 44,763 151,469	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 - 27,391 44,763 151,469
	44,763	178,860

As part of the Hellaby Holdings Limited acquisition in the prior financial year, the two acquired business segments of Footwear and Resource Services were immediately deemed held for sale at the time of acquisition. During the half-year ending 31 December 2017, the consolidated entity has divested the Footwear business segment and the Contract Resources business unit of the Resource Services business segment. The TBS business unit of the Resource Services business segment continues to be actively marketed for sale, with completion expected during H2 FY18. The assets and liabilities of this business are classified as held for sale as at 31 December 2017. The results of all held for sale businesses during the half-year ended 31 December 2017 have been reported as discontinued operations (refer note 6).

AASB 5 Non-current Assets Held for Sale and Discontinued Operations requires that when the divestment group is acquired as part of a business combination, it is measured at fair value less costs to sell. The fair value less costs to sell of the TBS business unit of the Resource Services business segment has been determined to be NZD $34.5M. The assets held for sale component has been grossed up by the current book value of the associated liabilities which are reported in note 16, as well as the net cash and debt on hand as at 31 December 2017 as this divestment is intended to be net of cash and debt balances. Net cash and debt as at 31 December 2017 for TBS was NZD $1.9M.

Refer to note 24 for information relating to the determination of the fair value of the assets held for sale.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 10. Non-current assets - trade and other receivables

Note 10. Non-current assets - trade and other receivables
Customer loans Less: Provision for impairment of receivables	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 498 603 (363) (307)
	135	296

Note 11. Non-current assets - property, plant and equipment

Plant and equipment - at cost Less: Accumulated depreciation Motor vehicles - at cost Less: Accumulated depreciation	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 61,188 55,016 (27,047) (22,409)	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 61,188 55,016 (27,047) (22,409)
	34,141	32,607
	29,462 (11,517)	27,396 (10,222)
	17,945	17,174
	52,086	49,781

Reconciliations

Reconciliations of the written down values at the beginning and end of the current financial half-year are set out below:

Consolidated Balance at 1 July 2017 Additions Additions through business combinations (note 28) Disposals Foreign currency translation Transfers in/(out) Depreciation expense Balance at 31 December 2017	Plant and equipment $'000 32,607 4,821 458 (30) (77) (92) (3,546)	Motor vehicles $'000 17,174 3,005 141 (260) (57) (49) (2,009)	Total $'000 49,781 7,826 599 (290) (134) (141) (5,555)
	34,141	17,945	52,086

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 12. Non-current assets - intangibles

Note 12. Non-current assets - intangibles
Goodwill Trademarks Customer contracts Less: Accumulated amortisation Software Less: Accumulated amortisation	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 584,929 561,843
	58,932	59,443
	25,520 (4,100)	25,543 (3,251)
	21,420	22,292
	9,418 (5,358)	8,959 (4,706)
	4,060	4,253
	669,341	647,831

Reconciliations

Reconciliations of the written down values at the beginning and end of the current financial half-year are set out below:

Consolidated Balance at 1 July 2017 Additions Additions through business combinations (note 28) Finalisation of prior year business combinations (note 28) Foreign currency translation Transfers in/(out) Amortisation expense Balance at 31 December 2017	Computer software $'000 4,253 496 - - (27) 143 (805)	Customer contracts $'000 22,292 - - - - - (872)	Trade names $'000 59,443 - - (277) (234) - -	Goodwill $'000 561,843 - 5,462 32,573 (14,949) - -	Total $'000 647,831 496 5,462 32,296 (15,210) 143 (1,677)
	4,060	21,420	58,932	584,929	669,341

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 13. Non-current assets - other

Note 13. Non-current assets - other
Make good asset Employee loans	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 1,176 1,085 2,230 2,976
	3,406	4,061

Employee loans were made to key management personnel and other personnel to assist in the purchase of shares. These loans are secured by the underlying shares acquired. The loans are interest bearing and are repayable on the earlier of sale of the underlying shares, termination of employment or five years from the date of the loan in cash, and cannot be settled by the employees returning the shares to the company.

Note 14. Current liabilities - trade and other payables

Note 14. Current liabilities - trade and other payables
Trade payables Accrued expenses	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 137,811 133,966 43,702 40,802
	181,513	174,768

Note 15. Current liabilities - provisions

Note 15. Current liabilities - provisions
Employee benefits Deferred settlements Onerous lease provision	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 29,430 27,191 15,827 4,267 741 673
	45,998	32,131

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 16. Current liabilities - liabilities relating to assets held for sale

Note 16. Current liabilities - liabilities relating to assets held for sale
Footwear Resource Services Eliminations	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 - 8,184 11,625 63,000 - (342)
	11,625	70,842

The liabilities relating to assets held for sale relate to the TBS division of the Resource Services business segment which were deemed to be held for sale on business combination of Hellaby Holdings Limited. Refer to note 9 for further information.

Note 17. Non-current liabilities - borrowings

Note 17. Non-current liabilities - borrowings
Secured bank loans Less: unamortised transaction costs capitalised	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 398,225 432,229 (2,204) (2,482)
	396,021	429,747

Bapcor has a $500M debt facility with ANZ, Westpac, The Bank of Tokyo-Mitsubishi UFJ and The Hongkong and Shanghai Banking Corporation.

The debt facility comprises funding in three and five year tranches as follows:

$200M three year tranche, available for general corporate purposes;
$250M five year tranche, available for general corporate purposes;
$50M three year tranche, available for working capital requirements.

The facility is secured by way of a fixed and floating charge over Bapcor's assets.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 18. Non-current liabilities - provisions

Note 18. Non-current liabilities - provisions
Employee benefits Deferred settlements Make good provision Onerous lease provision	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 2,755 2,644 9,731 20,913 8,384 8,169 1,198 1,646
	22,068	33,372

Note 19. Equity - issued capital

31 Dec 2017 Shares 279,565,427 -	Consolidated 30 Jun 2017 31 Dec 2017 Shares $'000 278,633,080 607,177 (200,000) (4,493)	Consolidated 30 Jun 2017 31 Dec 2017 Shares $'000 278,633,080 607,177 (200,000) (4,493)	30 Jun 2017 $'000 602,571 (1,896)
279,565,427	278,433,080	602,684	600,675
	Shares 278,633,080 932,347 - 279,565,427	$'000 602,571 4,896 (290)
		607,177
	Shares (200,000) (22) (480,686) 680,708 -	$'000 (1,896) - (2,597) -
		(4,493)

The average purchase price of treasury shares during the period was $5.40 per share.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 20. Equity - reserves

Note 20. Equity - reserves
Foreign currency reserve Cash flow hedge reserve Share-based payments reserve Net investment hedge reserve	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 (14,508) (918) (705) (2,519) 4,240 3,883 936 (648)
	(10,037)	(202)

Foreign currency reserve

This reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign operations to Australian dollars.

Cash flow hedge reserve

This reserve is used to recognise the effective portion of the gain or loss of cash flow hedge instruments that is determined to be an effective hedge.

Share-based payments reserve

This reserve is used to recognise the value of equity benefits provided to employees and directors as part of their remuneration, and other parties as part of their compensation for services.

Net investment hedge reserve

This reserve is used to recognise the effective portion of the gain or loss of net investment hedge instruments that is determined to be an effective hedge.

Movements in reserves

Movements in each class of reserve during the current financial half-year are set out below:

Consolidated Balance at 1 July 2017 Revaluation Deferred tax Share-based payment expense Reclassified to profit and loss (note 6) Foreign currency translation Cancellation on divestment Balance at 31 December 2017	Foreign currency reserve $'000 (918) - - - 1,355 (14,945) -	Cash flow hedge reserve $'000 (2,519) 2,197 (632) - - 50 199	Share-based payments reserve $'000 3,883 - (894) 1,251 - - -	Net investment hedge reserve $'000 (648) 3,443 (345) - (2,883) - 1,369	Total $'000 (202) 5,640 (1,871) 1,251 (1,528) (14,895) 1,568
	(14,508)	(705)	4,240	936	(10,037)

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 21. Equity - retained profits/(accumulated losses)

Note 21. Equity - retained profits/(accumulated losses)
Accumulated losses at the beginning of the financial period Profit after income tax expense for the period Dividends paid (note 22) Retained profits/(accumulated losses) at the end of the financial period	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 (17,067) (51,052) 43,708 64,044 (20,882) (30,059)
	5,759	(17,067)

Note 22. Equity - dividends

Dividends

Dividends paid during the financial half-year were as follows:

Final dividend for the year ended 30 June 2017 (2016: 30 June 2016) of 7.5 cents (2016: 6.0 cents) per ordinary share Interim dividend for the year ending 30 June 2017 of 5.5 cents per ordinary share*	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 20,882 14,781 - 15,278 20,882 30,059

$4,896,000 of the final dividend for the year ended 30 June 2017 was settled under the Dividend Reinvestment Plan.
** $4,558,000 of the interim dividend for the year ended 30 June 2017 was settled under the Dividend Reinvestment Plan

The Board has declared an interim dividend in respect of the current financial year of 7.0 cents per share, fully franked. The interim dividend will be paid on 27 April 2018 to shareholders registered on 16 March 2018.

Franking credits

Franking credits available for subsequent financial years based on a tax rate of 30%	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 44,474 38,252

The above amounts represent the balance of the franking account as at the end of the financial half-year, adjusted for:

franking credits that will arise from the payment of the amount of the provision for income tax at the reporting date
● franking debits that will arise from the payment of dividends recognised as a liability at the reporting date
franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 23. Net tangible assets

A large proportion of the consolidated entity's assets are intangible in nature, consisting of goodwill, customer contracts and trademarks acquired on business combination as well as software. These assets as well as any deferred taxes are excluded from the calculation of net tangible assets per share.

Net tangible assets per share at 31 December 2017 was (30.6) (30 June 2017: (16.0)) cents per share.

Net assets per share at 31 December 2017 was $2.09 (30 June 2017: $2.12) per share.

Note 24. Fair value measurement

Fair value hierarchy

The following tables detail the consolidated entity's financial instruments, measured or disclosed at fair value, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.

Level 1 $'000 - -	Level 2 $'000 328 -	Level 3 $'000 - 44,763	Total $'000 328 44,763
-	328	44,763	45,091
- - - - Level 1 $'000 - -	1,129 - - 1,129 Level 2 $'000 40 -	- 11,625 25,559 37,184 Level 3 $'000 - 178,860	1,129 11,625 25,559 38,313 Total $'000 40 178,860
-	40	178,860	178,900
- - - -	2,417 - - 2,417	- 70,842 25,180 96,022	2,417 70,842 25,180 98,439

There were no transfers between levels during the financial half-year.

Derivative financial instruments carried at fair value are forward foreign exchange contracts and floating interest rate to fixed interest rate swaps. These are considered to be Level 2 financial instruments because their measurement is derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 24. Fair value measurement (continued)

Deferred consideration is considered to be a Level 3 financial instrument because inputs in valuing this instrument are not based on observable market data. The fair value of this instrument is determined based on an estimated discounted cash flow analysis.

Assets and liabilities held for sale are considered to be a Level 3 financial instrument because inputs in valuing these assets are not based on observable market data. The fair value of these instruments are determined based on information obtained by management during the sale process (e.g. indicative bids, adviser estimates) as well as estimates derived on earning multiples.

Note 25. Commitments and contingent liabilities

Commitments Committed at the reporting date but not recognised as liabilities, payable: Guarantees in relation to leases Letters of credit in relation to the purchase of inventory Guarantees in relation to performance of contracts * Other commitments in relation to facility construction and consumable purchases *	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 2,952 2,982	Consolidated 31 Dec 2017 30 Jun 2017 $'000 $'000 2,952 2,982
	852	343
	- -	483 1,571

The commitments in relation to performance of contracts and facility construction and consumable purchases as at 30 June 2017 related to the discontinued operations of Resource Services

Contingent liabilities

There are no unrecorded contingent liabilities (30 June 2017: Nil).

The divestment of the non-core businesses of Footwear and Contract Resources includes standard indemnity and warranty clauses as is customary in these type of transactions. At the date of this report, the directors are not aware of any material claims under the divestment indemnity and warranty arrangements.

Note 26. Related party transactions

Parent entity

Bapcor Limited is the parent entity.

Key management personnel

Disclosures relating to key management personnel are set out in note 27.

Note 27. Related party transactions - key management personnel disclosures

During the half-year ending 31 December 2017, a total of 767,883 options were granted to 9 key management personnel. Of these options, 200,816 relate to the FY17 year, and 567,067 to the FY18 year. A total of 378,605 relate to the CEO and Managing Director (D Abotomey) of Bapcor. Refer to note 31 for further details.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 28. Business combinations

Current financial half-year acquisitions

The consolidated entity acquired the net assets of the following business:

Tricor Engineering ('Tricor')

The consolidated entity also acquired 100% of the following companies:

Autobarn Bendigo
Autobarn Waurn Ponds
Autobarn Chirnside Park
Autobarn O'Conner
Autopro Seymour

These acquisitions were made to strengthen the Bapcor offering as well as increase the company store network presence.

The assets and liabilities recognised as a result of these acquisitions are set out below. Non-material business combinations have been aggregated. These are provisional at the time of this report and the fair values are to be finalised within the acquisition period of twelve months from acquisition date.

Cash and cash equivalents Trade and other receivables Inventories Plant and equipment Motor vehicles Deferred tax asset Trade and other payables Provisions Net assets acquired Goodwill Acquisition-date fair value of the total consideration transferred Representing: Cash paid Deferred and contingent consideration Debt forgiven Cash used to acquire business, net of cash acquired: Cash consideration Less: cash and cash equivalents Net cash used	Tricor Fair value $'000 - - 75 78 119 72 - (73)	Other Fair value $'000 8 7 2,159 380 22 311 (11) (213)
	271 2,105	2,663 3,357
	2,376	6,020
	1,455 921 -	5,447 - 573
	2,376	6,020
	1,455 -	5,447 (8)
	1,455	5,439

Goodwill in relation to these acquisitions relates to the anticipated future probability of their contribution to the consolidated entity's total business.

Refer to note 4 for details on acquisition related costs incurred.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 28. Business combinations (continued)

Deferred and contingent consideration

A contingent consideration has been estimated and provided for on the Tricor acquisition and is accrued at $937,000 as at 31 December 2017 (notes 15 and 18) which is based on expected future earnings. This payment is due to the vendor if certain future targets are met.

Prior financial year acquisitions

In the previous financial year the consolidated entity made the following acquisitions:

Hellaby Holdings Limited
Baxters Pty Ltd
MTQ Engine Systems (Aust) Pty Ltd
Roadsafe Automotive Products
Autopro Raymond Terrace
Autopro Gladstone
Autopro Colac
Autopro Gawler
Autobarn Burleigh Heads
Autobarn Beenleigh
Autobarn Nambour
Autobarn Orange
Autobarn Virginia

Hellaby Holdings Limited finalisation of acquisition accounting

Trade and other receivables Inventories Assets held for sale Plant and equipment Intangible assets Deferred tax asset Trade and other payables Deferred tax liability Liabilities held for sale Provisions Bank overdraft Bank loans Net assets attributable to non-controlling interests Net assets acquired Goodwill Acquisition-date fair value of the total consideration transferred	31 Dec 2017 Fair value $'000 36,280 65,581 121,341 5,328 11,107 9,952 (34,984) (3,009) (59,624) (8,323) (1,065) (79,487) (1,985)	30 Jun 2017 Fair value $'000 36,280 65,581 163,334 5,328 11,384 9,952 (34,984) (3,087) (64,423) (8,323) (1,065) (79,487) (6,805)
	61,112 273,573	93,685 241,000
	334,685	334,685

The change to the held for sale valuation relate to the finalisation of working capital of the discontinued operating divisions of Hellaby Holdings Limited. The underlying cash proceeds expectation presented at 30 June 2017 of NZD 92.4M is still expected to be achieved following the sale of TBS.

The above includes an estimate of the Contract Resources final working capital adjustment as this was not final as per the date of this report. Further, TBS is still based on an estimated position.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 29. Events after the reporting period

From 1 February 2018 the Australian based Specialist Wholesale businesses of Bapcor New Zealand will report to the COO of the Specialist Wholesale business segment and hence will form part of that segment for future reporting. As part of this organisation restructure, the CEO of Hellaby Automotive will become COO New Zealand looking after the New Zealand based operations of Bapcor, as well as being responsible for Bapcor Group Strategic Marketing.

Apart from the dividend declared as disclosed in note 22, no other matter or circumstance has arisen since 31 December 2017 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

Note 30. Earnings per share

Note 30. Earnings per share
Earnings per share for profit from continuing operations Profit after income tax attributable to the owners of Bapcor Limited Basic earnings per share Diluted earnings per share Earnings per share for profit from discontinued operations Profit after income tax attributable to the owners of Bapcor Limited Basic earnings per share Diluted earnings per share	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 40,405 25,253
	Cents Cents 14.48 9.66 14.42 9.61 Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 3,089 -
	Cents 1.11 1.10	Cents - -

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Earnings per share for profit Profit after income tax Non-controlling interest Profit after income tax attributable to the owners of Bapcor Limited Basic earnings per share Diluted earnings per share Weighted average number of ordinary shares Weighted average number of ordinary shares used in calculating basic earnings per share Adjustments for calculation of diluted earnings per share: Options over ordinary shares Weighted average number of ordinary shares used in calculating diluted earnings per share	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 43,494 25,253 214 -	Consolidated 31 Dec 2017 31 Dec 2016 $'000 $'000 43,494 25,253 214 -
	43,708	25,253
	Cents 15.66 15.60 Number 279,104,321 1,034,278	Cents 9.66 9.61 Number 261,399,654 1,263,052
	280,138,599	262,662,706

The weighted average number of ordinary shares for 2016 has been restated for the effect of any rights issues performed in accordance with AASB 133 Earnings Per Share .

Note 31. Share-based payments

The Long Term Incentive ('LTI') plan is intended to assist in the motivation, retention and reward of certain senior executives. The LTI is a payment contingent on two and three year performance and the payments are rights to acquire shares ('Performance Rights'). Refer to the 30 June 2017 audited Remuneration Report within the Directors' Report for further information on the LTI.

In FY18 the following offers were made to eligible participants:

In relation to the FY17 year for the CEO and Managing Director (D Abotomey) following the successful passing of a resolution at the FY17 Annual General Meeting. These allocated Performance Rights have a performance period that ends 30 June 2019 at which time the performance hurdles are tested.
In relation to the FY17 year for the Chief Executive - Hellaby Automotive (C Daly). These allocated Performance Rights have a performance period that ends 30 June 2018 and 30 June 2019 in line with the FY17 offer that was previously made to other executives at which time the performance hurdles are tested.
In relation to the FY18 year an offer to participate in the LTI was made to nine of Bapcor’s senior executives. These allocated Performance Rights have a performance period that ends on 30 June 2020 at which time the performance hurdles are tested.

Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 31. Share-based payments (continued)

A summary of the terms for the Performance Rights granted in the current financial half-year are set out in the following tables:

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FY17 Tranche 1 Tranche 2
Grant date 15 August 2017 15 August 2017
Performance hurdle Relative TSR EPS Relative TSR EPS
Performance period 1/7/16 to 30/6/18 1/7/16 to 30/6/18 1/7/16 to 30/6/19 1/7/16 to 30/6/19
Test date 30 June 2018 30 June 2019
Expiry date Once tested Once tested
Quantity granted 4,999 2,978 9,354 5,882
Exercise price Nil Nil
Fair value at 15/8/17 [1] $2.892 $5.411 $3.037 $5.301
Other conditions Restriction on sale to 30/6/19 Restriction on sale to 30/6/20
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FY17
Grant date 4 December 2017
Performance hurdle Relative TSR EPS
Performance period 1/7/16 to 30/6/19
Test date 30 June 2019
Expiry date Once tested
Quantity granted 88,802 88,801
Exercise price Nil
Fair value at 4/12/17 [1] $2.842 $5.372
Other conditions Restriction on sale to 30/6/20
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FY18
Grant date 4 December 2017
Performance hurdle Relative TSR EPS
Performance period 1/7/17 to 30/6/20
Test date 30 June 2020
Expiry date Once tested
Quantity granted 283,535 283,532
Exercise price Nil
Fair value at 4/12/17 [1] $3.059 $5.249
Other conditions Restriction on sale to 30/6/21
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The fair value represents the value used to calculate the accounting expense as required by accounting standards.

Relative total shareholder return ('TSR') hurdle

Fifty per cent of the Performance Rights granted to a participant will vest subject to a TSR performance hurdle that assesses performance by measuring capital growth in the share price together with income returned to shareholders, measured over the performance period against a Comparator Group of companies. The Performance Rights will vest by reference to Bapcor's TSR performance ranking against this Comparator Group of companies, as follows:

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Bapcor’s TSR relative to the Comparator Group over the Percentage of TSR Rights
performance period vesting
Less than 50th percentile Nil
Equal to 50th percentile 50%
Greater than 50th percentile and less than 75th percentile Pro-rata straight-line vesting
Equal to or greater than 75th percentile 100%
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Bapcor Limited Notes to the consolidated financial statements 31 December 2017

Note 31. Share-based payments (continued)

Earnings per share ('EPS') growth

Fifty per cent of the Performance Rights granted to a participant will vest by reference to an EPS performance hurdle that measures the basic EPS on a normalised basis over the performance period. Each tranche of Performance Rights subject to an EPS hurdle will vest as follows:

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Bapcor's compound annual EPS growth over the
performance period Percentage of EPS Rights Vesting
Less than 7.5% Nil
7.5% 20%
Greater than 7.5% and less than 15% Pro-rata straight-line vesting
Equal to or greater than 15% 100%
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Performance Rights issued up to 30 June 2017 are exercised as soon as the vesting conditions are met. If vesting conditions are met, Performance Rights will automatically convert into fully paid ordinary shares of the Company.

For Performance Rights issued on or after 1 July 2017, if the vesting conditions are met, the Performance Rights are converted into fully paid ordinary shares of the Company at the election of the Participant.

There is no specific expiry date, however the Performance Rights lapse if vesting condition are not met.

Shares will be subject to a restriction on sale for twelve months from vesting of the Performance Rights.

Set out below are summaries of Performance Rights granted under the LTIP:

Exercise Grant date Vesting date price 24/04/2014 30/06/2017 $0.00 01/07/2015 30/06/2017 $0.00 01/07/2015 30/06/2018 $0.00 01/08/2015 30/06/2017 $0.00 01/08/2015 30/06/2018 $0.00 01/07/2016 30/06/2018 $0.00 01/07/2016 30/06/2019 $0.00 01/07/2017 30/06/2020 $0.00	Balance at the start of the half-year 475,362 128,868 246,986 76,478 146,574 124,286 237,389 - 1,435,943	Granted - - - - - 7,977 192,839 567,067 767,883	Exercised (475,362) (128,868) - (76,478) - - - - (680,708)	Expired/ forfeited/ other - - (23,252) - - (9,414) (17,981) - (50,647)	Balance at the end of the half-year - - 223,734 - 146,574 122,849 412,247 567,067 1,472,471

Employee Salary Sacrifice Share Plan

During the financial half-year, Bapcor issued shares to employees via an Employee Salary Sacrifice Share Plan ('ESSSP'). The ESSSP allowed eligible employees to acquire up to $1,000 of shares from their pre-tax wages. The value of this share-based payment transaction is deemed immaterial to the financial statements.

Bapcor Limited Directors' declaration 31 December 2017

In the directors' opinion:

the attached financial statements and notes comply with the Corporations Act 2001, Australian Accounting Standard AASB 134 Interim Financial Reporting , the Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes give a true and fair view of the consolidated entity's financial position as at 31 December 2017 and of its performance for the financial half-year ended on that date; and
there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of directors made pursuant to section 303(5)(a) of the Corporations Act 2001.

On behalf of the directors

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Robert McEniry Chairman 20 February 2018 Melbourne

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Darryl Abotomey

Chief Executive Officer and Managing Director

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Independent auditor's review report to the members of Bapcor Limited

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of Bapcor Limited (the Company), which comprises the consolidated statement of financial position as at 31 December 2017, the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the half-year ended on that date, a summary of significant accounting policies, other explanatory notes and the directors' declaration for Bapcor Group. The Group comprises the Company and the entities it controlled during that half-year.

Directors' responsibility for the half-year financial report

The directors of the Company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that is free from material misstatement whether due to fraud or error.

Auditor's responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Australian Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the consolidated entity’s financial position as at 31 December 2017 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of Bapcor Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 .

2 Riverside Quay, SOUTHBANK VIC 3006, GPO Box 1331, MELBOURNE VIC 3001 T: 61 3 8603 1000, F: 61 3 8603 1999, www.pwc.com.au Liability limited by a scheme approved under Professional Standards Legislation.

PricewaterhouseCoopers, ABN 52 780 433 757

Independent auditor's review report to the members of Bapcor Limited (continued)

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Bapcor Limited is not in accordance with the Corporations Act 2001 including:

giving a true and fair view of the consolidated entity’s financial position as at 31 December 2017 and of its performance for the half-year ended on that date;
complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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PricewaterhouseCoopers

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Jason Perry Partner

Melbourne 20 February 2018

AI assistant

BAPCOR LIMITED — Interim / Quarterly Report 2018

64494_rns_2018-02-19_c85b737f-2b93-4fdd-bec8-a38691d336b7.pdf

Bapcor Limited

ABN 80 153 199 912

Appendix 4D and Financial Report for the half-year ended 31 December 2017

1. Company details

2. Results for announcement to the market

3. Dividends

4. Dividend reinvestment plans

5. Attachments

1. Directors

2. Principal activities

3. Review of operations

Notes:

Notes:

3.1 Operating and financial review – Trade

3.2 Operating and financial review – Retail & Service

3.3 Operating and financial review – Specialist Wholesale

3.4 Operating and financial review – Bapcor New Zealand

3.5 Operating and financial review – Unallocated / Head Office

3.6 Operating and financial review – Assets Held for Sale

3.7 Financial Position - Capital Raising and Debt

4. Likely development and expected results of operations

5. Matters subsequent to the end of the financial half-year

6. Auditor's independence declaration

7. Rounding of amounts

Auditor’s Independence Declaration

General information

Bapcor Limited Consolidated statement of comprehensive income For the half-year ended 31 December 2017

Bapcor Limited

Consolidated statement of changes in equity For the half-year ended 31 December 2017

Bapcor Limited Consolidated statement of cash flows For the half-year ended 31 December 2017

Note 1. Significant accounting policies

New or amended Accounting Standards and Interpretations adopted

Note 2. Restatement of comparatives

Note 3. Operating segments

Description of segments

Note 3. Operating segments (continued)

Segment revenue

Segment EBITDA

Operating segment information

Note 3. Operating segments (continued)

Geographical information

Note 4. Expenses

Note 5. Income tax

Note 6. Discontinued operations

Description

Note 6. Discontinued operations (continued)

Note 6. Discontinued operations (continued)

Note 7. Current assets - trade and other receivables

Note 8. Current assets - inventories

Note 9. Current assets - assets held for sale

Note 10. Non-current assets - trade and other receivables

Note 11. Non-current assets - property, plant and equipment

Reconciliations

Note 12. Non-current assets - intangibles

Reconciliations

Note 13. Non-current assets - other

Note 14. Current liabilities - trade and other payables

Note 15. Current liabilities - provisions

Note 16. Current liabilities - liabilities relating to assets held for sale

Note 17. Non-current liabilities - borrowings

Note 18. Non-current liabilities - provisions

Note 19. Equity - issued capital

Note 20. Equity - reserves

Foreign currency reserve

Cash flow hedge reserve

Share-based payments reserve

Net investment hedge reserve

Movements in reserves

Note 21. Equity - retained profits/(accumulated losses)

Note 22. Equity - dividends

Dividends

Franking credits

Note 23. Net tangible assets

Note 24. Fair value measurement

Fair value hierarchy

Note 24. Fair value measurement (continued)

Note 25. Commitments and contingent liabilities

BAPCOR LIMITED Interim / Quarterly Report 2018