Bapcor Limited

ASX:BAP

Bapcor Limited

ASX:BAP
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$4.57 (+1.1%)
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#447
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2
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Forum Topics BAP BAP Bapcor Ltd General Discussion
nerdag
Added 2 years ago

Excellent straw @mikebrisy. I too am very happy to see the renewed emphasis on capital discipline.

Agree that the primary issue is logistics, because it isn't really a retailer. I think the market is discounting it as a discretionary retailer, where in practice it's more non-discretionary, yet currently trading cheaper than Woolworths/Coles on P/E basis.

Disc: Held

12
mikebrisy
Added 2 years ago

Rumour about McKinsey strategy review. Awaiting confirmation.

Thoughts?

  • I'm not sure where they are headed in Asia - so an external view with lots of contacts in Asia might help. It all seemed unclear at FY22.
  • Perhaps, also keen to get ahead of the EV thing. How to position $BAP, because it is coming albeit gradually in Oz, although NZ has moved quickly recently.
  • A bit concerned this is Noel "CFO-turned-CEO'"s first move. He's had enough of an apprenticeship under Daryl, you'd have thought his plan for the next year or two was clear. Or is it that Darly himself was running out of steam, and this was a source of tension with the Board?
  • Was this part of the deal with the Board on being confirmed in his role? Surely must be. Otherwise not a good look. Did the Board interview him about his strategic thinking. (CEO interview 101 - I think its covered in the Company Directors course!)
  • With two big centralised DCs coming onstream, I'd have thought there was ample execution head-room to get the supply chain humming to the next level.
  • CEO said they were leading the culture transformation part of "Better than Before" internally. This at least sounds like it was needed given loss of CEO over issues of management style and relationship with the Board.
  • They'll be on a timeline to deliver something for the AGM.


It will be interesting to see if there is any follow-up on this.

Disc. Held

14
Chagsy
Added 2 years ago

mike I’m not sure about your past life, but whenever I hear McKinsey are getting involved it’s a a whole North Korean synchronised stadium of red flags.

Basically, it says: “I don’t know how to run my company/business/health service, can you send over some highly paid teenagers to parrot a bunch of management shite at us. And for that we will pay you a King’s Ransom”

If this is confirmed, I am running for the hills.

12
mikebrisy
Added 2 years ago

Well-spotted. I am an alum - but no offence, you are often right. I had the same reaction!

That is why I seized on the news (or rumour) and thought it worth sharing. I'm not a journo, but usually this wouldn't be published from just one source, even in that particular rag.

7
Chagsy
Added 2 years ago

Too funny!

Excuse my flippancy, I have the greatest respect for the Group (I even listen to their podcasts) but I hold to my view that calling in consultants to tell you how to run your own show is a poor prognostic indicator. Whether McKinsey or any other management consultant.

I have been involved with this sort of process on two separate occasions, and found them very useful, but the organisations I was working for were in a mess.

if BAP is having to do the same, then I would be deeply concerned that they too, are in a mess - and hence not investable.

22
reddogaustin
Added 2 years ago

@mikebrisy @Chagsy

I gotta agree with you (echo chamber check).

Isn't business reviews and strategy the job of the senior management?

It is another flag to me, of the red kind to me.

1. Founder CEO gone (and some other key staff also from what I remember).

2. Debt increasing.

3. Management hiring consultants asking 'how to proceed', aka no vision for the business currently resides in the CEO or Chair.

4. I've held for >5 years, and so by my rules I am allowed to exit.

Seeing as the report isn't due until November 2022, I'm collecting my dividend in September 2022 and selling out.

11
mikebrisy
Added 2 years ago

I’m going to do some work on $BAP before the AGM, as I haven’t yet arrived at a decision. For sure, it is at the lower end of on my conviction list for all the reasons you have listed.

8
AUROPAL
Added 2 years ago

Sorry to echo others views on management consultants in general (not just McKinsey) but I also have not great experiences with what bringing them in means.

I work for a global Fortune 500 company and whenever I see consultants brought into an area or division it's always because they're in trouble.

So as a longterm sharheolder I'm not enthused to see this happening at Bapcor.

12
reddogaustin
Added 2 years ago

@Chagsy

Good straw mate. Your pig with lipstick theory adds fuel to the sell thesis, after watching to see what would happen after the sudden departure of Darryl.

Esit. Add straw link.

9
reddogaustin
Added 3 years ago

Thanks for the straw @endean

But ... What the actual f**k.

"Since the joint announcement of Mr Abotomey’s retirement, there has been a marked deterioration in the relationship between the Board and the CEO, such that Mr Abotomey’s position as MD and CEO has become untenable"

"The leadership transition presents an opportunity for Bapcor to install a more contemporary leadership and management approach to drive the Company’s growth while also ensuring consistent with changing stakeholders’ expectations"

"The Board remains united and committed to serving the best interests of Bapcor and all its shareholders and stakeholders." // does it? really? *cough* lies.

Who writes that in a public announcement? That is akin to admitting the building is on fire, and I started the fire. Wow. Just wow.

I thought BAP was going to be an adult about this transition. After all Darryl has achieved for the company and this is the way he leaves.


Disc. I am a holder in RL, but not for much longer. I am selling!!

25
thunderhead
Added 3 years ago

One of the most odd recent announcements of this nature I have come across. I no longer hold, but was thinking of buying back in on price weakness recently.

18
AUROPAL
Added 3 years ago

Definitely an odd announcement to air such dirty laundry in public and not a good look. Hoepfully it doesn't precede a law suit or some other skeleton coming out of the closet.

20