Bapcor (ASX:BAP) lowered its fiscal 2026 guidance for underlying earnings before interest, taxes, depreciation and amortization (EBITDA) to between AU$144 million and AU$150 million on a post-AASB 16 basis, and to AU$62 million to AU$68 million on a pre-AASB 16 basis, according to a Thursday filing with the Australian bourse.

The cut comes amid material deterioration in trading conditions since late March, with softer conditions expected to continue through the fiscal year as the Middle East conflict hampers business confidence and consumer sentiment, the company said.

In February, Bapcor guided for fiscal 2026 underlying EBITDA of AU$150 million to AU$160 million on a post-AASB 16 basis, and AU$74 million to AU$79 million on a pre-AASB 16 basis.

The guidance cut also reflects expectations for fuel, freight, and supplier costs to remain elevated in May and June, with currency depreciation negatively impacting the earnings of the company's New Zealand business segment, it said.

Bapcor is looking to mitigate the fuel price increase through targeted pricing adjustments in select business units, but cautioned that current trading conditions could result in a non-cash impairment.