Halfords posts drop in profit as demand for bikes wanes
Halfords has posted a drop in full year profit as it warned of soft trading in its new financial year.
The car parts and cycling retailer saw its underlying pre-tax profit decline by 18.3% to £36.1 million in the year to 29 March as headwinds outside of its control were worse than anticipated.
While cycling like-for-like revenue dropped by 2.8% as customers reduced spending on big ticket, discretionary items, there were respective uplifts of 4.9% and 10.7% in retail motoring and at Halfords Autocentres, which meant that like-for-like revenue climbed by 5% across the group.
Graham Stapleton, chief executive officer of Halfords, said: This has been a year of strong strategic and operational progress for Halfords, and we are pleased to have delivered a resilient financial performance against challenging core markets. We have continued to invest in our strategically important services business, which for the first time now represents over half of our total revenues.
“Our Autocentres business was the star performer yet again. This was delivered despite a challenging tyre market, where drivers continue to delay the replacement of unsafe tyres.”
Halfords said trading since the year end has continued to be soft due to low consumer confidence around big ticket, discretionary purchases and poor spring weather.
Stapleton added: “While the short-term outlook remains challenging, we continue to build a unique, digitally-enabled, omnichannel business, which is well positioned for profitable growth.”
