independent

Wednesday 16 April 2014

Halfords posts 23pc profit slump

BICYCLES-to-car-parts group Halfords posted a 23pc slump in first-half profit as a better second-quarter sales performance failed to offset a poor start to the year.

The company – which trades from over 460 Halfords stores in Ireland and the UK, in addition to over 260 car centres – said it made a pretax profit before one-off items of £41.9m (€52.1m) in the 26 weeks to September 28.

That was in line with company guidance of £40-£42m issued last month but down from £54.7m made in the same period last year.

Shares fell as much as 4.9pc in early trading, the biggest intra-day decline since July 11. The shares had risen 75pc since July 18, the day before former chief executive David Wild quit.

Halfords said first-half sales rose 0.4pc to £455.6m, with a weather-impacted first quarter fall in sales at stores open over a year of 5.6pc reversing to a rise of 5.6pc in the second quarter, as demand for bikes rose on the back of Britain's success in the Tour de France and Olympics.

Rising prices

British retailers are mostly struggling as consumers hold back spending in the face of current job insecurity, rising prices, subdued wages growth and government austerity measures.

Halfords, which last month appointed Matt Davies, the former Pets at Home boss, as its chief executive, said its second-half planning assumptions were unchanged and it maintained full-year profit guidance of £66-70m.

The group ended the period with net debt of £107.9m and, as expected, is paying an unchanged interim dividend of 8 pence a share. (Reuters)

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