Halfords boss Graham Stapleton has hailed his business’ resilience in the face of the cost-of-living crisis, despite underlying profit falling in the first half.

Halfords electric-bike-service

Halfords said it made ‘strong progress’ during the first half on its cost and efficiency programme

Halfords said underlying profit before tax halved to £29m in the 26 weeks to September 30. Underlying EBITDA was down £23.7m to £92m and profit before tax tumbled £35m to £29.3m. 

Halfords Group sales for the period were £765.7m, up £70.9m, driven by a £109.1m increase in autocentres sales to £265.2m. Retail sales by comparison were down £38.2m to £500.5m. 

Halfords said the slip in like-for-like retail sales was partly due to strong comparatives on the previous period and the challenging economic conditions facing the retailer at the moment. 

The retailer said it had made “strong progress” during the first half on its cost and efficiency programme, saving £9.8m in the first half with more than £20m in savings expected to be found over the full year.

The retailer has bought its utilities in full for FY2023, hedged 50% of its consumption for FY 2024 and locked in £5.5m of extra cost year on year. The retailer’s USD requirements for the rest of the year are also 98% hedged against further currency fluctuations. 

Chief executive officer Graham Stapleton said: “This has been a period of strong strategic progress and resilient financial performance for Halfords. In such a volatile macroeconomic environment, our strategy of focusing on the kind of predictable and recurring revenue that comes from motoring services and needs-based products has never been more relevant.

“Once the acquisition of Lodge Tyre has annualised, service-related sales will account for over 48% of our revenues and we expect this to grow to over 50% next year. Lodge Tyre will also mean motoring represents around 77% of total sales.

“The success of our Motoring Loyalty Club is exceeding our expectations, as customers continue to be attracted by a range of discounts and offers that are aimed at helping motorists across the UK with the rocketing cost of running and maintaining a car.

“The club is playing a key role in the rapidly growing demand that we are seeing for vehicle servicing, MOTs, maintenance and repairs. In order to help meet that demand, we are today launching a recruitment drive to fill 1,000 new automotive technician roles over the next 12 months.

“In particular, we are hoping to attract retirees back into the workforce, as well as increasing the number of women in technician roles.” 

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