Halfords profits beat forecast despite Covid impact

Halfords posted underlying pre-tax profit of £55.9m, down 4.9% on the previous year but better than had been anticipated “despite the late impact of Covid-19”. Excluding acquisitions and the effect of the pandemic, Halfords said that would have been “in line with last year”.

Halfords’ sales inched up 0.3% over the year to £1.1bn.

Overall sales at Halfords’ retail division fell 2.7%, or 2.3% like for like, over the year where a strong performance in cycling could not fully offset a tough market in motoring products. 

Cycling sales rose 2.3% over the year. During the lockdown, in the 13 weeks to July 3, cycling sales rocketed 57% like for like, ”significantly boosted by the avoidance of public transport, favourable weather conditions and increased adoption of cycling as a health and leisure activity”.

Group sales over the 13-week period fell 2.8% compared with the previous year and were down 6.5% like-for-like, which Halfords said was “significantly better than anticipated in late March” and an improvement on the 23% like-for-like slide reported in May.

Halfords’ online sales rose 200% year on year in the first quarter.

Halfords chief executive Graham Stapleton said: “This has been another year of good progress against the backdrop of a retail market that was challenging even before the emergence of the Covid-19 pandemic. 

“The start of the current financial year has of course been dominated by the impact of Covid-19 and our status as an essential retailer was a clear endorsement of the wider role that Halfords has to play in keeping the UK moving.

“Having responded quickly and decisively to cater for the surge in popularity of cycling during lockdown, we are now seeing increased demand for motoring services and products as people start using their cars regularly again having not done so for the last few months.

“Despite the wider uncertainty caused by Covid-19, we remain confident in the long-term prospects for Halfords given the strong macro tailwinds within our market-leading motoring and cycling businesses.”