Halfords reports strong full year results but warns of uncertainty ahead
Halfords has reported an uplift in full year sales and profits as its ongoing transformation yields results.
In the year to 1 April 2022, the retailer’s revenue climbed by 6% year-on-year and by 19.9 % on two years ago, while underlying pre-tax profit was up 57.8% to £89.8 million on a two-year basis.
Halfords’ retail motoring and autocentres divisions performed well with revenues climbing by 6.5% and 91.9% respectively compared to two years ago. Cycling sales were also up, increasing by 2.7%, despite supply chain disruption in the period.
Graham Stapleton, Halfords chief executive, said: “The strength and resilience of this performance is a great illustration of Halfords’ transformation over the past two years. Our strategic shift towards motoring services has delivered higher, more predictable and more sustainable returns, and our acquisitions of both National and Iverson Tyres during the year mean that we are now the UK’s largest motoring service provider.”
“Motoring now represents over 70% of Halfords’ total revenue, and the fact that our products and services in this category tend to be needs-based rather than discretionary will help us to navigate our way through the well-documented macroeconomic uncertainty that we are currently seeing.”
Looking forward, Halfords said its transformation is still not complete so the business will not be immune to the impact of issues such as cost inflation and reduced demand, particularly for more discretionary, higher ticket items. Therefore, the retailer is expecting underlying pre-tax profit for the current financial year to be in the range of £65 million to £75 million. Halfords added: “We acknowledge the uncertainty that this year is likely to bring.”
Stapleton said: “While rising inflation and declining consumer confidence will naturally present short-term challenges for any customer-facing business like ours, we remain confident in Halfords’ long-term growth prospects due to our service-led strategy and the enduring strength of our brand, people, products and services.”
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