Halfords full year profits fall
Cycles and car parts retailer Halfords has reported very disappointing sales during the last two months as it posted a 20% fall in full year pre-tax profit.
In the 52 weeks to 30 March 2012 pre-tax profit dropped to £94.1 from £118.1 million in the previous year. Group revenue fell to £863.1 million from £869.7 million a year earlier while retail revenues on a like-for-like basis were down 2.7%.
The company blamed the decline in profits on a challenging economic environment which had particularly impacted on motorists due to higher fuel and insurance costs.
Within Leisure, cycling like-for-like revenues increased 9.7% in the year, after a strong performance in both premium bikes and cycle accessories. In-store service revenue rose by 22.6% as fitting demand soared. In addition, Halfords Autocentres revenue continued to grow strongly, up 12.9% £110.8 million.
Halfords said its retail sales for FY13 had been “very disappointing” so far as it had not seen the usual seasonal demand for cycling and outdoor leisure products although it expects a stronger performance from these categories as the year progresses.
In the year ahead the company said it would be investing in its key growth areas of cycling, fitting services and autocentres which would create up to 1,000 new jobs.
The company said its three strategic pillars, the Friend of the Motorist, the Best Cycle Shop in Town, and the Starting Point for Great Getaways, would help it to deliver sustainable revenue growth.
Chief executive David Wild said: "In a challenging consumer environment we have made good progress in our key growth areas of Leisure, including Cycles, Fitting Services and Autocentres. Our success in these categories and our detailed market research demonstrates how customers appreciate the help and value we offer and our opportunity for further growth.
"Halfords continues to be profitable and strongly cash generative and we are seeking to maximise our performance in this demanding retail environment."
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