Halfords profits slip in first half
Car parts and cycling retailer Halfords has reported a drop in first half profits after its retail gross margin was impacted by the depreciation of sterling and costs relating to long-term growth and promotional activity.
In the 26 weeks to 30 September, pre-tax profit before non-recurring items fell by 12.1% to £40.8 million although total revenue increased by 6.3% to £567.3 million.
On a like-for-like basis, retail sales rose by 2.4% while sales at Halfords’ autocentres saw a small uplift of 0.9%.
Jill McDonald, Halfords chief executive, said: "The first half sales performance was strong, improving through the period, with growth across all areas of our business. Our service-led offer is a key point of difference for Halfords and continued investment in this area has led to good progress in service-related sales.
“The depreciation of sterling brings cost headwinds. However, we have developed a number of initiatives to mitigate the profit impact and remain confident in the underlying performance of the group."
Halfords said like-for-like sales in the motoring category edged up 1.1% while cycling sales rose by 4.6%.
During the period, the retailer refurbished 12 retail stores and 12 autocentres. It also opened two new autocentres and two Cycle Republic stores
McDonald added: “I'm pleased with the momentum that is building as we implement our strategy. There is demonstrable progress across the plan, with more to come in the year ahead, and the benefits for colleagues and customers are starting to come through.”
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