1st Mar 2021 09:20
(Alliance News) -Â Halfords Group PLC on Monday said trading has been "volatile" but stronger than expected as it guided to a sharp jump in annual profit.
Shares in Halfords were up 17% at 339.50 pence in London early Monday.
The provider of motoring and cycling products and services noted that in a January update, it had flagged a weaker like-for-like growth rate as it exited the third quarter. This was due to regional lockdowns hitting motoring demand, as well as global container shortages and port disruption delaying stock arriving into the business.
"Although we have continued to experience a volatile trading environment across the first seven weeks of Q4, overall trading has been stronger than we initially anticipated across the business," said Halfords.
As a result, the retailer expects full-year underlying pretax profit to be around GBP90 million to GBP100 million, even after deciding to repay in full GBP10.7 million of furlough income received. For the financial year that ended April 3, 2020, underlying pretax profit amounted to GBP55.9 million.
For the first seven weeks of the fourth quarter, like-for-like growth was 6.2%, with Retail up 5.1% and Autocentres up 13%.
"Despite journeys being about 40% below pre-pandemic levels, our Autocentre business has continued to demonstrate signs of growing market share, with strong demand for both our garage business and Halfords Mobile Expert vans," Halfords commented.
The company said cycling has seen like-for-like growth rates improve as supply disruption has eased, although overall supply remains "sub-optimal". Cycling like-for-like sales in the period were up 43%.
"Although only six weeks remain of FY21, the expected profit range remains quite broad as trading patterns continue to be volatile, with sales ahead of Easter particularly difficult to predict whilst the UK remains in lockdown. As the country starts to open up once more, our overriding priority remains the health and safety of our colleagues and customers," said Halfords.
By Lucy Heming;Â [email protected]
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