- Trading in line with expectations
- Shares up 42% over the past year
- Pre-tax profits of £48 million and £58 million expected
Shares in Halfords (HFD) were up 2% to 191p in morning trading as the bikes-to-car retailer reported strong trading across the group for the 20 weeks to 18 August 2023.
Halfords shares are up 42% over the past year as it continues to please cash-strapped motorists with its new services and products.
Despite unfavourable weather conditions throughout Spring and July to August, total revenue was up 14.1% ‘driven by needs-based categories.’
Group like-for-like performance was up 7.8% with the company’s motoring business putting in a particularly strong performance (group motoring accounts for over 75% of total sales), with Autocentres up 16.6% and Retail up 3.4%.
Halfords said trading was ‘in line year-to-date’ with full year underlying pre-tax profit expected to be between £48 million and £58 million.
The company said second half profit is expected to be significantly ahead of last year with: ‘Autocentres making up a higher proportion of group pre-tax profits alongside increased cost and efficiency savings versus full year 2023.’
YODEL WIN
The bikes-to-car retailer said it had increased its market share ‘across all categories’ as well as its B2B (Business to business) division winning a significant nationwide contract with UK delivery firm Yodel.
Halfords CEO Graham Stapleton also chose to announce a new campaign called Dealer or No Dealer designed to raise motorists’ awareness of the choice and cost savings available to them for servicing and repairs with Halfords.
Stapleton reassured motorists by saying ‘any work carried out by Halfords will not affect their manufacturer warranty.’
Why Halford shares are rallying despite 43% profit reverse
Analysts at Liberum were upbeat about Halford’s 20-week trading update, they said in a research note: ‘With no changes to guidance today, we don’t expect a material change to consensus forecasts, which look for full year 2024 pre-tax profits of £53.7 million (full year 2023: £51.5 million) and stronger growth to circa £66 million in full year 2025 (estimated) versus the mid-term target range of £90 million - £110 million set out at the investor day in April.’
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