UK: Halfords remains positive despite impact of freezing weather
- Credit: Newscast/Mathew Growcoot
FREEZING weather has sent bicycle sales tumbling at Halfords but boosted sales of de-icer and screenwash, allowing the retailer to maintain positive momentum for the year.
The car parts and leisure firm, which trades from 460 stores in the UK and Ireland, posted like-for-like sales growth of 0.4% in the 11 weeks to the end of March, helping underlying sales for its full year to the end of March increase by 0.3%.
A delayed start to the season drove bike sales down 8.8% during the 11 weeks, leading to an overall decline of 0.6% for the full year. Growth in premium bike brands, such as Carrera and its range from Olympic cyclist Chris Boardman, plus a 26.5% surge in online parts, accessory and clothing sales, were not enough to offset the weather effect.
But car maintenance sales increased 10.4% during its final quarter, boosted by strong demand for wiper blade fitting and de-icing products. That helped underlying maintenance sales grow 5.1% for the year.
Chief executive Matt Davies, the former Pets at Home boss who joined the group in October, said: “We can genuinely claim to have helped keep the country moving during the big freeze.”
Halfords sold 2.3 million litres of screenwash during the quarter, 56% more than a year earlier, while ice scraper sales were up 80% to 138,000 units.
Mr Davies said it was a “robust performance”, adding it has a strong range ready for spring and summer.
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Halfords, which is due to update on its strategy next month, still expects to deliver pre-tax profits of £68 million to £72 million for the year.
Strong demand for outdoor products such as snow chains and shovels was not enough to prevent sales in its travel solutions arm, which also sells car seats and roof racks, falling 5.5% for the quarter.
Its overall retail arm increased underlying sales 0.3% during the quarter, while sales in its Autocentres division were 0.8% ahead.
Halfords has plans for a big expansion in the fragmented car repair market, and opened 23 new Autocentres to take its total to 283. It plans to open about 20-30 more during its new financial year, offering services including MOTs, tyre fitting and clutch repairs. Autocentres currently comprise about 14% of group revenues.
Mr Davies said: “Any idiot can open large numbers of sites. We want to remain incredibly focused on quality sites that will be there to generate cash for the business for many years to come. There’s this balance we are always looking to achieve between numbers and quality.”