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Halfords profit falls as pound weakens

Posted on in Business News , Cycles News , Outdoor News

The bikes and car parts retailer reported a 6.4pc decline in pre-tax profits to £36.6m in its first half and declared an interim dividend per share of 6p, up from 5.83p in the same period a year ago.

Halfords_StoreSales grew 1.5% in stores which have been open a year or more, whilst overall revenues grew 3.8pc to £588.7m in the 26 weeks to September 29th.

Chief financial officer and interim chief executive Jonny Mason said: "We are pleased with our profit performance in the half, as we offset a large part of the approximate £15m increase in costs that resulted from the impact of the weaker pound."

Halfords has said it expects the weak pound to cause a total cost increase of around £25m this year.

Commenting on the results Fiona Cincotta, Senior Market Analyst at City Index suggests Brexit and colder weather could be to blame.

"It looks like the weak pound hasn't encouraged Brits to take as many stay-cations as Halfords might have hoped.

"Like-for-like revenue growth in the retail business must have slowed substantially in the last six weeks of the trading period, given it was tracking at 3.5% at the 20-week mark, only to fall to 1.9% for the entire 26-week first half.

"Cooler weather could be the culprit, combined with a nationwide slump in consumer confidence that's being fanned by uncertainty over Brexit."

 

Reader Comments (1)

I am amazed that Halfords are seeing a loss, when they take 15% from any of their cycle to work vouchers used in bike shops other than their own. Brexit and cold weather, yep, things that all independents are dealing with too!!

lynn, 10 Nov 2017

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