Halfords upgrades FY22 profit guidance to £80m-£90m

Halfords has announced its interim results for the FY22, upgrading its full year profits to £80m-£90m.

The retailer saw strong revenue growth of 19.2% in H1 FY22 vs FY20, with cycling growth of 8.8% despite supply chain disruption. Sales of e-bikes, e-scooters and accessories also grew by more than 140% on two years ago.

Cycling had a ‘very strong’ FY21 and sales this year, while strong, have been constrained by supply chain issues and industry specific bottlenecks on production, said the retailer. “Cycling availability started the year lower than we would like, and while we hoped to see availability normalise, it unquestionably deteriorated further during the first half.

“Although supply challenges have now begun to ease, we saw shortfalls in our premium ranges of own brand and exclusive mechanical bikes through most of H1, which saw demand outstrip an irregular and unpredictable supply. Nevertheless, we are confident, as supply normalises in the future, that we will see good sales in the categories hardest hit this year and we believe we are well set for Christmas trading.”

Stapleton said: “We are delighted to have delivered a strong H1 performance, driven by market share gains in motoring products, garages and our mobile services business, which now account for more than two thirds of our revenue. We also continued to see a significant contribution from areas of strategic focus, with revenue from group services, online and B2B, all growing by more than 75% on a two-year basis.

“In cycling, demand levels remain good, and we are pleased with the current availability of kids bikes and e-bikes as we head into the Christmas trading period. We have carried good sales momentum into H2 across our business, supported by the easing of supply chain disruption. This has enabled us to increase our FY22 underlying profit before tax guidance to between £80m and £90m.

“We are seeing significant growth in the number of customers choosing electric forms of transport, and we continue to have a market-leading position in the servicing and repair of electric vehicles. Sales of e-bikes, e-scooters and accessories grew by more than 140% on two years ago, and servicing for electric cars in our garages was up 120% year-on-year. We have already invested in the training of more than 1,300 electric technicians and are on track to train 2,000 by the end of FY22, equating to more than two per store or garage. This number will double next year.

“There is good momentum in our existing business, the strategically important area of motoring services continues to grow strongly, and our recent acquisitions are all performing well. As a result, despite the challenging trading environment, I am very excited about our future growth prospects.”

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