Car maintenance and bike company Halfords has upgraded its profit guidance after revenues crawled upwards thanks to a strong showing in post-Christmas sales.
The group revealed its like-for-like income climbed by a single percentage point during the 15 weeks to January 11, thanks primarily to a strong showing from its autocentres and wefit car maintenance offering.
While Halfords highlighted a considerable improvement against the same period last year, during which time revenues fell by 2.7%, figures released to the markets also revealed much of the upturn came after Christmas.
It had suffered a like-for-like revenue dip of 0.5% during the 13 weeks to December 28, showing the majority of its gains came during the following fortnight when price reductions were at their peak.
Halfords stressed that figures up to and including the first full week of January would “more accurately reflect the true retail trading performance of the group over the festive season” and committed to report on a similar basis in the future.
Overall, and including new store openings, group revenues accelerated by 1.6% during the period, with the motor business zipping ahead thanks to a 12% increase while retail idled at 0.1% growth.
Halfords said management continued to invest in its motor repair business, while parts sales rose 13.2% and fitting penetration had climbed to a new record of 39.5%.
A record 10.9% of revenues came from online sales.
Chief executive Matt Davies said he was pleased with growth from service-led retail, which the board had prioritised for increased investment.
“Autocentres revenue continues to grow as we focused investment on the new-centre opening programme, capacity for future growth and motorists’ awareness of the brand,” he said.
Like-for-like figures in cycling showed a 1.6% decline in turnover from the same 15-week period last year.
The year-to-date increase from cycling income was marginal at 0.7% as a result.
Mr Davies conceded cycling had “initially disappointed” before Christmas, but added he was pleased with the continuing momentum in high-end, specialist wheels.
“We aim to improve significantly the Halfords customer experience and develop category opportunities where our brand is under-represented in areas such as cycling parts, accessories and clothing; we are on track to deliver this expanded offer in the next financial year,” he said.
Pre-tax profits for the year are expected to reach about £70 million, which Halfords described as a “modest” increase on expectations.
business@thecourier.co.uk