Halfords Group (HFD)

Sector:

Retailers

Index:

FTSE Small Cap

160.50p
   
  • Change Today:
    -0.40p
  • 52 Week High: 234.00
  • 52 Week Low: 147.10
  • Currency: UK Pounds
  • Shares Issued: 218.93m
  • Volume: 747,167
  • Market Cap: £351.38m
  • RiskGrade: 239

Halfords cautious on outlook despite strong bike sales

By Sean Farrell

Date: Tuesday 07 Jul 2020

LONDON (ShareCast) - (Sharecast News) - Halfords said it was cautious about its outlook as the car accessories and bicycle retailer reported better-than-expected recent trading based on strong bike sales.
Underlying pretax profit for the year to 3 April fell to £55.9m from £58.8m a year earlier as revenue edged up 0.3% to £1.16bn. Retail revenue fell 2.7% with good bike sales failing to offset tough trading for car products.

Sales in the 13 weeks to 3 July fell 2.8% from a year earlier and 6.5% like-for-like, which Halfords said was much better than predicted in late March and an improvement on the 23% like-for-like drop in the four weeks to 1 May. Bike sales rose 57% as people bought bikes to avoid public transport and get out during the warm weather. Bike maintenance revenue increased 42% as households got their old bikes in shape.

Motoring revenue fell 45.4% in the 13 weeks to 3 July as car journeys plunged during the Covid-19 lockdown. Halfords said sales were picking up as restrictions eased with high demand for batteries.

Despite better-than-expected trading Halfords withdrew financial guidance and instead set out three scenarios. These showed revenue declining 9.5%, 7.5% or 5% in the current year. The company's shares fell 5.4% to 167.4p at 10:07 BST.

Halfords' shares have more than tripled since mid-March as investors have bet that demand for bikes would transform its prospects as commuters opt for two wheels instead of using crowded public transport. The government has announced a range of measures such as extra bike lanes and vouchers for bike repairs to encourage cycling in the wake of the Covid-19 crisis.

The company said it expected demand for bikes and maintenance to stay strong and that it had seen a pickup in motor products as people make improvements to cars for commuting. But Halfords said the outlook was uncertain and that bikes were not as profitable as motor sales, traditionally its biggest business.

"Although trading has been ahead of the scenario we shared on 25 March 2020, we remain cautious on the months ahead," Halfords said. "It seems likely that our mix will remain biased towards cycling and away from motoring in the short term. Although this tailwind is welcome, cycling is a lower margin, more capital-intensive segment than motoring and, as such, the incremental benefit to group profit will be lower."

Russ Mould, investment director at AJ Bell, said: "No matter how hard it tries, Halfords always struggles to convince the market that it is capable of doing well. As a retailer in demand during lockdown, Halfords should be feeling confident about its near-term and medium-term prospects. However, failing to provide earnings guidance sends a weak signal."



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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

Halfords Group Market Data

Currency UK Pounds
Share Price 160.50p
Change Today -0.40p
% Change -0.25 %
52 Week High 234.00
52 Week Low 147.10
Volume 747,167
Shares Issued 218.93m
Market Cap £351.38m
RiskGrade 239

Halfords Group Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
83.16% above the market average83.16% above the market average83.16% above the market average83.16% above the market average83.16% above the market average
73.68% above the sector average73.68% above the sector average73.68% above the sector average73.68% above the sector average73.68% above the sector average
Price Trend
40.8% below the market average40.8% below the market average40.8% below the market average40.8% below the market average40.8% below the market average
36.59% below the sector average36.59% below the sector average36.59% below the sector average36.59% below the sector average36.59% below the sector average
Income
69.95% above the market average69.95% above the market average69.95% above the market average69.95% above the market average69.95% above the market average
77.78% above the sector average77.78% above the sector average77.78% above the sector average77.78% above the sector average77.78% above the sector average
Growth
67.23% below the market average67.23% below the market average67.23% below the market average67.23% below the market average67.23% below the market average
20% below the sector average20% below the sector average20% below the sector average20% below the sector average20% below the sector average

What The Brokers Say

Strong Buy 2
Buy 1
Neutral 1
Sell 1
Strong Sell 1
Total 6
neutral
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

Halfords Group Dividends

  Latest Previous
  Interim Final
Ex-Div 14-Dec-23 10-Aug-23
Paid 19-Jan-24 15-Sep-23
Amount 3.00p 7.00p

Trades for 28-Mar-2024

Time Volume / Share Price
16:58 150,000 @ 160.60p
16:35 167,568 @ 160.50p
16:35 1 @ 160.50p
16:35 1,821 @ 160.50p
16:35 964 @ 160.50p

Halfords Group Key Personnel

CEO Graham Stapleton
CFO Jo Hartley

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