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Halfords has reported a 3.9% drop in revenues for the 20-week period ending 16 August, after it revealed “wetter weather” and “weak consumer confidence” impacted sales.
Like-for-like revenue at a group level declined by 3.2% in the period, with retail sales falling 3.9% and motoring by 5.9%. Halfords said while sales growth was weaker than expected, the impact of which has been “partially mitigated” by stronger margins and tight cost control.
It added that, at this point in time, the impact of the “uncertain economic environment” remains an “ongoing risk to big-ticket discretionary purchases” in the second half. In light of this, Halfords said it remains focused on improving gross margins and managing the cost base.
As a result the company said it anticipates FY20 underlying profit before tax to be within the range of £50m to £55m.
Graham Stapleton, chief executive of Halfords, said: “Despite sales growth in group services, online and B2B, we have seen our overall sales impacted by cooler, wetter weather and weaker consumer confidence year-on-year. The market has been challenging but we are pleased to have seen increased market share in our core categories.
“In the second half, we believe the economic and political uncertainty will continue to impact big-ticket discretionary spend and, therefore, as in the first half, we will continue to focus on improving gross margins and controlling costs.”
He added: “We set out a new strategy for the business last year and while it is still early, we have already seen encouraging signs of progress. We remain confident that it is the right strategy to drive the sustainable growth of the business.”
