Halfords H1 profits fall to £29m amid ‘softening’ trade

Halfords has reported that underlying profit before tax fell by 49.9% to £29m in the first half of the year, down from £57.9m the prior year, despite a “resilient” performance in the period.

The group also downgraded its full-year guidance after a “softening” of trading in discretionary areas of spend, with full-year profit now expected to be at the lower end of its £65m to £75m guidance. 

Nonetheless, it experienced a total revenue growth of 10.2% in H1, with revenues rising from £765.7m, up from £694.8m the year before. 

The company also maintains that its segments delivered like-for-like growth over the past three years, with autocentres increasing 30%, retail motoring 10.2% and cycling 8.6%. 

Following this increase in service demand, Halfords has also announced a recruitment drive to fill 1,000 new automotive technician roles in the next 12 months. 

Service-related sales reportedly represented 42.6% of the retailer’s revenues in the period and are expected to reach around 48% of sales on an annualised basis following the acquisition of Lodge Tyre. 

Graham Stapleton, CEO of Halfords, said: “This has been a period of strong strategic progress and resilient financial performance for Halfords. In such a volatile macroeconomic environment, our strategy of focusing on the kind of predictable and recurring revenue that comes from motoring services and needs-based products has never been more relevant. 

“The success of our Motoring Loyalty Club is exceeding our expectations, as customers continue to be attracted by a range of discounts and offers that are aimed at helping motorists across the UK with the rocketing cost of running and maintaining a car.” 

He added: “In order to help meet that demand, we are today launching a recruitment drive to fill 1,000 new automotive technician roles over the next 12 months. In particular, we are hoping to attract retirees back into the workforce, as well as increasing the number of women in technician roles.”