UK retailer Halfords first half profit slumps

LONDON (Reuters) – British bicycles-to-car-parts group Halfords posted a 23 percent slump in first half profit as a better second quarter sales performance failed to offset a poor start to the year.

The firm, which trades from over 460 Halfords stores in the UK and Ireland as well as over 260 Autocentres, said on Wednesday it made a pretax profit before one off items of 41.9 million pounds ($66.7 million) in the 26 weeks to September 28.

That was in line with company guidance of 40-42 million pounds issued last month but down from 54.7 million pounds made in the same period last year.

First half sales rose 0.4 percent to 455.6 million pounds, with a weather-impacted first quarter fall in sales at stores open over a year of 5.6 percent reversing to a rise of 5.6 percent in the second quarter, as demand for bikes rose on the back of Britain’s success in the Tour de France and Olympics.

British retailers are mostly struggling as consumers hold back spending in the face of job insecurity, rising prices, subdued wages growth and government austerity measures.

Halfords, which last month appointed Matt Davies, the former Pets at Home boss, as its chief executive, said its second-half planning assumptions were unchanged and it maintained full-year profit guidance of 66-70 million pounds.

The group ended the period with net debt of 107.9 million pounds and, as expected, is paying an unchanged interim dividend of 8 pence a share.

Shares in Halfords, up 45 percent over the last three months, closed Tuesday at 345 pence, valuing the business at 387 billion pounds. ($1 = 0.6284 British pounds)


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