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Halfords to repay furlough money as profits upgrade revealed

·1 min read
Halfords is on track to report better than expected profits (Halfords)
Halfords is on track to report better than expected profits (Halfords)

Halfords will repay furlough money, the bike retailer said on Monday as it revealed profits will be ahead of expectations.

The motoring and cycling products retailer said although it has experienced a volatile trading environment across the first seven weeks of the fourth quarter, the overall performance has been stronger than anticipated.

Cycling comparable sales growth over the period jumped 43%, as people continue to take to bikes during lockdowns. The chain said kids and adult mechanical bikes are in demand, and it also saw growth from its performance cycling business, Tredz.

Halfords, which has been able to stay open during lockdowns, now expects full-year pretax profit to be within the range of £90 million to £100 million.

Analysts had pencilled in around £71 million.

In the firm’s third quarter update in January it had pointed to a weaker like-for-like growth rate as it exited that three month period. That was due to regional lockdowns impacting motoring demand, as well as global container shortages and port disruption delaying stock arriving.

The chain today said that for the first seven weeks of the fourth quarter, comparable sales growth is 6.2% higher.

Cycling has seen sales growth rates improve as supply disruption has eased, although Halfords said “overall supply remains sub-optimal”.

The firm, led by Graham Stapleton, will repay £10.7 million of furlough income received, and the profit range is after this repayment.

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