Halfords shares accelerate after motor retailer ups profit guidance
Halfords shares accelerate after motor retailer ups profit guidance
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Halfords shares soared after the motor and cycling retailer lifted profit guidance in response to a rebound in trade over Christmas and lower costs. The Redditch-based firm observed positive like-for-like turnover growth in both its retail and autocentres businesses over the third quarter, with Halfords citing a boost from cold weather.
Halfords also told investors on Tuesday it had seen weaker than expected FX headwind and freight costs, and the group is on track to 'exceed' its £30million annual savings target. Britain's largest cycling and motor services retailer expects to make between £32million and £37million in underlying pre-tax profits this financial year, compared to analyst consensus of £28.3million.
Halfords Group shares jumped by more than 19 per cent on Tuesday morning before retreating to a 15.1 per cent gain at 145p by 9am, making them the FTSE All-Share Index's biggest riser. Yet the firm's shares are still around 17 per cent down on 12 months ago, having taken a dive after a profit warning last February.
A rollout of its Fusion Motoring Services strategy, which seeks closer relationships between retail and autocentre divisions within a town, led to services, maintenance and repair sales in consumer garages expanding by 10.3 per cent. Meanwhile, comparable retail revenues grew by 13.1 per cent in December due partially to greater promotional activity and festive gifting of cycling-related goods.
