(Alliance News) - Halfords Group PLC on Thursday posted a rise in annual earnings, as the Redditch, Worcestershire-based car and bicycle products retailer benefited from the cycling boom during the Covid-19 pandemic.
For the financial year that ended April 2, revenue rose 12% to GBP1.29 billion from GBP1.16 billion last year, and pretax profit surged to GBP64.5 million from GBP19.4 million.
Positive momentum has continued into the new financial year, with two-year like-for-like growth rates for first nine weeks of 6.6% for Retail Motoring, 42% for Retail Cycling, and 6.6% for Autocentres.
Halfords noted supply challenges for cycling products, and it plans to address a challenging economic outlook with "significant investment" in Retail Motoring pricing, meaning discounts.
"Although this may impact FY22 gross margins, we are confident it will strengthen the business in the medium and long term. After the strong start to the year, and in consideration of these factors, we are targeting FY22 profit before tax, including IFRS 16 adjustments, of above GBP75 million," Halfords says.
The company declared a final dividend of 5.00p, having paid nothing for financial 2020. Halfords said it has positive on outlook for financial 2022 and plans a full-year dividend of 9.00p.
"Demand for our services remains strong in the new financial year, and our touring categories are currently performing particularly well given the trend towards staycations this summer. In the longer-term, we remain confident in the future prospects for the UK's motoring and cycling markets and our ability to compete strongly in both," said Chief Executive Graham Stapleton.
Halfords shares were up 2.6% at 416.51 pence on Thursday, though they dipped as low at 383.24p in early dealings. The stock is up 56% so far in 2021.
By Lucy Heming;Â lucyheming@alliancenews.com
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Halfords (HFD)