Halfords has warned that cycling sales have plummeted in its second quarter to date, but bosses remain confident it will meet profit forecasts.
- Halfords cycling sales fall 11% in second quarter to date
- ‘Disappointing’ performance offset by growth in other categories
- Bosses remain “confident” of future growth opportunities in cycling
Cycling sales for the eight-week period to August 28 slumped 11% against “tough comparatives”. Halfords said sales are expected to be below market expectations for the quarter, driven down by a fall in sales of mainstream bikes.
But the retailer said trading in all other categories “remains robust”, with “disappointing” cycling sales offset by 7.3% growth in car maintenance and a 4.7% rise in car enhancement sales. Halfords said that performance meant the group’s pre-tax profit would be “broadly in line” with expectations.
In an unscheduled trading update, Halfords said the falling cycling sales was “principally market-driven reflecting greater levels of discounting”. It added that poor weather had also deterred casual cyclists, although its cycle repair division reported 27.6% growth during the eight-week period.
“This recent weakness in our cycling sales is disappointing, but it comes after two years of very strong growth in the category”
Jill McDonald, Halfords
The retailer said it remains “confident in the medium and long-term growth opportunities in the cycling market” and insisted it would launch “a complete refresh of children’s bikes and accessories” alongside “a series of compelling offers for customers”.
Halfords chief executive Jill McDonald said: “In my first three months at Halfords I have reviewed all aspects of the group and it is clear to me that Halfords is a strong business with a well-balanced portfolio of product and service categories, talented colleagues and considerable growth potential.
“This recent weakness in our cycling sales is disappointing, but it comes after two years of very strong growth in the category and has been partly offset by strong growth in both car maintenance and car enhancement sales, which is a testament to the balanced nature of the business.
“Looking ahead, we remain confident in the long-term growth opportunities in cycling and I will talk more about our plans for cycling and across the broader group at our interim results in November.”
Halfords will report its interim results and a strategy update on November 12.