Halfords has reported flat sales in the first half of the fiscal year, citing cautious consumer spending in anticipation of the Autumn Budget.
- The company’s like-for-like sales were broadly stagnant, with a slight decrease of 0.1% compared to a strong performance last year.
- Retail sales saw a 0.7% dip, partially due to adverse weather affecting its cycling segment and challenging market conditions.
- Halfords Autocentres, a key component of its business, experienced a modest 0.8% increase in like-for-like sales, driven by services, maintenance, and repair growth.
- Despite the challenging environment, Halfords remains committed to its ‘Fusion’ concept strategy aiming for long-term growth.
Halfords has announced its sales figures for the first half of the 2024 fiscal year, revealing flat like-for-like sales, which dipped by 0.1% over the 26 weeks to 27 September. This stagnation comes in stark contrast to the 8.3% sales increase the company enjoyed in the previous year. The firm has attributed some of this flat performance to consumers’ cautious approach to discretionary spending, spurred by uncertainties surrounding the upcoming Autumn Budget.
In this period, retail sales specifically declined by 0.7%. Halfords identified contributing factors such as ‘the UK’s wettest spring since 1986’, combined with a notably ‘challenging’ performance in its cycling business as significant hurdles. The adverse weather conditions not only hampered cycling sales but also seemed to reflect broader market challenges, impacting overall consumer spending patterns.
Despite the obstacles in its retail division, Halfords Autocentres, which represent 40% of the group’s operations, experienced a slight increase of 0.8% in like-for-like sales. The growth in this sector was primarily attributed to robust demand in services, maintenance, and repair functions, underscoring the resilience and importance of this segment within Halfords’ business model.
CEO Graham Stapleton expressed cautious optimism about the company’s position and strategic direction. He remarked, ‘While consumers remain cautious in their discretionary spending compounded by uncertainty around the contents of the upcoming Autumn Budget, we have continued to focus on controlling the controllables and I am pleased with our performance in the first half of FY25.’ Stapleton highlighted the company’s ability to absorb inflationary pressures amounting to over £130m since FY20 while maintaining a strong balance sheet.
In alignment with its strategic initiatives, Halfords continues to advance its ‘Fusion’ concept strategy, focusing on enhancing retail car park services, expanding training across its workforce, and empowering staff to offer comprehensive solutions to all customers. The commitment to these long-term strategies illustrates Halfords’ aim to optimise its existing platform, gaining immediate returns while positioning itself for future growth.
Halfords remains focused on strategic optimisation and investment despite a challenging consumer spending environment.
