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Pre-Close Trading Statement
Halfords Group plc, the UK's leading retailer of automotive/leisure products and operator in auto servicing issues the following trading update for the second quarter and first half-year ended 30 September.
| Revenue Analysis1. | 13 Weeks to 30 September 2011 | 26 Weeks to 30 September 2011 | ||
| LfL % | Total % | LfL | Total % | |
| Car Maintenance | -3.3 | -2.8 | -3.1 | -2.5 |
| Car Enhancement | -8.9 | -8.5 | -9.8 | -9.2 |
| Leisure | +1.5 | +2.2 | +3.9 | +4.7 |
| Retail | -2.8 | -2.0 | -1.9 | -1.2 |
| Autocentres | +3.1 | +10.6 | +2.7 | +9.0 |
| Group total | -0.6 | -0.1 | ||
Q2 HIGHLIGHTS
- Cycling LFL sales up 5.7%
- Wefit penetration of bulbs, wiper blades and batteries (3Bs) increases to 22.1% compared to 20.2% in Q2 last year
- Online sales penetration 8.4%
- Autocentre sales growth of +10.6% with LFLs +3.1%
FIRST HALF
RETAIL
In a tough market we are creating value for customers through the
price, quality and innovation of products and our expert service,
as well as retaining a clear focus on costs and cash margins. We
also continue to invest appropriately where we believe we can make
returns.
In the first half, overall Retail sales declined by 1.2% and by 1.9% on a like for like basis.
In Leisure, cycling sales have continued to grow, boosted by the launch of the new range of Carrera in July and strong sales of accessories.
Whilst Car Maintenance remains subdued, sales of Halfords range of wefit services continue to grow. In Car Enhancement we again increased market share in both In-Car Audio and Sat Nav.
Full Year gross margin guidance of at least 100bps year on year decline and operating cost guidance remain unchanged.
AUTOCENTRES
Halfords Autocentres revenues continued on a positive and improving
trend as we helped motorists with quality service at more
affordable prices. Total sales grew 9.0% over the half and like for
like sales are up 2.7%. In particular we have seen strong demand
for servicing and tyres.
Against a background of strong growth, we continue to invest in developing the business. This activity plus expected start-up losses from the opening programme means that first half operating profits for Autocentres will be below last year. We launched six new centres in the first half and we expect to significantly accelerate openings during in the rest of the year.
PROFIT BEFORE TAX
Group profit before tax for the first half is expected to be in the
range of £53 - £55 million.
BALANCE SHEET AND CASH
The business is cash generative, pays material dividends and
remains in a sound financial position. In line with our intention
to improve year on year availability, our inventories at the half
year will be higher than the prior year. Net debt for the half year
is expected to be around £145 million. To date we have
purchased 13.8 million shares for £48.6 million at an average
price of 353.2 pence per share through our share buyback
programme.
David Wild, Chief Executive Officer,
commented:
"The tough consumer environment which particularly affects
motorists is continuing to influence spending patterns. We are
taking constructive steps to protect our sales and profitability by
delivering real value and service to our customers. There are clear
signs that this strategy has had a positive impact in our stores
through the summer and we are particularly pleased with the growth
in cycles and fitting services.
Our autocentres have shown impressive revenue growth, counter to the trend in the sector. This demonstrates how the Halfords brand is gaining traction in aftercare and justifies the long-term investments we are making.
We are carefully managing all aspects of our business to deliver optimal performance for customers and investors alike in these harsh times."
End
1.Notes
The information in this announcement is based on unaudited
management accounts information.
- Like-for-like sales represents
revenues from stores or Autocentres trading for greater than 365
days
- Revenues denominated in foreign
currencies have been translated at constant rates of
exchange.
- Retail and Group revenues exclude
£1.9m of revenues from Central Europe in H1 FY11.
- The sales benefit within Retail,
from the timing of Easter, is estimated to be around 60bps for the
first half.
Analysts Call
There will be an analysts' call today at 8.30am
Dial in details are:
Participant dial-in: 0800 368 1986
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There will be a playback facility available until midnight on
Wednesday 12 October.
To access this, the details are:
Replay Access Number:
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Replay Access
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| Enquires: Analysts: |
|
| Halfords Group plc | On the day number |
| Andrew Findlay, Finance Director | +44 (0)207 379 5151 (On the day) |
| Louise Richardson, Interim Investor Relations Officer | +44 (0)1527 513113 (thereafter) |
| Media: Maitland |
|
| Neil Bennett | +44 (0)207 379 5151 |
| Richard Farnsworth | +44 (0)207 379 5151 |
Financial Calendar
Halfords will announce its Interim Results for the 26 weeks ended
30 September 2011 on 10 November 2011.
Notes to Editors:
www.halfords.co.uk
www.halfordscompany.co.uk
www.halfordsautocentres.co.uk
Halfords Group plc
The Group is the UK's leading retailer of automotive, leisure and
cycling products and through Halfords Autocentres also the UK's
leading independent car servicing and repair operator.
Halfords customers shop at 466 stores in the UK and Republic of
Ireland and at halfords.com
for pick-up at their local store or direct home delivery. Halfords
Autocentres now operates from 246 sites nationally and offers
motorists dealership quality MOTs, repairs and car servicing at
affordable prices.
Halfords employs approximately 11,000 staff and sells over 14,000 different product lines with significant ranges in car parts, cycles, in-car technology, child seats, roof boxes, outdoor leisure and camping equipment. Halfords own brands include the in-store Bikehut department, for cycles and cycling accessories, Apollo and Carrera cycles and exclusive UK distribution rights of the premium ranged Boardman cycles and accessories. In outdoor leisure, we sell a premium range of camping equipment, branded URBAN Escape. Halfords offers customers expert advice and a fitting service called "wefit" for car parts, child seats, satellite navigation and in-car entertainment systems, and a "werepair" service for cycles.
Cautionary Statement:
This report contains certain forward-looking statements with
respect to the financial condition, results of operations, and
businesses of Halfords Group plc. These statements and forecasts
involve risk, uncertainty and assumptions because they relate to
events and depend upon circumstances that will occur in the future.
There are a number of factors that could cause actual results or
developments to differ materially from those expressed or implied
by these forward-looking statements. These forward-looking
statements are made only as at the date of this announcement.
Nothing in this announcement should be construed as a profit
forecast. Except as required by law, Halfords Group plc has no
obligation to update the forward-looking statements or to correct
any inaccuracies therein.