Halfords cheered by late pick-up in sales of bicycles

Halfords rode out the storm in the retail sector yesterday after bicycle sales picked up pace during solid Christmas trading.

The car parts and leisure goods firm, which has 460 stores in the UK and Ireland, upgraded its full-year profit guidance after like-for-like retail sales increased 0.4 per cent in the 15 weeks to January 11.

Overall bike sales were down 1.6 per cent on a same-store basis but premium brands, such as Carrera and its range from Olympic cyclist Chris Boardman, were up 33 per cent and offset a “disappointing” start to Christmas.

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The group also announced yesterday it is to add Pinarello, the brand ridden by Team Sky and winner Bradley Wiggins in the Tour de France, to its line-up.

Following the sales performance, the group said it expected pre-tax profits in the year to the end of March to be between £68m and £72m, compared with previous expectations of £66m to £70m.

But retail sales at the group have still slowed from a bumper second quarter, when demand was boosted by British success in the Tour de France and Olympics.

Chief executive Matt Davies, the former Pets at Home boss who joined the group in October, said it was a “satisfactory performance in tough conditions.”

He added: “Cycling sales initially disappointed but performed more strongly as the holiday period progressed and we were particularly pleased that momentum has been maintained in sales of premium cycles.”

Car maintenance sales provided the strongest performance in the Christmas period, with sales up 13.2 per cent on a year earlier.

Continued investment in new centres to provide services such as MOTs and car repairs helped Halfords’ autocentres division post a 12.4 per cent jump in revenues.

The group also said a record 11 per cent of retail revenues had come online.

Kate Calvert, retail research analyst at Seymour Pierce, said there was a limit to how much the new chief executive could have influenced the third quarter, but she had noticed sharper direct marketing and website improvements.

She said that while there was still much for management to do, the improved second quarter and the results showed the core retail business was “sound”.