Halfords Group PLC (HFD) 
Preliminary Results: Financial Year 2020 
 
07-Jul-2020 / 07:00 GMT/BST 
Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 
(MAR), transmitted by EQS Group. 
The issuer is solely responsible for the content of this announcement. 
 
7 July 2020 
 
Halfords Group plc 
 
Preliminary Results: Financial Year 2020 
 
Underlying profit+ exceeded guidance: a strong operating performance, with gross margin improvements and tight cost 
control. Strategic focus on motoring services led to +18.8% growth in Autocentres revenue 
 
Halfords Group plc ("Halfords" or the "Group"), the UK's leading provider of Motoring and Cycling products and services, 
today announces its preliminary results for the 53 weeks to 3 April 2020 ("the period"). To aid comparability, all numbers 
shown are before adopting IFRS 16, before non-underlying items and on a 52-week basis, unless otherwise stated. 
 
Group financial summary 
 
                     FY20       FY20       FY19       52-week 
                                                      change 
 
                  (53 weeks) (52 weeks) (52 weeks) 
 
                     GBPm         GBPm         GBPm 
Revenue            1,155.1    1,142.4    1,138.6       +0.3% 
Retail              961.0      950.6      977.2        -2.7% 
Autocentres         194.1      191.8      161.4       +18.8% 
Gross Margin        51.1%      51.1%      50.9%       +27bps 
Retail              48.2%      48.2%      48.0%       +20bps 
Autocentres         65.4%      65.5%      68.0%       -250bps 
Underlying           92.6       95.3       98.2        -3.0% 
EBITDA* 
Underlying Profit    52.6       55.9       58.8        -4.9% 
Before Tax 
("PBT")* 
Net                 (32.1)     (32.1)     (7.8) 
Non-Underlying 
Items, pre-IFRS 
16 
Impact of           (1.1)      (1.1)        - 
Adopting IFRS 16 
Profit Before        19.4       22.7       51.0       -55.5% 
Tax, after impact 
of IFRS 16 
Underlying Basic    22.9p      24.3p      24.5p        -0.8% 
Earnings per 
Share* 
 
+Before IFRS 16, before non-underlying items and on a 52-week basis. *Alternative performance measures are defined and 
reconciled to IFRS amounts in the glossary on page 18. 
 
Key Highlights 
 
· Underlying PBT was GBP55.9m, ahead of guidance despite the late impact of COVID-19. Excluding acquisitions and the 
impact of COVID-19, underlying PBT would have been in line with last year. 
 
· In Retail: 
 
· Overall sales were -2.7% (-2.3% LFL) lower than last year, with a strong Cycling performance not fully offsetting a 
tough market for Motoring products. 
 
· Cycling sales grew +2.3%, boosted by our H1 investment in store merchandising and bike ranges, improving both the 
customer experience and the financial returns of the category. 
 
· In Motoring, we continued to take market share in core categories, but sales of big-ticket discretionary products 
and winter items were weaker. Despite the very mild winter, sales of 3Bs ("Bulbs, Blades, Batteries") grew over the 
full year, demonstrating the strength of our related services offer. 
 
· Autocentres revenue grew +18.8% (+1.4% LFL), boosted by the acquisitions of McConechy's and Tyres on the Drive 
("ToTD") in H2. The underlying Autocentres business, excluding acquisitions, continued to make good progress on its 
strategic execution, increasing EBIT by over +40% year-on-year to GBP7.8m. 
 
· Group gross margin improved by 27bps, with underlying improvements more than offsetting the dilutive impact of 
acquisitions. 
 
· Operating costs were tightly controlled, reducing by -0.5% year-on-year excluding acquisitions. Our strong focus on 
efficiency and procurement savings outweighed inflationary pressures and strategic investments. 
 
· Strong cash generation maintained, with Free Cash Flow of GBP54.6m, having delivered further improvement on working 
capital, which on average was GBP10.6m lower than last year. Net debt was GBP73.2m, GBP8.6m lower than last year and 0.8x 
underlying EBITDA. 
 
· Non-underlying items were GBP32.1m, the majority of which related to the previously announced exit of Cycle Republic. 
 
Graham Stapleton, Chief Executive Officer, commented: 
 
"This has been another year of good progress against the backdrop of a retail market that was challenging even before the 
emergence of the COVID-19 pandemic. We are particularly pleased to have delivered strong revenue growth in Group Services 
(+9%), Online (+17%) and B2B (+25%), which are our main areas of strategic focus. Our Autocentres business grew strongly, 
boosted by the acquisitions of both McConechy's and Tyres on the Drive, and more broadly in motoring services we expanded 
our fleet of Mobile Expert vans from 3 to 75. This was particularly timely given strong demand for at-home services. 
 
The start of the current financial year has of course been dominated by the impact of COVID-19, and our status as an 
essential retailer was a clear endorsement of the wider role that Halfords has to play in keeping the UK moving. Having 
responded quickly and decisively to cater for the surge in popularity of cycling during lockdown, we are now seeing 
increased demand for motoring services and products as people start using their cars regularly again having not done so 
for the last few months. 
 
Despite the wider uncertainty caused by COVID-19, we remain confident in the long-term prospects for Halfords given the 
strong macro tailwinds within our market-leading Motoring and Cycling businesses. The strong progress we have made in FY20 
and in the first quarter of FY21 has been made possible by the hard work and dedication of our thousands of colleagues, 
who I am proud to work alongside". 
 
Current trading and liquidity update 
 
Halfords is classified as an essential retailer by the UK Government and, as such, has continued to trade despite the 
COVID-19 pandemic. For the majority of the first quarter of the current financial year ("the period"), we have operated 
from a reduced Retail estate on a 'dark-store' basis, serving customers at the store entrance to ensure both colleague and 
customer safety. We have gradually increased the number of 'dark stores' open during April and May and converted some of 
these to 'Lite' stores from 27 May. 'Lite' stores are fully open but limit the number of customers allowed inside at any 
one time to ensure appropriate physical distancing measures. As of 3 July, 359 stores are trading under the 'Lite' format, 
8 under the 'dark-store' format, and 77 remain closed. Autocentres has operated from a reduced number of garages across 
Q1, with open garages increasing during May and June and was fully reopened by 3 July. Significant safety measures have 
been in place throughout the period in both Retail and Autocentres. 
 
Group sales for the 13 weeks to 3 July were -2.8% below last year and -6.5% on a LFL basis, significantly better than 
anticipated in late-March and an improvement on the -23% LFL decline for the four weeks to 1 May that we reported on 6 May 
2020. Sales in our online channel were very strong, up 200% year-on-year in Q1, highlighting the value of the investment 
in our new web platform, which dealt well with the unprecedented shift to online ordering during the COVID-19 lockdown, 
when physical store operations were severely curtailed. 
 
Our Cycling business has performed very strongly throughout the period, up +57.1% on a LFL basis, significantly boosted by 
the avoidance of public transport, favourable weather conditions and increased adoption of cycling as a health and leisure 
activity. The easing of the lockdown has led to the gradual reopening of schools and workplaces, and while public 
transport is avoided and road congestion increases, cycling is becoming an essential way of commuting for many people. For 
consumers with older bikes, which we estimate could amount to 7m in the UK, servicing and repairs have proved an 
inexpensive and popular way to reengage in cycling, with cycling service-related revenue up 41.9% on a LFL basis in the 4 
weeks to 3 July. Alongside mainstream cycling, our performance cycling business, Tredz, has also traded very strongly, up 
87.3% year-on-year on a LFL basis, benefitting from the successful transfer of inventory and customers from our Cycle 
Republic business, which closed in April. 
 
Motoring revenue was down -45.4% LFL, reflecting a material drop in car journeys across the UK impacting this higher 
margin category. We have seen improving trends in Motoring in recent weeks as the lockdown has eased, boosted by the 
performance of stores open for customer browsing in the 'Lite' format. Essential categories performed well after the 
gradual increase of cars on the road, with batteries and battery care products in high demand. 
 
Autocentres revenue was +14.8% higher than last year and -19.2% lower on a LFL basis, but this improved significantly in 
recent weeks as lockdown has eased, motoring journeys have increased and the garage estate has reopened. Despite the 
Government's 6-month extension of MOT expiry dates, we have seen increasing demand in recent weeks for MOTs and related 
servicing and repair, demonstrating the essential nature of these services. Halfords Mobile Expert has seen a record 
number of jobs per day, with more customers opting to have their cars serviced from the safety of their homes. All 75 of 
our vans have been well utilised throughout Q1, delivering record average jobs per day at peak times. 
 
Reflecting the challenging environment, and as previously announced, we have implemented a range of measures to reduce 
costs and preserve cash, including suspending the dividend, reducing goods-not-for-resale spend and making use of the 
 Government's business rates relief and wage support schemes. As of 3 July, we had GBP200m of total liquidity available in 
 our existing RCF and overdraft facilities and GBP10m of cash. Alongside an amendment to existing covenants, we have also 
 secured a further GBP25m of additional funding through the Government's CLBILS scheme, which we consider as contingency 
funding. 
 
Our positive trading performance in Q1 and the additional measures we have taken give us confidence in our ability to 
trade through the pandemic and end the year in a sound financial position. 
 
Outlook 
 
Despite a better than anticipated trading performance in Q1, the uncertainty that currently exists because of COVID-19 
means that we have withdrawn guidance for FY21. Although trading has been ahead of the scenario we shared on 25 March 
2020, we remain cautious on the months ahead. We have developed three trading scenarios to model a range of potential 
outcomes, including the estimated impact on profit and net debt. 
 
The table below shows our updated scenarios for possible revenue outturns in FY21: 
 
LFL revenue growth (YOY%) Scenario 1 Scenario 2 Scenario 3 
Quarter 1                   -6.5%      -6.5%      -6.5% 
Rest of year                -10.5%     -7.5%      -4.5% 
Full year                   -9.5%      -7.5%      -5.0% 
 
We saw a relatively strong performance in Q1, part of which may have been boosted by a pull-forward in cycling sales given 
the customer response to lockdown and favourable weather conditions during the period. We believe cycling demand will 
remain strong throughout the year and we will work hard to supply these unprecedented levels of demand. We expect a shift 
towards commuter bikes, as people return to workplaces and cycling infrastructure improves, and we expect bike servicing 
and repairs to become more in-demand as consumers take advantage of the Government's voucher repair scheme. We also expect 
motoring demand to improve during the year, as car journeys pick-up, workplaces and schools reopen and our retail stores 
can open with fewer safety restrictions in place. The transmission risk of COVID-19 is significantly higher in confined 
indoor spaces, meaning that car journeys will be seen as a safer alternative to public transport and, as winter 
approaches, a more pragmatic and comfortable alternative to cycling and walking. 
 
As lockdown restrictions ease, we expect an improving trend throughout the year, with H2 profitability expected to be 
improved on H1. An economic contraction and low levels of consumer confidence will inevitably dampen demand for 
discretionary products, but we are well positioned to deliver essential and less discretionary products and services in 
both our Retail and Autocentres businesses, demonstrating again the resilience and strength of the Group. 
 
Based on the revenue scenarios above, we estimate the following range of possible profit and net debt outcomes: 
 
FY21, GBPm                   Scenario 1  Scenario 2   Scenario 3 
Underlying Profit Before  -GBP10m to GBP0m   GBP0m to      +GBP10m to 
Tax                                      +GBP10m        +GBP20m 
Net debt                  GBP55m - GBP65m   GBP45m - GBP55m  GBP35m - GBP45m 
 
It seems likely that our mix will remain biased towards cycling and away from motoring in the short-term. Although this 
tailwind is welcome, cycling is a lower margin, more capital-intensive segment than motoring and, as such, the incremental 
benefit to Group profit will be lower. We announced in November 2019 that whilst Cycling remains an important growth 
driver of the Group, we will focus our efforts on improving the profitability and returns of this segment. We have made 
good progress since then and are encouraged by the opportunity that lies ahead. 
 
In each of these scenarios we have forecast a significant reduction in variable and discretionary costs, such that the 
profit differential between the scenarios is driven principally by the sales outturn. In addition to the cost reductions 
assumed, we are working on a more strategic reduction of our cost base to lay a strong foundation for FY22. In all these 
scenarios we have significant liquidity available throughout the financial year. 
 
Clearly this is a time of unprecedented challenge for the retail sector. We are only three months into FY21 and the 
COVID-19 pandemic, and as such the short-term future is very uncertain, but our focus is on preparing the Group for all 
possible outcomes. The scenarios we have laid out are neither guidance or forecasts but are aimed at giving some insight 
into the impact on Group profitability and net debt under different sales outcomes, which are illustrative only. Our 
weekly trading performance informs our decision making, ensuring we remain agile in managing costs, inventory and 
strategic investments. 
 
Whatever the future holds, we remain confident in the long-term prospects of the Group and its ability to adapt to new 
challenges. We have a large and growing Services business, market-leading Motoring and Cycling businesses with strong 
macro tailwinds, and an experienced management team supported by thousands of dedicated colleagues. 
 
For information purposes: Revenue growth across the year 
 
                26      14    12 weeks   52       11    51 weeks 
               weeks   weeks  ended 27  weeks    weeks  ended 20 
               ended           March    ended    ended   March 
                27                       27       20 
              Septemb                   March    March 
                er    ended 3           2020 
                      January  2020 %                     2020 
                      2020 %   change 
                      change                    2020 % 
              2019 %                      %     change 
              change                   change           % change 
TOTAL REVENUE 
     Halfords  -2.9    +4.6     +2.3    +0.3     +4.3     +0.8 
        Group 
       Retail  -3.8    +0.6     -4.9    -2.7     -2.7     -2.2 
  Autocentres  +3.2    +31.2   +36.3    +18.8    +37.6   +19.2 
  LFL REVENUE 
     Halfords  -2.4    +1.3     -4.0    -1.8     -2.4     -1.3 
        Group 
       Retail  -3.1    +0.8     -4.2    -2.3     -2.6     -1.8 
     Motoring  -5.3    -2.7     -8.4    -5.3     -4.6     -4.4 
      Cycling  +0.2    +5.9     +2.2    +2.3     +1.0     +2.1 
  Autocentres  +2.1    +4.6     -2.9    +1.4      0.0     +2.2 
 
Enquiries 
 
Investors & Analysts (Halfords)             +44 (0) 7483 360 675 
 
Loraine Woodhouse, Chief 
Financial Officer 
 
Neil Ferris, Corporate Finance 
Director 
Media (Powerscourt)                         +44 (0) 20 7250 1446 
 
Rob Greening                      halfords@powerscourt-group.com 
 
Lisa Kavanagh 
 
Results presentation 
 
A conference call for analysts and investors will be held today, starting at 09:00am UK time. Attendance is by invitation 
only. A copy of the presentation and a transcript of the call will be available at www.halfordscompany.com [1] in due 
course. For further details please contact Powerscourt on the details above. 
 
Next trading statement 
 
On 8 September 2020 we will report our trading update for the 20 weeks ending 21 August 2020. 
 
Notes to Editors 
 
www.halfords.com www.halfordscompany.com [1] www.boardmanbikes.com [2] www.tredz.co.uk [3] 
 
Halfords is the UK's leading provider of motoring and cycling services and products. Customers shop at 446 Halfords 
stores, 3 Performance Cycling stores (trading as Tredz and Giant), 371 garages (trading as Halfords Autocentres and 
McConechy's) and have access to 75 mobile service vans (trading as Halfords Mobile Expert and Tyres on the Drive). 
Customers can also shop at halfords.com and tredz.co.uk for pick up at their local store or direct home delivery, as well 
as booking garage services online at halfords.com. 
 
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. 
 
Chief Executive's Statement 
 
Operational review 
 
Retail 
 
 Over the full year, Retail revenue of GBP950.6m was -2.3% below last year on a LFL basis. Week 52 of FY20 was materially 
impacted by COVID-19 and, as such, sales up to week 51 were better at -1.8% LFL. 
 
Motoring 
 
Our market share continued to grow in core motoring categories against a backdrop of low consumer confidence and mild 
winter weather. Overall LFL sales declined -5.3% for the full year and -4.4% up to week 51. We performed well in the more 
resilient and less discretionary categories such as 3Bs, which grew +2.4%, Child Safety products, which grew +9.1% as we 
gained share from weaker competitors, and Car Security, which was up +14%. As in Cycling, we continue to innovate, 
successfully introducing a 'weCheck' services offer into the proposition on a free and paid-for basis. 
 
Cycling 
 
Cycling performed strongly in H2, resulting in +2.3% LFL growth for the year and three successive quarters of growth. 
Sales of E-bikes, which were up +45% year-on-year and accounted for nearly 20% of adult bikes, benefited from improved 
merchandising in stores and high customer demand, and Adult Mechanical and Kids bikes also grew over the full year. Our 
own-brand and exclusive ranges of electric bikes, mechanical bikes and scooters offer our customers unrivalled levels of 
choice and value and we continue to bring new and innovative products to the market. We are well positioned to serve the 
increasing demand for these products and, as the largest national provider of cycling services, we are also ready to 
support customers beyond their first purchase. 
 
Retail gross margin 
 
Retail gross margin increased by 20bps with strong progress across both Motoring and Cycling. In line with our strategy to 
improve Cycling profitability, gross margins increased +117bps versus last year, driven by significant improvements in 
adult bikes. In Motoring, gross margin was up +138bps year-on-year, helping to offset the adverse mix impact of lower 
Motoring sales. Our strong margin performance was driven by several factors, including buying efficiencies and better 
focussed promotions. 
 
Retail operating costs 
 
Retail operating costs were well managed and declined -1.5% year-on-year, before the impact of IFRS 16. This was the 
result of a sharp focus on operational efficiency and improved procurement discipline, the benefits of which more than 
offset important strategic investments and ongoing inflationary pressures such as national minimum wage increases. 
 
Autocentres 
 
 Full year Autocentres revenue was GBP191.8m, growing 18.8% year-on-year and +1.4% on a LFL basis. Autocentres was also 
subject to a material COVID-19 impact with sales up to week 51 stronger, at +2.2% LFL. The acquisitions of McConechy's and 
Tyres on the Drive during H2 provide a significant opportunity in the medium term as we successfully integrate these 
 businesses into the Group. The underlying business, excluding the acquisitions, increased EBIT by over 40% to GBP7.8m, the 
third consecutive year of strong profit growth. This reflects the development of an enhanced operating model which also 
led to a significant improvement in customer service scores. 
 
Group Services 
 
Group Services revenue, which comprises fitting and repair services and the associated product, grew +8.9%, representing 
26% of Group sales in FY20. We continued to expand our range of services, adding weCheck and new cycle care services in 
Retail, trialling on-demand fitting in Autocentres, and expanding our Mobile Expert vans from 3 to 75. Growth in Services 
is a critical part of our strategy and our ability to provide these from approximately 900 fixed and mobile locations 
across the UK provides customers with a convenience unmatched by any other UK business. 
 
Online 
 
Group online sales had another very strong year, with revenue growth of +17%, now accounting for 24% of Group sales in 
FY20. Growth was strong before and after the launch of our new Group web platform in February 2020, which provides 
customers with a vastly improved digital experience and, for the first time, gives them access to an integrated services 
offer across mobile, stores and garages through one website. The new web platform coped well with an unprecedented shift 
to online ordering during the COVID-19 lockdown, when physical store operations were severely curtailed. The importance of 
our store network, colleague expertise and services proposition continued to be evidenced by the strength of Click & 
Collect, with over 80% of orders placed on Halfords.com picked up in stores. 
 
B2B 
 
Group B2B sales grew +25% year-on-year and represented 15% of Group sales in FY20. In the past year we have focussed on 
developing deeper relationships with key strategic partners to support growth within our key markets. This has been 
supported by investment in our technology infrastructure to streamline key customer & client processes. We have also 
broadened our proposition range to expand our B2B offering within motoring services. 
 
Progress on strategy in FY20 
 
To Inspire and Support a Lifetime of motoring and cycling 
 
In November 2019 we announced an acceleration of our strategy 'To Inspire and Support a Lifetime of motoring and cycling'. 
We made significant progress against our strategic objectives in FY20, which laid strong foundations to support our 
response to COVID-19 and positioned us well for FY21 and beyond. Notable highlights include: 
 
· Our Group web platform launched as planned in Q4, transforming the digital customer experience and consolidating our 
broad services offer in one website. 
 
· We exited Cycle Republic and the Boardman Performance Centre, enabling us to focus investment on our higher-returning 
mainstream offer in Halfords and our performance cycling proposition in Tredz. 
 
· Continued development of our Halfords Mobile Expert proposition, delivering best-in-class customer service reflected 
by strong Trustpilot scores. The acquisition of Tyres on the Drive increased our mobile hub footprint from 1 to 7 and 
our van footprint from 3 to 75, providing a strong platform for future growth. 
 
· Acceleration of our growth in Autocentres through the acquisition of McConechy's. Through this we acquired one of the 
UK's leading garage chains with 57 sites and 100 vans, establishing strong coverage in Scotland and the North of 
England. 
 
· Completed the upgrade of PACE, our digital operating platform, in all Autocentres garages. PACE puts a tablet in the 
hands of every technician, providing customers with the assurance of quality and enabling our garages to optimise 
resource allocation and labour efficiency. 
 
· Delivered significant cost savings through supply chain efficiencies, Retail productivity programmes, property savings 
and improved procurement practices, and reduced Working Capital by GBP11m on average throughout FY20. 
 
· Strategic buying alliance agreed with Mobivia, a leading player in the European motoring products and services market. 
The relationship, in its early stages, is progressing well. 
 
FY21 strategy focus 
 
In November 2019 we announced an acceleration of our strategy, emphasising the importance of growing our motoring services 
and B2B businesses. The strategy remains absolutely the right direction for Halfords but, given the unprecedented impact 
of the COVID-19 pandemic, we are moderating our near-term plan. COVID-19 has materially changed the retail outlook for the 
coming months and has overshadowed Brexit as the emerging risk. We have therefore adjusted our short-term focus to 
reducing cost and working capital, ensuring our colleagues are engaged in the success of the business and, of particular 
importance, adapting quickly to new customer trends. We will continue to transform the business and develop our customer 
strategy in FY21, but we will put greater emphasis on responding to emerging trends and laying solid foundations for FY22. 
Our areas of focus in FY21 are: 
 
· A stronger emphasis on reducing the operating costs of the Group, including but not limited to: 
 
· an acceleration of the right-sizing of the Group's physical estate that was already underway, with the planned 
closure of up to 10% of the Group's physical estate (across both stores and garages), which includes the 22 Cycle 
Republic stores and 5 Halfords stores and garages that we have already exited this year 
 
· targeted rent reductions reflecting the current market dynamics 
 
· a review of all GNFR contracts and the tendering of several key agreements 
 
· revisiting the costs of our logistics network 
 
· Continuing to grow the profitability and returns of our core categories, particularly Cycling, through buying 
efficiencies, more targeted promotional campaigns and working capital reductions. 
 
· Developing our Halfords-branded customer proposition by continuing to transform our Group web platform and digital 
customer experience. In addition, we will invest in expanding our Services business, leveraging our financial services 
offer and growing our B2B channels. 
 
· Swiftly integrating the acquisitions of McConechy's and Tyres on the Drive, using our best-in-class technology across 
the Services offer. 
 
· Continuing to develop PACE, our digital operating platform in Autocentres, with a view to transferring best practice 
to services delivery in retail and mobile vans. 
 
· Expanding our Mobile Expert vans to under-served parts of the UK, increasing our original target of 100 vans to a 
revised target of 120 vans by the end of FY21. 
 
· Upweighting investment in the engagement and development of our colleagues, ensuring they are strongly engaged in our 
transformation journey. 
 
In FY21, we will be more focussed on delivering the most important initiatives that provide the quickest and most 
attractive returns, whilst building the underlying strength of the business for FY22 and beyond. We are planning for lower 
capital expenditure in FY21, which we now expect to be in the range of GBP20-30m. As trading conditions improve, however, we 
will seek to continue our transformation journey at pace, in line with the current strategy but adjusted for a new post 
COVID-19 world. 
 
Graham Stapleton 
Chief Executive Officer, July 2020 
 
Halfords Group plc's LEI code is 54930086FKBWWJIOB179 
 
Chief Financial Officer's Report 
 
Halfords Group plc ("the Group" or "Group") 
 
Reportable Segments 
 
Halfords Group operates through two reportable business segments: 
 
· Retail, operating in both the UK and Republic of Ireland; and 
 
· Autocentres, operating solely in the UK. 
 
All references to Retail represent the consolidation of the Halfords ("Halfords Retail") and Cycle Republic businesses, 
Boardman Bikes Limited and Boardman International Limited (together, "Boardman Bikes"), and Performance Cycling Limited 
(together, "Tredz and Wheelies") trading entities. All references to Group represent the consolidation of the Retail and 
Autocentres segments. 
 
The "FY20" accounting period represents trading for the 53 weeks to 3 April 2020 ("the financial year"). To ensure a 
meaningful comparison with the prior year, all commentary unless otherwise stated is for the 52-week period ending 27 
March 2020 and is before non-underlying items. The impact of week 53 is described in detail below, explaining that due to 
the exceptional circumstances of COVID-19 the Group made an operating loss in this period. Most of our commentary on 
profit and cost measures is before the impact of IFRS 16, which is stated where relevant. The impact of IFRS 16 is shown 
in the table below and further details of this impact are provided later within this report. The comparative period "FY19" 
represents trading for the 52 weeks to 29 March 2019 ("the prior year"). 
 
Group Financial Results 
 
                           FY20       FY20       FY19    52 week 
 
                        (53 weeks) (52 weeks) (52 weeks) change 
 
                           GBPm         GBPm         GBPm 
Group Revenue            1,155.1    1,142.4    1,138.6    +0.3% 
Group Gross Profit        589.7      584.0      579.0     +0.9% 
Underlying EBIT            55.4       58.7       62.2     -5.6% 
pre-IFRS 16* 
Underlying EBITDA          92.6       95.3       98.2     -3.0% 
pre-IFRS 16* 
Net Finance Costs         (2.8)      (2.8)      (3.4)    -17.6% 
Underlying Profit          52.6       55.9       58.8     -4.9% 
Before Tax pre-IFRS 16* 
Net Non-Underlying        (32.1)     (32.1)     (7.8)    311.5% 
Items 
Impact of Adopting IFRS   (1.1)      (1.1)        -         - 
16 
Profit Before Tax          19.4       22.7       51.0    -55.5% 
Underlying Basic          22.9p      24.3p      24.5p     -0.8% 
Earnings per Share 
pre-IFRS 16* 
 
* This report includes Alternative Performance Measures (APMs) which we believe provide readers with important additional 
information on the Group. A glossary of terms and reconciliation to IFRS amounts is shown on page 18. 
 
The financial year of FY20 was somewhat overshadowed by the ongoing turbulence caused by Brexit and Halfords undoubtedly 
felt the impact of subdued consumer confidence throughout the year. The concluding period of the financial year also saw a 
new and emerging threat - the COVID-19 pandemic. The impact in the closing two weeks of the year was significant with two 
full days of trading lost in week 52, followed by an almost complete lockdown of the UK. Yet despite seeing impacts on 
Group revenues from both, Halfords clearly demonstrated its resilience in delivering underlying Group PBT, pre-IFRS 16 of 
 GBP55.9m. In fact, if it were not for the lost trading in week 52 and the dilutive impacts of acquisitions, the underlying 
Group PBT would have been in line with last year. The business worked hard to mitigate some of the top line revenue 
impacts through gross profit improvements and tight cost control, whilst continuing to deliver on longer term growth plans 
through the acquisitions of Tyres on the Drive ("ToTD") and McConechy's Tyre Services ("McConechy's") in the second half. 
Alongside a strong P&L result we also achieved targeted working capital reductions through more efficient stock management 
and improved creditor days, enabling our longer term growth strategy. That said, whilst the FY20 impact was contained 
within the final two weeks of trading, the pandemic is likely to materially impact the trading environment in FY21, amid 
significant uncertainty on the short-term outlook. 
 
  Group revenue in FY20, at GBP1,142.4m, was up 0.3% and comprised Retail revenues of GBP950.6m and Autocentres revenue of 
 GBP191.8m. This compared to FY19 Group revenue of GBP1,138.6m, which saw Retail revenue of GBP977.2m and Autocentres revenue of 
   GBP161.4m. Group gross profit at GBP584.0m (FY19: GBP579.0m) represented 51.1% of Group revenue (FY19: 50.9%), reflecting an 
increase in the Retail gross margin of 20 basis points ("bps") to 48.2% and decrease in the Autocentres gross margin of 
250 bps to 65.5%. The overall Group gross profit % was impacted by both mix of product and by the acquisitions within 
Autocentres. Retail saw strong improvements in gross margin % compared to FY19, particularly the Cycling segment, but 
benefits were somewhat offset by both weaker winter product results and the relative mix into Cycling. Within Autocentres, 
the underlying business performed well, improving gross profit % by 180 bps, but the overall impact was eroded by the 
acquisitions, which were dilutive in the near-term but offer a good longer term opportunity. 
 
Total operating costs before non-underlying items and pre IFRS-16 saw a modest increase of 1.6% including mid-year 
acquisitions. Excluding these acquisitions, operating costs of the underlying businesses declined -0.5% after a continued 
focus on efficiency and better procurement practices. We worked hard on process efficiency in stores to mitigate National 
Minimum Wage increases. Lease renewal negotiations saw an average decrease of 15% and investments in store infrastructure 
saw energy consumption reduce by close to 20%. Cost and efficiency remain a significant opportunity for the Group and one 
 which will see a greater focus as we move through FY21. Total underlying costs, pre IFRS-16, increased to GBP525.3m (FY19: 
     GBP516.8m) of which Retail comprised GBP404.3m (FY19: GBP410.5m), Autocentres GBP118.9m (FY19: GBP104.2m) and unallocated costs 
  GBP2.1m (FY19: GBP2.1m). Unallocated costs represent amortisation charges in respect of intangible assets acquired through 
business combinations, namely the acquisition of Autocentres in February 2010, Boardman Bikes in June 2014, and Tredz and 
Wheelies in May 2016, which arise on consolidation of the Group. Group Underlying EBITDA pre-IFRS 16 decreased 3.0% to 
    GBP95.3m (FY19: GBP98.2m), whilst net finance costs pre-IFRS 16 were GBP2.8m (FY19: GBP3.4m). 
 
  Underlying Profit Before Tax pre-IFRS 16 for the year was down 4.9% at GBP55.9m (FY19: GBP58.8m). Non-underlying items of 
  GBP32.1m in the year (FY19: GBP7.8m) related predominantly to the closure of Cycle Republic and Boardman Performance Centre, 
as well as costs related to organisational restructure and strategic review. After non-underlying items, Group Profit 
  Before Tax was GBP23.8m (FY19: GBP51.0m). 
 
  After non-underlying items and including IFRS 16, Group Profit Before Tax was GBP22.7m (FY19: GBP51.0m). The impact on the 
Group of adopting IFRS 16 in the period was a GBP1.1m net decrease to Group Profit Before Tax. Further details on the impact 
of IFRS 16 is shown later in this report. 
 
As noted earlier, FY20 was a 53-week year and therefore saw an additional week of trading included in the full year 
results. In a normal operating environment, this would typically result in additional profit of around GBP3m, but the UK 
lockdown announced on the 23rd March due to COVID-19 resulted in an estimated trading loss of -GBP3.3m. Although the Group 
was deemed an essential retailer and continued to trade throughout week 53, sales were materially impacted and as such 
resulted in the loss. At this early stage of the pandemic we operated from a very limited number of stores and garages 
with limited customer interaction due to social distancing. 
 
Retail 
 
                          FY20       FY20       FY19    52 week 
 
                       (53 weeks) (52 weeks) (52 weeks)  change 
 
                          GBPm         GBPm         GBPm 
Revenue                  961.0      950.6      977.2     -2.7% 
Gross Profit             462.8      458.4      469.3     -2.3% 
Gross Margin             48.2%      48.2%      48.0%     +20bps 
Operating Costs         (410.8)    (404.3)    (410.5)    -1.5% 
Underlying EBIT           52.0       54.1       58.8     -8.0% 
pre-IFRS 16* 
Non-underlying items     (29.5)     (29.5)     (8.7)    +239.4% 
Impact of adopting       (1.2)      (1.2)        -         - 
IFRS 16 
EBIT post IFRS 16         21.3       23.4       50.1     -53.3% 
Underlying EBITDA         81.1       82.7       87.1     -5.1% 
pre-IFRS 16* 
 
* This report includes Alternative Performance Measures (APMs) which we believe provide readers with important additional 
information on the Group. A glossary of terms and reconciliation to IFRS amounts is shown on page [**]. 
 
Revenue for the Retail business of GBP950.6m reflected, on a constant-currency basis, a like-for-like ("LFL") sales decrease 
of -2.3%. Total revenue in the year declined -2.7% after the impacts of closed stores are included. The Cycling 
performance was strong, with like-for-like growth of +2.3% rebounding from a slow start to FY20. Motoring finished the 
year with a like-for-like decline of -5.3%. A similar trend prevailed with results improving as the year progressed, but 
it was Motoring that was significantly impacted by the pandemic and lockdown from week 52. 
 
Conversely, cycling demand was boosted by a more health conscious consumer and the avoidance of public transport. The 
Retail Operational Review in the Chief Executive's Statement contains further commentary on the trading performance in the 
year. Like-for-like revenues and total sales revenue mix for the Retail business are split by category below: 
 
           FY20          FY20                FY19 
 
          LFL (%) Total sales mix (%) Total sales mix (%) 
Motoring   -5.3          58.4                60.4 
Cycling    +2.3          41.6                39.6 
Total      -2.3          100.0               100.0 
 
  Gross profit for the Retail business at GBP458.4m (FY19: GBP469.3m) represented 48.2% of sales, 20bps up on the prior year 
(FY19: 48.0%). Underlying gross margin improved more significantly than the headline number, which was diluted by product 
mix into lower margin cycling, and out of the motoring category, alongside gross profit adjustments for IFRS 15. The gross 
margin improvement reflected the significant work carried out over the last 18 months on our sourcing strategy for both 
bikes and motoring products, as well as our work to optimise promotional activity throughout the year. Over the year, 
cycling gross margins improved by 117bps and Motoring by 138bps vs FY19. 
 
The table below shows the average exchange rate reflected in cost of sales along with the year-on-year movement. 
 
                                                FY20      FY19 
 
                                              full year   full 
                                                          year 
Average USD: GBP rate reflected in cost of      $1.33    $1.32 
sales 
Year-on-year movement in rate                   $0.01    $0.03 
 
Retail operating costs before non-underlying items and IFRS 16 were GBP404.3m (FY19: GBP410.5m) a decline of 1.5% on FY19. The 
focus on operational efficiency and procurement continued in FY20 and, as mentioned previously, helped to mitigate a 
challenging market. Our stores saw only modest increases in overall labour costs despite a 4% increase in the National 
Minimum Wage, as we continued with our 'We Operate 4 Less' programme. Rent costs also reduced as the market begins to 
reflect excess supply in the Retail rental market and we continued to negotiate improved lease terms on renewals. These 
initiatives were coupled with capital investments such as LED lighting, which significantly reduced energy consumption 
across the estate. 
 
Autocentres 
 
                          FY20       FY20       FY19    52 week 
 
                       (53 weeks) (52 weeks) (52 weeks)  change 
 
                          GBPm         GBPm         GBPm 
Revenue                  194.1      191.8      161.4     +18.8% 
Gross Profit             126.9      125.6      109.7     +14.5% 
Gross Margin             65.4%      65.5%      68.0%    -250bps 
Operating Costs         (121.4)    (118.9)    (104.2)    +14.1% 
Underlying EBIT pre       5.5        6.7        5.5      +21.8% 
IFRS 16* 
Non-underlying items     (2.6)      (2.6)       0.9     -388.9% 
Impact of adopting        0.1        0.1         -         - 
IFRS 16 
EBIT post IFRS 16         3.0        4.2        6.4      -34.4% 
Underlying EBITDA pre     11.5       12.6       11.1     +13.5% 
IFRS 16* 
 
* This report includes Alternative Performance Measures (APMs) which we believe provide readers with important additional 
information on the Group. A glossary of terms and reconciliation to IFRS amounts is shown on page 18. 
 
  Autocentres generated total revenues of GBP191.8m (FY19: GBP161.4m), an increase of 18.8% on the prior year with a LFL 
increase of 1.4%. Non-LFL revenue in the year included benefits from the acquisitions of both Tyres on the Drive and 
McConechy's Tyre Services in November 2019, alongside existing Autocentres that have been open less than 12 months. 
 
  Gross profit at GBP125.6m (FY19: GBP109.7m) represented a gross margin of 65.5%; a decrease of 250 bps on the prior year. As 
stated earlier, the decrease in gross margin % was solely a result of the acquisitions, which will have a dilutive effect 
before we migrate the product mix to servicing and repair in the future. The underlying business saw its GP% improve 
significantly by +180bps, with the continued development of our PACE Digital Operating Platform aiding buying efficiency 
across garages alongside a marginally lower mix into tyres, which tend to be lower margin. The benefits of later phases of 
PACE also began to be felt in Q4 with the digital operating platform improving resource allocation to jobs. 
 
 Autocentres' Underlying EBITDA before IFRS 16 of GBP12.6m (FY19: GBP11.1m) was 13.5% higher than FY19. Underlying EBIT before 
   IFRS 16 was GBP1.2m (21.8%) higher than FY19 at GBP6.7m (FY19: GBP5.5m). 
 
Portfolio Management 
 
The total number of fixed stores or centres within the Group stood at 843, with a further 75 mobile locations. The 
portfolio of fixed locations as at 3 April 2020 comprised 472 stores (end of FY19: 477) and 371 Autocentres (end of FY19: 
317). Mobile locations grew by 67 vans, increasing coverage of the most in-demand regions within the UK. 
 
The following table outlines the changes in the portfolio over the year: 
 
                       Retail  Centres  Vans 
Relocations               3       1       - 
Leases re-negotiated     20       8       - 
Refreshed                 -       14      - 
Openings/Acquisitions     -       57     67 
Closed                    4       4       - 
 
Within Retail, the focus in year continued to be on re-laying stores to optimise the space allocated to key growth 
categories, including E-mobility. Four retail stores closed on the natural expiration of their leases as it was considered 
more profitable to the Group on consideration of the anticipated sales transfer to other channels and neighbouring stores. 
Although nearly all of our Retail stores continue to trade profitably, the number of lease expiries or breaks under option 
increases significantly within the next five years. Retail will see two-thirds of stores experience optionality within 
five years, allowing for a high degree of flexibility within the estate. 
 
Within Autocentres, one centre was opened and 57 locations acquired in the year. Four were closed, taking the total number 
of Autocentre locations to 371 as at 3 April 2020 (end of FY19: 317). Fourteen Autocentres were refreshed in the year 
(FY19: 8). 
 
With the exception of eight long leasehold and two freehold properties within Autocentres, the Group's operating sites are 
occupied under operating leases, the majority of which are on standard lease terms, typically with a five to 15-year term 
at inception and with an average lease length of under six years. 
 
Net Non-Underlying items 
 
The following table outlines the components of the non-underlying items recognised in the 53 weeks ended 3 April 2020: 
 
                                             FY20   FY19 
 
                                             GBPm     GBPm 
Organisational restructure costs (a)          2.8   6.8 
Group-wide strategic review (b)               1.0   2.4 
One-off royalty income (c)                     -   (1.6) 
Acquisition and investment-related fees (d)   1.9   0.2 
One-off claims (e)                            0.8    - 
Closure costs (f)                            25.6    - 
Net non-underlying items pre IFRS 16         32.1   7.8 
Closure costs (f)                             1.2    - 
Impairment of right-of-use assets (g)         0.9    - 
Net non-underlying items post IFRS 16        34.2   7.8 
 
a) In the current and prior period, separate and unrelated organisational restructuring activities were undertaken. 
 
Current period costs comprised: 
 
· Redundancy and transition costs of GBP1.4m relating to roles which have been outsourced or otherwise will not be 
replaced (FY19: GBP1.5m); and 
 
· GBP1.4m of asset write-offs, principally resulting from the strategic decision to re-platform the Retail and Autocentres 
websites (FY19: GBP5.3m) 
 
b) In the current and prior periods, costs were incurred in preparing and implementing the new Group strategy. 
 
· GBP0.4m of external consultant costs (FY19: GBP2.0m); and 
 
· GBP0.6m of store labour costs, point-of-sale equipment and other associated costs in completing the cycling space re-lay 
across the store estate (FY19: GBPnil). 
 
 Prior period costs also included GBP0.4m of warehouse and distribution costs in order to align our network with the new 
strategy. 
 
c) A one-off royalty income was received in the prior period in relation to the use of a software license. 
 
d) In the current and prior periods, costs were incurred in relation to the investment in McConechy's Tyre Services and 
Tyres on the Drive. Tyres on the Drive acquisition costs comprise GBP1m principally relating to the costs of dual running 
Halfords Mobile Expert and Tyres on the Drive, as well as the write-off of the receivables balance due from Tyres on the 
Drive; and 
 
· GBP0.9m relating to professional fees in respect of the acquisition of McConechy's Tyre Services 
 
· GBP0.2m of costs were incurred in the prior period in relation to the investment in Tyres on the Drive and costs 
relating to a potential acquisition which did not progress. 
 
e) During the year, a provision was created for expected costs of settling an ongoing court case, which was then settled 
during the second half of the period. In addition, a provision of GBP0.6m has been recognised in relation to the audit by 
HMRC relating to the national minimum wage. 
 
f) Closure costs represent costs associated with the proposed closure of the operations of Cycle Republic and the 
Boardman Performance Centre ("Cycle Republic") following a strategic review of the Group's cycling businesses. The 
provision mostly relates to the impairment of right-of-use assets, as well as the impairment of intangible and tangible 
assets and inventories. 
 
g) In light of the ongoing COVID-19 pandemic, the Group has revised future cash flow projections for stores and garages. 
As a result, GBP0.9m incremental impairment has been recognised in relation to garages where the current and anticipated 
future performance does not support the carrying value of the right-of-use asset and associated tangible assets. This 
charge is directly attributable incremental impairment due to COVID-19 and relates primarily to the right-of-use asset 
value. 
 
Finance Expense 
 
 The net finance expense (before non-underlying items and IFRS 16) for the 53 weeks ended 3 April 2020 was GBP2.8m (FY19: 
 GBP3.4m) reflecting lower average levels of net debt throughout the year. 
 
Taxation 
 
  The taxation charge on profit for the 53 weeks ended 3 April 2020 (before IFRS 16) was GBP2.8m (FY19: GBP9.1m), including a 
  GBP4.7m credit (FY19: GBP1.4m credit) in respect of non-underlying items. The effective tax rate of 13.9% (FY19: 17.8%) 
differs from the UK corporation tax rate (19%) principally due to the impact of overseas tax rates, adjustments in respect 
of prior periods now closed with HM Revenue and Customs and the impact of the rate change in deferred tax recognised in 
the balance sheet. 
 
Earnings Per Share ("EPS") 
 
Underlying Basic EPS before IFRS 16 was 22.9 pence and after non-underlying items 8.9 pence (FY19: 24.5 pence and 21.2 
pence after non-underlying items), a 6.5% and 58.0% decrease on the prior year. Basic weighted-average shares in issue 
during the year were 197.0m (FY19: 197.1m). 
 
Dividend ("DPS") 
 
In light of the COVID-19 pandemic and the likely impact on short-term profitability, the Board has taken a series of 
measures to preserve cash, one of which is a suspension of the dividend. The final dividend payment is therefore nil, 
taking the full year ordinary dividend to 6.18 pence (FY19: 18.57p per share). 
 
Capital Expenditure 
 
Capital investment in the 53 weeks ended 3 April 2020 totalled GBP35.8m (FY19: GBP31.0m) comprising GBP31.0m in Retail and GBP4.8m 
  in Autocentres. Within Retail, GBP15.9m (FY19: GBP11.4m) was invested in stores, including store relocations, space 
optimisation and a building management system across one third of the estate to reduce energy consumption. Additional 
 investments in Retail infrastructure included a GBP9.7m investment in IT systems, including development of a new Group 
website. 
 
 The GBP4.8m (FY19: GBP4.7m) capital expenditure in Autocentres principally related to the replacement of garage equipment and 
replacement of fixtures and fittings alongside the development of PACE, our Garage Workflow System. 
 
Inventories 
 
   Group inventory held as at the year-end was GBP173.0m (FY19: GBP173.7m). Retail inventory decreased to GBP168.0m (FY19: 
 GBP172.3m), reflecting reduced stock levels and working capital efficiencies. 
 
Autocentres' inventory was GBP5.0m (FY19: GBP1.4m). The existing Autocentres business model is such that only modest levels of 
inventory are held, with most parts being acquired on an as-needed basis. The increase in inventory related to the 
acquisition of McConechy's Tyre Services Limited who typically hold low levels of tyres. 
 
Cashflow and Borrowings 
 
Adjusted Operating Cash Flow was GBP109.9m (FY19: GBP88.5m). After acquisitions, taxation, capital expenditure and net finance 
  costs, Free Cash Flow of GBP54.6m (FY19: GBP42.7m) was generated in the year. Group Net Debt was GBP73.2m (FY19: GBP81.8m), with 
the Underlying EBITDA ratio at 0.8:1. All these numbers are pre IFRS 16. 
 
Adoption of IFRS 16 "Leases" 
 
The Group has initially applied IFRS 16 "Leases" as at 30 March 2019. A right-of-use asset and a lease liability is 
included on the Consolidated Statement of Financial Position, and depreciation and interest has been charged to the 
Consolidated Income Statement instead of existing rental charges and operating expenses. 
 
Discount rates ranging between 0.76% and 3.94% have been applied based on UK Government Gilt rates of an appropriate 
duration and adjusted by an indicative credit premium. 
 
The Group has adopted the modified retrospective approach. Under this approach, comparative information is not restated 
and the cumulative effect of applying IFRS 16 is recognised in retained earnings at the date of initial application. 
 
A summary of the impact on the Group income statement and balance sheet for the 53 weeks ended 3 April 2020 is as follows: 
 
Impact on the Consolidated Income Statement:   FY20   FY19 
 
                                               GBPm     GBPm 
Operating costs: 
Rent                                           85.8    - 
Depreciation                                  (72.6)   - 
Foreign exchange and impairment                (1.4) 
Net impact on Operating costs                  11.8    - 
Finance costs (interest)                      (10.8)   - 
Net impact on underlying Profit Before Tax      1.0    - 
Non-underlying costs                           (2.1) 
Net impact on Profit Before Tax                (1.1) 
 
The GBP11.8m net impact on Operating costs is comprised of GBP10.9m for Retail and GBP0.9m for Autocentres as shown above. 
 
Impact on the Consolidated Balance Sheet:    FY20   FY19 
 
                                             GBPm     GBPm 
Right-of-use asset                          349.9    - 
Lease liability                            (416.0)   - 
Retained earnings                            25.1    - 
 
Brexit and impact of movements in foreign currency exchange rates 
 
As we have previously explained, the decision of the UK to leave the European Union ("Brexit") presents significant 
uncertainties to the Group as a result of the impact on the wider UK economy. We have previously set out the main areas in 
which we considered Brexit was likely to impact the Group. We reaffirm and update our assessment of these below: 
 
· Impact on exchange rates. The Group buys a significant proportion of its goods in US dollars; between $250m and $300m 
a year. As previously guided, the majority of our US dollar sourcing is for cycling products. 
 
· Prolonged uncertainty over exit terms and continued weakness in Sterling could lead to a slowdown in the UK economy, 
and consequent loss of consumer confidence, impacting trading conditions for the Group. However, Halfords has strong 
positions in fragmented Motoring and Cycling markets, and a service-led offer that differentiates us from our 
competitors, physical and online. Much of our sales are in needs-based categories that are more resilient to 
macroeconomic cycles and our discretionary categories, such as cycling, camping and travel solutions, could benefit from 
an increase in the number of people choosing to stay at home rather than holidaying abroad; a trend that we observed in 
2009. 
 
Principal Risks and Uncertainties 
 
The Board considers the assessment of risk assessment and the identification of mitigating actions and internal control to 
be fundamental to achieving Halfords' strategic corporate objectives. In the Annual Report and Accounts, the Board sets 
out what it considers to be the principal commercial and financial risks to achieving the Group's objectives. The main 
areas of potential risk and uncertainty in the balance of the financial year are described in the Strategic Report of the 
2020 Annual Report and Accounts. These include: 
 
· Business Strategy 
 
-Capability and capacity to effect significant levels of business change 
 
-Stakeholder support and confidence in strategy 
 
-Brands appeal and market share 
 
- Value proposition 
 
· Financial 
 
-Brexit 
 
-Sustainable business model 
 
· Operational 
 
- COVID-19 
 
- IT infrastructure failure 
 
-Skills shortage 
 
-Staff engagement / culture 
 
- Critical physical infrastructure failure (including supply chain disruption) 
 
· Compliance 
 
-Regulatory and compliance 
 
-Service Quality 
 
-Cyber and data security 
 
Specific risks associated with performance include Christmas trading as well as weather-sensitive sales, particularly 
within the Car Maintenance and Cycling categories in the Retail business. 
 
Loraine Woodhouse 
Chief Financial Officer 
7 July 2020 
 
Glossary of Alternative Performance Measures 
In the reporting of financial information, the Directors have adopted various Alternative Performance Measures ("APMs"), 
previously termed as 'Non-GAAP measures'. APMs should be considered in addition to IFRS measurements, of which some are 
shown on page [15]. The Directors believe that these APMs assist in providing useful information on the underlying 
performance of the Group, enhance the comparability of information between reporting periods, and are used internally by 
the Directors to measure the Group's performance. 
 
The key APMs that the Group focuses on are as follows. All numbers are shown pre-IFRS 16 (on an IAS 17 basis) to enable 
comparability with the prior period performance: 
 
1.Like-for-like ("LFL") sales represent revenues from stores, centres and websites that have been trading for at least a 
year (but excluding prior year sales of stores and centres closed during the year) at constant foreign exchange rates. 
 
2.Underlying EBIT is results from operating activities before non-underlying items. Underlying EBITDA further removes 
Depreciation and Amortisation. 
 
3.Underlying Profit Before Tax is Profit before income tax and non-underlying items as shown in the Group Income 
Statement. 
 
4.Underlying Earnings Per Share is Profit after income tax before non-underlying items as shown in the Group Income 
Statement, divided by the number of shares in issue. 
 
5.Net Debt is current and non-current borrowings less cash and cash equivalents, both in-hand and at bank, as shown in the 
Consolidated Statement of Financial Position. 
 
                             FY20         FY20      FY19 
 
                          Pre IFRS 16 Post IFRS 16  GBPm 
 
                             GBPm           GBPm 
Cash & cash equivalents      115.5       115.5       9.8 
Borrowings - current         (1.8)       (83.4)    (18.5) 
Borrowings - non-current    (186.9)     (511.9)    (73.1) 
Net Debt*                   (73.2)      (479.8)    (81.8) 
 
*The statutory 53-week period to 3 April 2020 comprises reported results that are non-comparable to the 52-week period 
reported in the previous period. 
 
6.Net Debt to Underlying EBITDA ratio is represented by the ratio of Net Debt to Underlying EBITDA (both of which are 
defined above). 
 
7.Adjusted Operating Cash Flow is defined as EBITDA plus share-based payment transactions and loss on disposal of 
property, plant and equipment, less working capital movements and movement in provisions; as reconciled below. 
 
                                   FY20         FY20      FY19 
 
                                Pre IFRS 16 Post IFRS 16  GBPm 
 
                                   GBPm           GBPm 
Underlying EBIT                    55.4         67.2      62.2 
Depreciation, amortisation &       37.2        118.7      36.0 
impairment 
Underlying EBITDA                  92.6        185.9      98.2 
Non-underlying operating          (32.1)       (34.2)     (7.8) 
expenses 
EBITDA                             60.5        151.7      90.4 
Share-based payment                 1.0         1.0        0.3 
transactions 
Loss on disposal of property,       2.8         2.8        5.5 
plant & equipment 
Working capital movements          48.7         52.0     (10.4) 
Provisions movement and other      (3.1)       (3.1)       2.7 
Adjusted Operating Cash Flow*      109.9       204.4      88.5 
 
*The statutory 53-week period to 3 April 2020 comprises reported results that are non-comparable to the 52-week period 
reported in the previous period. 
 
8.Free Cash Flow is defined as Adjusted Operating Cash Flow (as defined above) less capital expenditure, net finance 
costs, taxation, exchange movement and arrangement fees on loans; as reconciled below. 
 
                                 FY20         FY20      FY19 
 
                              Pre IFRS 16 Post IFRS 16  GBPm 
 
                                 GBPm           GBPm 
Adjusted Operating Cash Flow     109.9       204.4      88.5 
Capital expenditure             (34.1)       (33.6)    (29.4) 
Net finance costs                (2.4)       (13.2)     (3.1) 
Taxation                        (16.3)       (16.3)    (12.7) 
Exchange movements               (2.5)       (2.0)      (0.3) 
Arrangement fees on loans          -           -        (0.3) 
Free Cash Flow*                  54.6        139.3      42.7 
 
*The statutory 53-week period to 3 April 2020 comprises reported results that are non-comparable to the 52-week period 
reported in the previous period. 
 
Halfords Group plc? 
 
Consolidated Income Statement? 
 
? 
 
??????????????????????????For the 53 weeks to 3 April 2020? 
 
? 
 
? 
 
? 
 
For the period?  ?                   53?weeks to?3 April 2020?           ?        52 weeks to?29 March 2019? 
?                    ?               Before? Non-underlying??     Total? ?         Before? Non-underlying??   Total? 
 
                            Non-underlying??           items?              Non-underlying?           items? 
 
                                      items?        (note 4)?                       items?        (note 4)? 
?                  Notes?                GBPm?              GBPm?        GBPm? ?             GBPm?              GBPm?      GBPm? 
?                    ?                     ?                ?          ? ?               ?                ?        ? 
Revenue?          ?                 1,155.1?               -?   1,155.1? ?        1,138.6?               -? 1,138.6? 
Cost of sales?   ?                  (565.4)?               -?   (565.4)? ?        (559.6)?               -? (559.6)? 
?                ?                         ?                ?          ? ?               ?                ?        ? 
Gross profit?    ?                    589.7?               -?     589.7? ?          579.0?               -?   579.0? 
?                ?                         ?                ?          ? ?               ?                ?        ? 
Operating        2?                 (522.5)?          (34.2)?   (556.7)? ?        (516.8)?           (7.8)? (524.6)? 
expenses? 
?                ?                         ?                ?          ? ?               ?                ?        ? 
?                 ?                        ?                ?          ? ?               ?                ?        ? 
Results from     3?                    67.2?          (34.2)?      33.0? ?           62.2?           (7.8)?    54.4? 
operating 
activities? 
?                 ?                        ?                ?          ? ?               ?                ?        ? 
Finance costs?   5?                  (13.9)?               -?    (13.9)? ?          (3.4)?               -?   (3.4)? 
Finance income?  5?                     0.3?               -?       0.3? ?              -?               -?       -? 
?                ?                         ?                ?          ? ?               ?                ?        ? 
Net finance      ?                   (13.6)?               -?    (13.6)? ?          (3.4)?               -?   (3.4)? 
expense? 
?                ?                         ?                ?          ? ?               ?                ?        ? 
Profit before    ?                     53.6?           (34.2)      19.4? ?           58.8?           (7.8)?    51.0? 
income tax? 
Income tax       6?                   (6.9)?             5.0?     (1.9)? ?         (10.5)?             1.4?   (9.1)? 
expense? 
?                ?                         ?                ?          ? ?               ?                ?        ? 
Profit for the   ?                     46.7?          (29.2)?      17.5? ?           48.3?           (6.4)?    41.9? 
financial period 
attributable to 
equity 
shareholders? 
?                ?                         ?                ?          ? ?               ?                ?        ? 
Earnings per     ?                         ?                ?          ? ?               ?                ?        ? 
share? 
Basic?earnings   8?              22.9p/23.7p                ? 8.9p/8.9p? ?          24.5p?                ?   21.2p? 
per share 
pre/post IFRS 
16? 
Diluted?earnings 8?              22.5p/23.3p                ? 8.8p/8.7p? ?          24.2p?                ?   21.0p? 
per share 
pre/post IFRS 
16? 
?                 ?                        ?                ?          ? ?               ?                ?        ? 
 
? 
 
The notes on pages?25?to?33?are an integral part of these condensed consolidated financial statements.? 
 
*The Group has initially applied IFRS 16 at 30 March 2019, using the modified retrospective approach. Under this approach, 
comparative information is not restated and the cumulative effect of applying IFRS 16 is recognised in Retained earnings 
at the date of initial application (see Note 1).? 
 
Halfords Group plc? 
 
? 
 
Consolidated Statement of Comprehensive Income? 
 
? 
 
For the?53?weeks to?3 April 2020? 
 
?                                   ?                 ?        ? 
?                          ?      53?weeks to?      52 weeks to? 
?                      ?             3 April??        29?March?? 
 
                                         2020?             2019? 
?               Notes?                     GBPm?               GBPm? 
Profit for         ?                     17.5?             41.9? 
the 
period? 
?                  ?                         ?                 ? 
Other              ?                         ?                 ? 
comprehens 
ive 
income? 
Cash flow          ?                         ?                 ? 
hedges:? 
Fair value         ?                       7.9              7.4? 
changes in 
the 
period? 
Change in          ?                        -?            (8.1)? 
fair value 
of 
investment 
? 
Income tax        6?                    (0.7)?                -? 
on other 
comprehens 
ive 
income? 
Other              ?                       7.2            (0.7)? 
comprehens 
ive income 
for the 
period, 
net of 
income 
tax? 
?                  ?                         ?                 ? 
Total              ?                      24.7             41.2? 
comprehens 
ive income 
for the 
period 
attributab 
le to 
equity 
shareholde 
rs? 
?                           ?                         ?        ? 
 
All items within the Consolidated Statement of Comprehensive Income are classified as items that are or may be recycled to 
the Income Statement.? 
 
? 
 
*The Group has initially applied IFRS 16 at 30 March 2019, using the modified retrospective approach. Under this approach, 
comparative information is not restated and the cumulative effect of applying IFRS 16 is recognised in retained earnings 
at the date of initial application (see Note?1).? 
 
? 
 
The notes on pages 25 to 33 are an integral part of these condensed consolidated financial statements.? 
 
? 
 
Halfords Group plc 
 
Consolidated Statement of Financial Position 
 
For the 53 weeks to 3 April 2020 
 
                                 3 April    29 March    30 March 
 
                                    2020        2019        2018 
 
                                         (Restated)# (Restated)# 
                                      GBPm          GBPm          GBPm 
Assets 
Non-current assets 
Intangible assets                  395.7       387.4       393.9 
Property, plant and equipment       83.1        97.3       101.3 
Right-of-use assets                349.9           -           - 
Deferred tax asset                   7.3           -           - 
Investments                            -           -         8.1 
Total non-current assets           836.0       484.7       503.3 
Current assets 
Inventories#                       173.0       173.7       183.8 
Trade and other receivables         53.5        59.1        56.0 
Derivative financial                 8.7         3.2         0.3 
instruments 
Current tax assets                   8.2           -           - 
Cash and cash equivalents          115.5         9.8        27.0 
Total current assets               358.9       245.8       267.1 
Total assets                     1,194.9       730.5       770.4 
Liabilities 
Current liabilities 
Borrowings                         (0.2)      (18.5)      (20.8) 
Derivative financial               (1.1)       (1.4)       (5.4) 
instruments 
Lease liabilities                 (83.2)           -           - 
Trade and other payables         (217.0)     (176.4)     (187.0) 
Current tax liabilities                -       (3.3)       (3.3) 
Provisions                         (9.7)      (15.1)      (11.9) 
Total current liabilities        (311.2)     (214.7)     (228.4) 
Net current assets                  47.7        31.1        38.7 
Non-current liabilities 
Borrowings                       (179.1)      (73.1)      (94.0) 
Lease liabilities                (332.8)           -           - 
Trade and other payables           (1.9)      (28.1)      (31.2) 
Deferred tax liability                 -       (0.1)       (2.7) 
Provisions                         (4.1)       (5.2)       (3.9) 
Total non-current liabilities    (517.9)     (106.5)     (131.8) 
Total liabilities                (829.1)     (321.2)     (360.2) 
Net assets                         365.8       409.3       410.2 
Shareholders' equity 
Share capital                        2.0         2.0         2.0 
Share premium                      151.0       151.0       151.0 
Investment in own shares          (10.0)      (10.0)       (9.4) 
Other reserves                       4.9         1.9       (2.9) 
Retained earnings                  217.9       264.4       269.5 
Total equity attributable to       365.8       409.3       410.2 
equity holders of the Company 
 
*The Group has initially applied IFRS 16 at 30 March 2019, using the modified retrospective approach. Under this approach, 
comparative information is not restated and the cumulative effect of applying IFRS 16 is recognised in Retained earnings 
at the date of initial application (see Note 1). 
 
# See Note 11 
 
The notes on pages 25 to 33 are an integral part of these condensed consolidated financial statements. 
 
Halfords Group plc 
 
Consolidated Statement of Changes in Shareholders' Equity? 
 
For the?53 weeks to 3 April 2020? 
 
?                   ?            Attributable to the equity holders of the Company? 
? 
?                     ?         ?      ?           Other reserves?          ? 
?                     ?         ?                      ?        ?           ?         ? 
 
                           Share? Investment?   Capital? 
?                Share?  premium?     in own? redemption Hedging?   Retained?    Total? 
                                                reserve? 
 
               capital?  account?    shares??            reserve?   earnings?   equity? 
?                   GBPm?       GBPm?         GBPm?        GBPm?      GBPm?         GBPm?       GBPm? 
Balance at?30      2.0?    151.0?      (9.4)?       0.3?   (3.2)?       281.2     421.9 
March?2018? 
Prior year            -         -           -          -        -      (11.7)    (11.7) 
adjustment 
Balance at?30      2.0?    151.0?      (9.4)?       0.3?   (3.2)?       269.5     410.2 
March?2018? 
(restated) 
Impact of            -?        -?          -?         -?       -?       (3.3)     (3.3) 
adoption of 
IFRS 15? 
Adjusted           2.0?    151.0?      (9.4)?       0.3?   (3.2)?       266.2     406.9 
balance 
at?30?March 
2018? 
?                  ?            ?           ?          ?        ?           ?         ? 
Total                 ?         ?           ?          ?        ?           ?         ? 
comprehensive 
income for 
the period? 
Profit for           -?        -?          -?         -?       -?       41.9?     41.9? 
the period? 
Other                 ?         ?           ?          ?        ?           ?         ? 
comprehensive 
income? 
Cash flow             ?         ?           ?          ?        ?           ?         ? 
hedges:? 
Fair value           -?        -?          -?         -?     7.4?          -?      7.4? 
changes in 
the period? 
Changes in           -?        -?          -?         -?       -?      (8.1)?    (8.1)? 
fair value of 
investment? 
Income tax on        -?        -?          -?         -?       -?          -?        -? 
other 
comprehensive 
income? 
Total other          -?        -?          -?         -?     7.4?      (8.1)?    (0.7)? 
comprehensive 
income for 
the period 
net of tax? 
Total                -?        -?          -?         -?     7.4?       33.8?     41.2? 
comprehensive 
income for 
the period? 
Hedging gain         -?        -?          -?         -?   (2.6)?          -?    (2.6)? 
and losses 
and costs of 
hedging 
transferred 
to the cost 
of inventory? 
Transactions          ?         ?           ?          ?        ?           ?         ? 
with owners?? 
Own shares 
acquired? 
Share options        -?        -?      (1.0)?         -?       -?          -?    (1.0)? 
exercised? 
Share-based          -?        -?        0.4?         -?       -?          -?      0.4? 
payment 
transactions? 
Income tax on        -?        -?          -?         -?       -?        0.3?      0.3? 
share-based 
payment 
transactions? 
Dividends to         -?        -?          -?         -?       -?     (35.9)?   (35.9)? 
equity 
holders? 
Total                -?        -?      (0.6)?         -?       -?     (35.6)?   (36.2)? 
transactions 
with owners? 
Balance?at?29      2.0?    151.0?     (10.0)?       0.3?     1.6?       264.4     409.3 
March 2019? 
?                     ?         ?           ?          ?        ?           ?         ? 
 
? 
 
The notes on pages?25 to 33 are an integral part of these condensed consolidated financial statements.? 
 
Halfords Group plc? 
 
Consolidated Statement of Changes in Shareholders' Equity (continued)? 
 
?                  ?           Attributable to the equity holders of the Company? 
? 
?                   ?         ?      ?           Other reserves?          ? 
?                   ?         ?                      ?        ?           ?         ? 
 
                         Share? Investment?   Capital? 
?              Share?  premium?     in own? redemption Hedging?   Retained?    Total? 
                                              reserve? 
 
             capital?  account?    shares??            reserve?   earnings?   equity? 
?                 GBPm?       GBPm?         GBPm?        GBPm?      GBPm?         GBPm?       GBPm? 
Closing           2.0    151.0?      (10.3)       0.3?      1.6       264.4     409.3 
balance at 
29 March 
2019 
(restated) 
Adjustment         -?         -           -         -?       -?      (25.1)    (25.1) 
on initial 
application 
of IFRS 16? 
Adjusted          2.0     151.0      (10.0)       0.3?     1.6?       239.3     384.2 
balance 
at?29 March 
2019? 
?                   ?         ?           ?          ?        ?           ?         ? 
Total               ?         ?           ?          ?        ?           ?         ? 
comprehensiv 
e income for 
the period? 
Profit for          -         -           -          -       -?        17.5      17.5 
the period? 
?                   ?         ?           ?          ?        ?           ?         ? 
Other               ?         ?           ?          ?        ?           ?         ? 
comprehensiv 
e income? 
Fair value          -         -           -          -     7.9?       (2.3)       5.6 
changes in 
the period? 
Income tax          -         -           -          -   (0.7)?       (0.8)     (1.5) 
on other 
comprehensiv 
e income? 
Total other         -         -           -          -      7.2       (3.1)       4.1 
comprehensiv 
e income for 
the period 
net of tax? 
Total               -         -           -          -      7.2        14.4      21.6 
comprehensiv 
e income for 
the period? 
Hedging             -         -           -          -    (4.2)          -?     (4.2) 
gains and 
losses and 
costs of 
hedging 
transferred 
to the cost 
of 
inventory? 
?                   ?         ?           ?          ?        ?           ?         ? 
Transactions        ?         ?           ?          ?        ?           ?         ? 
with 
owners?? 
Share 
options 
exercised? 
Share-based         -         -           -          -       -?         1.0       1.0 
payment 
transactions 
? 
Income tax          -         -           -          -       -?       (0.2)     (0.2) 
on 
share-based 
payment 
transactions 
? 
Dividends to        -         -           -          -       -?      (36.6)    (36.6) 
equity 
holders? 
Total               -         -           -          -       -?      (35.8)    (35.8) 
transactions 
with owners? 
Balance?at?3      2.0     151.0      (10.0)        0.3     4.6?       217.9     365.8 
April 2020? 
 
? 
 
*The Group has initially applied IFRS 16 at 30 March 2019, using the modified retrospective approach. Under this approach, 
comparative information is not restated and the cumulative effect of applying IFRS 16 is recognised in retained earnings 
at the date of initial application (see Note?1).? 
 
** See Note?11 
 
? 
 
The notes on pages 25 to 33 are an integral part of these condensed consolidated financial statements. 
 
Halfords Group plc? 
 
Consolidated statement of cash flows? 
 
For the?53?weeks to?3 April 2020? 
 
?                                      ?     53?weeks   52 weeks 
                                                  to?        to? 
?                                      ?            3 29?March?? 
                                              April?? 
 
                                                          2019?? 
                                                2020? 
?                                   Notes?        GBPm?        GBPm? 
Cash flows from operating              ?            ?          ? 
activities? 
Profit after tax for the period,       ?         46.7      48.3? 
before non-underlying?items? 
Non-underlying?items?                  ?       (29.2)     (6.4)? 
Profit after tax for the period?       ?         17.5      41.9? 
Depreciation - property, plant and     ?         24.3      23.0? 
equipment 
Impairment - property, plant and                  5.4          - 
equipment 
Amortisation?and impairment?of         ?         83.0         -? 
right-of-use assets? 
Amortisation?- intangible assets?      ?         11.4      13.0? 
Net finance costs?                     ?         13.6       3.4? 
Loss on disposal of property,          ?          2.8       5.5? 
plant and equipment?and 
intangibles? 
Equity-settled?share-based?payment     ?          1.0       0.3? 
transactions? 
Exchange movement?                     ?        (2.0)     (0.3)? 
Income tax expense?                    ?          1.9       9.1? 
Decrease in inventories?               ?          3.9      11.9? 
Decrease/(increase) in trade and       ?          3.7     (3.1)? 
other receivables 
Increase/(decrease)?in trade and       ?         44.4    (19.2)? 
other payables? 
(Decrease)/increase?in provisions?     ?        (3.1)       2.7? 
Income tax paid??                  ?           (16.3)    (12.7)? 
Net cash from operating            ?            191.5      75.5? 
activities? 
?                                  ?                ?          ? 
Cash flows from investing                  ?        ?          ? 
activities? 
Acquisition of subsidiary, net of  ?           (10.9)         -? 
cash acquired? 
Purchase of investment?            ????            -?     (0.5)? 
Purchase of intangible assets?     ?           (12.5)    (11.0)? 
Purchase of property, plant and    ?           (21.1)    (18.4)? 
equipment? 
Net cash used in investing activities?         (44.5)    (29.9)? 
?                                  ?                ?          ? 
Cash flows from financing          ?                ?          ? 
activities? 
Net proceeds from share options    ?               -?     (0.6)? 
and purchase of own shares? 
Finance income received                           0.3          - 
Finance costs paid                             (13.5)      (3.1) 
Repayment of loan following                     (1.8)          - 
acquisition 
Proceeds from loans, net of        ?          1,377.0   1,138.7? 
transaction costs? 
Repayment of borrowings?           ?         (1,262.0 (1,159.0)? 
                                                    ) 
Payment of capital element of      ?           (87.7)     (0.6)? 
leases?(2019: payments made on 
finance leases)? 
Dividends paid??                       ?       (36.6)    (35.9)? 
Net cash used in financing         ?           (24.3)    (60.5)? 
activities? 
Net increase/(decrease)?in cash       9?        122.7    (14.9)? 
and bank overdrafts? 
Cash and cash equivalents at the       ?        (7.4)       7.5? 
beginning of the period? 
Cash and cash equivalents at the       9        115.3     (7.4)? 
end of the period? 
 
The notes on pages?25?to?33?are an integral part of these condensed consolidated financial statements.? 
 
Halfords Group plc 
 
Notes to the condensed consolidated financial statements 
 
For the 53 weeks to 3 April 2020 
 
1. General information and basis of preparation 
 
The financial information set out below does not constitute the Group's statutory accounts for the periods ended 3 April 
2020 or 29 March 2019 but is derived from those accounts. Statutory accounts for 2019 have been delivered to the Registrar 
of Companies, and those for 2020 will be delivered in due course. The auditor has reported on those accounts; their 
reports were (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way 
of emphasis without qualifying their report and (iii) did not contain a statement under section 498 (2) or (3) of the 
Companies Act 2006. 
 
 The financial statements are presented in millions of UK pounds, rounded to the nearest GBP0.1m. 
 
The accounts of the Group are prepared for the period up to the Friday closest to 31 March each year. Consequently, the 
financial statements for the current period cover the 53 weeks to 3 April 2020, whilst the comparative period covered the 
52 weeks to 29 March 2019. 
 
The consolidated financial statements of Halfords Group plc and its subsidiary undertakings, together "the Group", have 
been prepared in accordance with International Financial Reporting Standards ("IFRSs") and IFRS Interpretations Committee 
("IFRS IC") Interpretations as adopted by the European Union and with those parts of the Companies Act 2006 applicable to 
companies reporting under IFRS. The financial statements are prepared on a going concern basis and under the historical 
cost convention, except where adopted IFRSs require an alternative treatment. The principal variations relate to financial 
instruments (IFRS 9 "Financial instruments"), share-based payments (IFRS 2 "Share-based payment" and leases (IFRS 16 
"Leases"). 
 
Adoption of new and revised standards 
 
Other than IFRS 16, there are no new or amended standards effective in the period which has had a material impact on the 
consolidated financial information. 
 
IFRS 16 "Leases" 
 
IFRS 16 introduced a single, on-balance sheet accounting model for lessees. As a result, the Group, as a lessee, has 
recognised right-of-use assets representing its rights to use the underlying assets and lease liabilities representing its 
obligation to make lease payments. Lessor accounting remains similar to previous accounting policies. 
 
a) Transition Method and Practical Expedients Utilised 
 
The Group has applied IFRS 16 using the modified retrospective transition approach, with recognition of transitional 
adjustments on the date of initial application (30 March 2019), without restatement of comparative figures. 
 
Previously, the Group determined at the inception of a contract whether an arrangement was or contained a lease under 
IFRIC 4 Determining Whether an Arrangement contains a Lease. The Group now assesses whether a contract is or contains a 
lease based on the new definition of a lease. Under IFRS 16, a contract is, or contains, a lease if the contract conveys a 
right to control the use of an identified asset for a period of time in exchange for consideration. 
 
On transition to IFRS 16, the Group elected to apply the practical expedient allowing the standard to be applied only to 
contracts that were previously identified as leases under IAS17 and IFRIC 4. Therefore, the definition of a lease under 
IFRS 16 has been applied only to contracts entered into or changed on or after 30 March 2019. 
 
IFRS 16 provides for certain optional practical expedients, including those related to the initial adoption of the 
standard. In applying IFRS 16 for the first time, the group has used the following practical expedients permitted by the 
standard: 
 
· Apply a single discount rate to a portfolio of leases with reasonably similar characteristics; 
 
· The exclusion of initial direct costs for the measurement of the right-of-use asset at the date of initial 
application; 
 
· Reliance on previous assessments on whether leases are onerous; 
 
· Applied the exemption not to recognise right-of-use assets and liabilities for leases with less than 12 months of 
lease term remaining as of the date of initial application. 
 
As a lessee, the Group previously classified leases as operating or finance leases based on its assessment of whether the 
lease transferred substantially all of the risks and rewards of ownership. Under IFRS 16, the Group recognises 
right-of-use assets and lease liabilities for most leases. However, the Group has elected not to recognise right-of-use 
assets and lease liabilities for some leases of low value assets. The Group recognises the lease payments associated with 
these leases as an expense on a straight-line basis over the lease term. 
 
At the commencement date of property leases the Group determines the lease term to be the full term of the lease, assuming 
that any option to break or extend the lease is unlikely to be exercised. Leases are regularly reviewed and will be 
revalued if it becomes likely that a break clause or option to extend the lease is exercised. 
 
b) Right-of-use assets 
 
The Group recognises a right-of-use asset at the lease commencement date. The right-of-use assets are measured at either: 
 
· Their carrying amount as if IFRS 16 has been applied since the commencement date, discounted using the lessee's 
incremental borrowing rate at the date of initial application - the Group applied this approach to the majority of the 
Retail property portfolio; or 
 
· An amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments - the Group 
applied this approach to all other leases. 
 
Subsequent to measurement right-of-use assets are amortised on a straight-line basis over the remaining term of the lease 
or over the remaining economic life of the asset if this is judged to be shorter. 
 
c) Lease liabilities 
 
The lease liabilities are measured at the present value of the remaining lease payments, discounted using the Group's 
incremental borrowing rate as at 30 March 2019. The Group's incremental borrowing rate is the rate at which a similar 
borrowing could be obtained from an independent creditor under comparable terms and conditions. Judgement is required to 
determine an approximation, calculates based on UK Government Gilt rates of an appropriate duration and adjusted by an 
indicative credit premium and a lease specific adjustment. The range of rates applied was 0.76% to 3.77%. 
 
Subsequently, the lease liability is increased by the interest cost on the lease liability and decreased by the lease 
payment made. It is remeasured if there is a modification, a change in lease term or a changed in the fixed lease 
payments. 
 
d) Impacts on the financial statements 
 
The group leases many assets including properties, cars and other equipment. 
 
As a lessee, the Group previously classified leases as operating lease or finance lease based on its assessment of whether 
the lease transferred substantially all of the risks and rewards of ownership. Under IFRS 16, the Group recognises 
right-of-use assets and lease liabilities for most leases, except for short-term leases and leases of low-value assets. 
 
i) Statement of Consolidated Financial Position 
 
The impact on the Statement of Financial Position on transition is summarised below: 
 
                              30 March 
 
                                  2019 
 
                                    GBPm 
Right-of-use assets              389.1 
Property, plant and equipment    (7.2) 
Lease liabilities              (456.8) 
Deferred tax asset                 6.2 
Prepayments                     (13.0) 
Accruals                        (39.0) 
Retained earnings                 25.1 
 
The table below shows a reconciliation from the total operating lease commitment as disclosed at 30 March 2019 to the 
total lease liabilities recognised in the accounts immediately after transition: 
 
                                                        30 March 
 
                                                            2019 
 
                                                              GBPm 
Operating lease commitment at 29 March 2019 as             507.6 
disclosed in the Group's consolidated financial 
statements 
Discounted using the incremental borrowing rate at 30     (61.5) 
March 2019 
Recognition exemption for lease of low-value                 0.1 
assets/short-term leases 
Finance lease liabilities recognised at 29 March 2019       10.6 
under IAS 17 
Total lease liabilities recognised at 30 March 2019        456.8 
 
The Group presents right-of-use assets separately in the consolidated balance sheet. 
 
The carrying amounts of right-of-use assets are as below: 
 
                          Property, Plant and Equipment 
 
                                                     GBPm 
Balance at 30 March 2019                          396.3 
Balance at 3 April 2020                           349.9 
 
ii) Consolidated Income Statement?? 
 
The Group has recognised depreciation and interest costs in respect of leases that were previously classified as operating 
leases in the income statement for the period, rather than rental charges.? During the period ended?3?April?2020, the 
  Group recognised GBP72.6m of additional depreciation charges and GBP10.8m of additional interest costs in respect of these 
leases.???? 
 
? 
 
iii) Reserves?? 
 
Where the Group has chosen to implement IFRS 16 using the modified transition approach, whereby the initial right-of-use 
asset values were equal to the present value of the remaining lease payments there is no impact on reserves at the date of 
transition. 
 
? 
 
Where the cumulative approach has been adopted the mismatch between the liability and asset value at transition is taken 
 to reserves. The Group has taken GBP25.1m to reserves at the start of the period.?? 
 
? 
 
?New standards and interpretations not yet adopted? 
 
? 
 
All other standards and related adoptions which have been published but not yet adopted are not expected to have 
a?material impact on the consolidated results or financial position of the Group.?A full listing will be provided in the 
statutory accounts.? 
 
2.??? Operating expenses? 
 
For the period?                    ?  53?weeks to?  52 weeks to? 
?                                  ?     3 April??     29?March? 
 
                                             2020?        ?2019? 
?                                  ?           GBPm?           GBPm? 
?                                  ?             ?             ? 
Selling and distribution costs?   ?         436.0?        424.3? 
?                                 ?         436.0?        424.3? 
Administrative expenses, before   ?           86.5         92.5? 
non-underlying?items? 
Non-underlying?administrative     ?          34.2?          7.8? 
expenses? 
?                                 ?         120.7?        100.3? 
?                                 ?         556.7?        524.6? 
 
3. Operating profit 
 
For the period              53              52 weeks to 
                         weeks 
                            to 
                       3 April                 29 March 
 
                          2020                     2019 
                            GBPm                       GBPm 
         Operating 
         profit is 
         arrived at 
         after 
         charging/(cr 
         editing) the 
         following 
         expenses/(in 
         comes) as 
         categorised 
         by nature: 
         Operating 
         lease 
         rentals: 
         - plant and               0.6                       3.8 
         machinery 
         - property                2.5                      93.1 
         rents 
         - rentals               (3.0)                     (3.1) 
         receivable 
         under 
         operating 
         leases 
         Landlord                (0.6)                     (1.3) 
         surrender 
         premiums 
         Loss on                   2.8                       5.5 
         disposal of 
         property, 
         plant and 
         equipment 
         and 
         intangibles 
         Amortisation             11.4                      13.0 
         of 
         intangible 
         assets 
         Amortisation             73.6                         - 
         of 
         right-of-use 
         assets 
         Depreciation 
         and 
         impairment 
         of: 
         - owned                  24.3                      22.3 
         property, 
         plant and 
         equipment 
         - assets                    -                       1.0 
         held under 
         finance 
         leases 
         Impairment 
         of: 
         - owned                     -                     (0.3) 
         property, 
         plant and 
         equipment 
         - impairment              9.4                         - 
         of 
         right-of-use 
         assets 
         Trade                     0.2                       0.1 
         receivables 
         impairment 
         Staff costs             256.2                     239.4 
         Cost of                 563.8                     554.2 
         inventories 
         consumed in 
         cost of 
         sales 
 
4. Non-underlying items 
 
For the period                               53 weeks to     52 
                                                          weeks 
                                                             to 
                                                 3 April     29 
                                                          March 
 
                                                    2020 
                                                           2019 
                                                      GBPm     GBPm 
         Non-underlying 
         operating expenses: 
         Organisational restructure costs (a)        2.8    6.8 
         Group-wide strategic review (b)             1.0    2.4 
         Closure costs (c)                          26.8      - 
         Acquisition and investment related          1.9    0.2 
         fees (d) 
         One-off claims (e)                          0.8      - 
         Impairment of right-of-use assets (f)       0.9      - 
         One-off royalty income (g)                    -  (1.6) 
         Non-underlying items before tax            34.2 4.57.8 
                                                   (5.0)  (1.4) 
 
         Tax on non-underlying items (h) 
                                                    29.2    6.4 
 
         Non-underlying items after tax 
 
a) In the current and prior period separate and unrelated organisational restructuring activities were undertaken. 
 
Current period costs comprised: 
 
· Redundancy and transition costs of GBP1.4m relating to roles which have been outsourced or otherwise will not be 
replaced (FY19: GBP1.5m); and 
 
· GBP1.4m of asset write-offs, principally resulting from the strategic decision to re-platform the Retail and Autocentres 
websites (FY19: GBP5.3m). 
 
(b) In the current and prior periods costs were incurred in preparing and implementing the new Group strategy. 
 
· GBP0.4m of external consultant costs (FY19: GBP2.0m); and 
 
· GBP0.6m of store labour costs, point of sale equipment and other associated costs in completing the cycling space relay 
across the store estate (FY19: GBPnil). 
 
 Prior period costs also included GBP0.4m of warehouse and distribution costs in order to align our network with the new 
strategy. 
 
(c)?? Closure costs represent costs associated with the proposed closure of the operations of Cycle Republic and the 
Boardman Performance Centre ("Cycle Republic") following a strategic review of the Group's cycling businesses. The 
provision mostly relates to the impairment of right-of-use assets, intangible and tangible assets and inventories. 
 
(d)???In the current and prior periods costs were incurred in relation to the investment in McConechy's Tyre Services and 
Tyres on the Drive. 
 
· Tyres on the Drive acquisition costs comprise of GBP1m principally relating to the costs of dual running Halfords Mobile 
Expert and Tyres on the Drive, as well as the write off of the receivables balance due from Tyres on the Drive related 
to Halfords Mobile Expert prior to acquisition; and 
 
· GBP0.9m relating to professional fees in respect of the acquisition of McConechy's Tyre Services. 
 
GBP0.2m of costs were incurred in the prior period in relation to the investment in Tyres on the Drive and costs relating to 
a potential acquisition which did not progress. 
 
(e)???During the year, a provision was created for expected costs of settling an ongoing court case, which was then 
 settled during the second half of the period. In addition, a provision of GBP0.6m has been recognised in relation to the 
audit by HMRC relating to the national minimum wage. 
 
(f) In light of the ongoing COVID-19 pandemic, the Group has revised future cash flow projections for stores and garages. 
 As a result, GBP0.9m incremental impairment has been recognised in relation to garages where the current and anticipated 
future performance does not support the carrying value of the right-of-use asset and associated tangible assets. This 
charge is directly attributable incremental impairment due to COVID-19 and relates primarily to the right-of-use asset 
value. 
 
(g)??A one-off royalty income was received in the current period in relation to the use of a software licence. 
 
 (h) The tax credit of GBP5.0m represents a tax rate of 14.6% applied to non-underlying items. The prior period represents a 
tax credit at 18.0% applied to non-underlying items. 
 
5) Finance income and costs 
 
Recognised in profit or              53 weeks to     52 weeks to 
loss for the period 
                                         3 April        29 March 
 
                                            2020            2019 
                                              GBPm              GBPm 
            Finance 
            costs: 
            Bank                           (1.6)           (1.6) 
            borrowings 
            Amortisation                   (0.4)           (0.4) 
            of issue 
            costs on 
            loans 
            Commitment                     (0.6)           (0.6) 
            and 
            guarantee 
            fees 
            Interest                      (11.3)           (0.8) 
            payable on 
            lease 
            liabilities 
            Finance                       (13.9)           (3.4) 
            costs 
 
            Finance 
            income: 
                                             0.3               - 
 
            Bank and 
            similar 
            interest 
                                             0.3               - 
 
            Finance 
            income 
 
                                          (13.6)           (3.4) 
 
            Net finance 
            costs 
 
6) Taxation 
 
For the period                           53 weeks to 52 weeks to 
                                             3 April    29 March 
 
                                                2020        2019 
                                                  GBPm          GBPm 
           Current taxation 
           UK corporation tax charge             5.4        11.5 
           for the period 
           Adjustment in respect of            (0.5)         0.2 
           prior periods 
                                                 4.9        11.7 
           Deferred taxation 
           Origination and reversal of         (1.5)       (1.4) 
           temporary differences 
           Adjustment in respect of            (1.5)       (1.2) 
           prior periods 
                                               (3.0)       (2.6) 
 
           Total tax charge for the              1.9         9.1 
           period 
 
The tax charge is reconciled with the standard rate of UK corporation tax as follows: 
 
For the period                          53 weeks to  52 weeks to 
                                            3 April     29 March 
 
                                               2020         2019 
                                                 GBPm           GBPm 
          Profit before tax                    19.4         51.0 
 
          UK corporation tax at                 3.7          9.7 
          standard rate of 19% 
          (2019: 19%) 
          Factors affecting the 
          charge for the period: 
          Depreciation on                       0.5          0.5 
          expenditure not eligible 
          for tax relief 
          Other disallowable                    0.8          0.1 
          expenses 
          Adjustment in respect of            (1.9)        (1.0) 
          prior periods 
          Impact of overseas tax              (0.3)        (0.2) 
          rates 
          Impact of change in tax             (0.9)            - 
          rate on deferred tax 
          balance 
          Total tax charge for the              1.9          9.1 
          period 
 
The tax rate was due to reduce from 19% to 17% from 1 April 2020, following changes substantively enacted on 6 September 
2016. In the March 2019 Budget, it was announced that the corporation tax rate would remain at 19% from 1 April 2020. This 
was substantively enacted on 17 March 2020. 
 
The deferred tax asset at 3 April 2020 has been calculated based on the rate of 19% substantively enacted at the balance 
sheet date. 
 
The effective tax rate of 9.7% (2019: 17.8%) is lower than the UK corporation tax rate principally due to the 
non-deductibility of depreciation charged on capital expenditure and non-deductible amortisation of intangible assets and 
adjustment in respect of prior periods. 
 
 The tax charge for the period was GBP1.9m (2019: GBP9.1m), including a GBP5.0m credit (2019: GBP1.4m credit) in respect of tax on 
non-underlying items. 
 
The Group engages openly and proactively with tax authorities both in the UK and internationally, where it trades and 
sources products, and is considered low risk by HM Revenue & Customs ("HMRC"). The Company is fully committed to complying 
with all of its tax payment and reporting obligations. 
 
In this period, the Group's contribution from both taxes paid and collected exceeded GBP208.0m (2019: GBP172.0m) with the main 
   taxes including corporation tax of GBP16.3m (2019: GBP12.7m), net VAT of GBP101.4m (2019: GBP72.2m), employment taxes of GBP54.3m 
   (2019: GBP48.2m) and business rates of GBP36.3m (2019: GBP39.8m). 
 
7) Dividends 
 
For the period                  53 weeks to   52 weeks to 
                                    3 April      29 March 
 
                                       2020          2019 
                                         GBPm            GBPm 
Equity - ordinary shares 
Final for the 52 weeks to 29                  24.4          23.7 
March 2019 - paid 12.39p per 
share (2019: 12.03p) 
Interim for the 53 weeks to                   12.2          12.2 
3 April 2020 - paid 6.18p 
per share (2019: 6.18p) 
                                              36.6          35.9 
 
In addition, the Directors are not proposing a final dividend (2019: GBP24.4m at 12.39p per share) in respect of the 
financial period ended 3 April 2020. 
 
8) Earnings per share 
 
Basic earnings per share are calculated by dividing the profit attributable to ordinary shareholders by the weighted 
average number of ordinary shares in issue during the period. The weighted average number of shares excludes shares held 
by an Employee Benefit Trust and has been adjusted for the issue/purchase of shares during the period. 
 
For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion 
of all dilutive potential ordinary shares. These represent share options granted to employees where the exercise price is 
less than the average market price of the Company's ordinary shares during the 53 weeks to 3 April 2020. 
 
The Group has also chosen to present an alternative earnings per share measure, underlying earnings per share, with profit 
adjusted for non-underlying items because it better reflects the Group's underlying performance. 
 
For the period                                   53 weeks     52 
                                                       to  weeks 
                                                              to 
                                                  3 April     29 
                                                           March 
 
                                                     2020 
                                                            2019 
                                                   Number Number 
                                                       of     of 
                                                   shares shares 
                                                        m      m 
Weighted average                                    199.1  199.1 
number of shares in 
issue 
Less: shares held                                   (2.1)  (2.0) 
by the Employee 
Benefit Trust 
(weighted average) 
Weighted average number of shares for               197.0  197.1 
calculating basic earnings per share 
Weighted average                                      3.3    2.1 
number of dilutive 
shares 
Total number of                                     200.3  199.2 
shares for 
calculating diluted 
earnings per share 
 
For the period                                 53     53     52 
                                            weeks  weeks  weeks 
                                               to     to     to 
 
                                                3      3     29 
                                            April  April  March 
                                                    2020 
                                                    (pre 
                                                    IFRS 
                                             2020    16)   2019 
 
                                               GBPm     GBPm     GBPm 
         Basic earnings attributable to      17.5   17.6   41.9 
         equity shareholders 
         Non-underlying items (see note 
         4): 
         Operating expenses                  34.2   32.1    7.8 
         Tax on non-underlying items        (5.0)  (4.7)  (1.4) 
         Underlying earnings before          46.7   45.0   48.3 
         non-underlying items 
 
For the period 
                                               53     53     52 
                                            weeks  weeks  weeks 
                                             to 3   to 3  to 29 
                                            April  April  March 
                                                    2020 
                                                    (pre 
                                                    IFRS 
                                             2020    16)   2019 
         Basic earnings per ordinary         8.9p   8.9p  21.2p 
         share 
         Diluted earnings per ordinary       8.7p   8.8p  21.0p 
         share 
 
         Basic underlying earnings per      23.7p  22.9p  24.5p 
         ordinary share 
         Diluted underlying earnings per    23.3p  22.5p  24.2p 
         ordinary share 
 
9) Analysis of movements in Group's net debt in the period 
 
                  At 29  Cash flow Recognised   Other At 3 April 
                  March                    on non-cas 
                                     adoption       h 
                                           of changes 
                                                            2020 
                   2019 
 
                                      IFRS 16 
                     GBPm         GBPm                 GBPm         GBPm 
 
                                           GBPm 
Cash and          (7.4)      122.7                  -      115.3 
cash 
equivalents 
at bank and 
in hand                                     - 
Debt due         (63.8)    (115.0)          -   (0.3)    (179.1) 
after one 
year 
Total net        (71.2)        7.7          -   (0.3)     (63.8) 
debt 
excluding 
leases 
Current           (1.3)       87.7     (79.4)  (90.2)     (83.2) 
lease 
liabilities 
Non-current       (9.3)          -    (377.4)    53.9    (332.8) 
lease 
liabilities 
Total lease      (10.6)       87.7             (36.3)    (416.0) 
liabilities 
 
                                      (456.8) 
Total net        (81.8)       95.4             (36.6)    (479.8) 
debt 
 
                                      (456.8) 
 
 Non-cash changes include finance costs in relation to the amortisation of capitalised debt issue costs of GBP0.4m (2019: 
 GBP0.6m) and changes in classification between amounts due within and after one year. 
 
 Cash and cash equivalents at the period end consist of GBP115.5m (2019: GBP9.8m) of liquid assets and GBP0.2m (2019: GBP17.2m) of 
bank overdrafts. 
 
10) Leases 
 
All leases where the Group is a lessee are accounted for by recognising a right-of-use asset and a lease liability except 
for: 
 
· Leases of low value assets; and 
 
· Leases with a term of 12 months or less. 
 
IFRS 16 "Leases" was adopted on 30 March 2019 without restatement of comparative figures. For an explanation of the 
transitional requirements that were applied as at 30 March 2019, see note 1. 
 
i) Amounts recognised in the consolidated statement of financial position 
 
Right-of-Use Assets 
 
                                               Equipment 
 
                                      Land and        GBPm   Total 
 
                                     buildings                GBPm 
 
                                            GBPm 
At 30 March 2019                         388.5       7.8   396.3 
Additions on acquisition of               11.1       0.3    11.4 
subsidiary 
Reclassification from intangible           2.4         -     2.4 
assets 
Additions to right-of-use assets          10.0       1.9    11.9 
Amortisation charge for the year        (70.2)     (3.4)  (73.6) 
Effect of modification of lease           11.6         -    11.6 
Derecognition of right-of-use                -     (0.7)   (0.7) 
assets 
Impairment                               (9.4)         -   (9.4) 
At 3 April 2020                          344.0       5.9   349.9 
 
Lease Liabilities 
 
                                               Equipment 
 
                                      Land and        GBPm   Total 
 
                                     buildings                GBPm 
 
                                            GBPm 
At 30 March 2019*                        448.6       8.2   456.8 
Additions on acquisition of               11.0       0.2    11.2 
subsidiary 
Additions to lease liabilities            10.5       1.8    12.3 
Interest expense                          11.1       0.2    11.3 
Effect of modification to lease           11.7         -    11.7 
Lease payments                          (83.8)     (4.2)  (88.0) 
Foreign exchange movements                 0.7         -     0.7 
At 3 April 2020                          409.8       6.2   416.0 
 
* In the previous year, the Group only recognised lease assets and lease liabilities in relation to leases that were 
classified as 'finance leases' under IAS 17, "Leases". The assets were presented in property, plant and equipment and the 
liabilities as part of the Group's borrowings. For adjustments recognised on adoption of IFRS 16 on 30 March 2019, please 
refer to note 1. 
 
Lease liabilities                                             3 
                                                          April 
 
                                                           2020 
 
                                                             GBPm 
Maturity analysis - contractual undiscounted cash flows 
Less than one year                                         92.9 
Between one and two years                                  76.6 
Between two and five years                                177.0 
After five years                                          108.7 
Total contractual cash flows                              455.2 
 
ii) Amounts recognised in the consolidated income statement 
 
                                                Equipment 
 
                                       Land and        GBPm  Total 
 
                                      buildings               GBPm 
 
                                             GBPm 
53 weeks ended 3 April 2020 
Amortisation charge on right-of-use        70.2       3.4   73.6 
assets 
Interest on lease liabilities              11.1       0.2   11.3 
Income from sub-leasing 
right-of-use assets presented in 
'other revenue' 
Expenses relating to short-term             2.5         -    2.5 
leases 
Expenses relating to leases of                -       0.6    0.6 
low-value assets, excluding 
short-term leases of low-value 
assets 
52 weeks ended 29 March 2019 
Lease expense                              93.1       3.8   96.9 
Sub-lease income presented in             (3.1)         -  (3.1) 
'other revenue' 
 
iii) Amounts recognised in the consolidated statement of cash flows 
 
The total cash outflow for leases for the period ended 3 April 2020 was GBP87.7m. 
 
11) Inventories 
 
Following a review of inventory costing during the period, the Group concluded that the historic inclusion of certain 
distribution centre costs within the cost of inventories and the treatment of such distribution centre costs as an 
operating expense rather than a cost of sale was not in line with the Group's accounting policy.? 
 
In the consolidated statement of financial position, inventories at 29 March 2019 and 30 March 2018 are stated after 
 adjusting for this amount, and consequently retained earnings and net assets have been reduced by GBP11.7m.? In correcting 
this misapplication, there is no impact on reported gross profit, operating expenses or other items in the consolidated 
income statement or i the consolidated statement of cash flows for the current or comparative periods. 
 
ISIN:           GB00B012TP20 
Category Code:  ACS 
TIDM:           HFD 
LEI Code:       54930086FKBWWJIOBI79 
OAM Categories: 1.1. Annual financial and audit reports 
Sequence No.:   74071 
EQS News ID:    1087507 
 
End of Announcement EQS News Service 
 
 
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(END) Dow Jones Newswires

July 07, 2020 02:00 ET (06:00 GMT)