Halfords Group PLC (HFD)
Q3 Trading Update: Financial Year 2021
14-Jan-2021 / 07:00 GMT/BST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
=----------------------------------------------------------------------------------------------------------------------
14 January 2021
Halfords Group plc
Q3 Trading Update: Financial Year 2021
Strong LFL momentum continued in a challenging operating environment.
Autocentres LFL revenue up 21.1%, with strong performances from key areas of strategic importance (online, services,
B2B)
Halfords Group plc ("Halfords" or the "Group"), the UK's leading provider of Motoring and Cycling products and
services, today announces its Q3 trading update for the 13 weeks to 1 January 2021 ("the period").
Key financials
Q3 Year-to-date
(13 weeks) (39 weeks)
% change % change
TOTAL REVENUE
Halfords Group +11.5% +10.0%
Retail +7.7% +5.5%
Autocentres +30.5% +35.6%
LIKE-for-LIKE ("LFL" REVENUE)
Halfords Group +11.7% +9.0%
Retail +9.8% +9.4%
Motoring -8.4% -18.2%
Cycling +35.4% +49.1%
Autocentres +21.1% +6.6%
Key highlights ? Strong trading performance across the quarter
with Group LFL sales growth of +11.7%, comprising Retail LFL
+9.8%
and Autocentres LFL +21.1%. ? Autocentres sales up +30.5%,
reflecting a significant increase in market share, driven by our
best-in-class digital
operating model, our first group-wide motoring campaign and
expansion of our unique Halfords Mobile Expert vans
proposition. ? In Retail;
? Cycling LFL growth of +35.4% driven by continued strength in
Adult Mechanical, e-bikes and e-scooters, despite
global container shortages and port congestion impacting
availability.
? Motoring LFL sales down -8.4%, a pleasing performance relative
to UK traffic volumes being approximately -25%
lower than pre-pandemic levels as a result of lockdowns.
? Our performance cycling business, Tredz, continued to see high
levels of demand, growing +51.2% LFL over the
quarter, indicating a high retention of customers from Cycle
Republic, which we exited in March 2020.
? LFL rates as we exited the quarter were lower than quarter
averages as increased lockdowns weakened demand and
supply chain disruption delayed stock arriving into the
business. ? We continued to perform well in areas of strategic
focus:
? Net Promoter Score ("NPS") improvements accelerated in Q3, up
+4.3 points year-on-year, driven primarily by
improved customer journeys across all of our channels.
? Group Service-Related Sales growth of +31% with strong demand
for motoring services and cycle repair mitigating
the impact of lower traffic volumes.
? Group online growth of +76%, reflecting accelerated investment
in our web platform and the continued customer
shift towards this channel.
? B2B growth of +44%, with very strong growth in our Cycle to
Work scheme supported by good growth in our Fleet
business.
? Improved Cycling profitability, on track to exceed our target
of improving Cycling gross margin by 300bps in
FY21 ? In November 2019 we highlighted our intention to reshape
our property portfolio, to enable us to deliver a more
integrated and flexible customer and services proposition and to
assist in creating a more cost-efficient business.
We indicated this may result in closing up to 10% (c. 80 sites)
of our property estate, whilst simultaneously
growing our fleet of Mobile Expert vans. Since then, we have
closed 33 sites (including 22 Cycle Republic stores,
after exiting the business) and will be closing a further 47
financially low-returning stores and garages before
the end of the financial year. The additional closures will
result in an annualised P&L benefit of over GBP6m after
an exceptional cost in FY21 of GBP25m-GBP30m. Of this, we
anticipate exceptional cash costs, including lease payments,
of GBP10m-13m in FY21 and FY22, which will be offset by working
capital reductions, tax savings and improved profit
contribution. ? We successfully completed the refinancing of a
GBP180m revolving credit facility in December 2020, welcoming
three
new banks into the syndicate.
Graham Stapleton, Chief Executive Officer, commented:
"We are pleased to have delivered a strong performance under
hugely challenging circumstances, including our best ever Christmas
week. Despite a large reduction in traffic on the roads, our
strategically important Autocentres business saw significant
growth, with particularly strong demand for the services of our
growing fleet of Halfords Mobile Expert vans.
We are currently carrying out over half a million services and
repair jobs on cars and bikes each month, and therefore continue to
play an essential role in keeping the UK moving during this
pandemic. Throughout the crisis we are privileged to have been able
to offer free checks and discounts to 239,000 NHS workers, teachers
and Armed Forces staff to help them keep their vehicles safe and
roadworthy.
The health and safety of our colleagues and customers remains
our number one priority and I would like to offer my sincere thanks
for their unwavering loyalty and support."
Outlook
The UK government announced a third national lockdown on 4
January 2021. As an essential retailer and services provider, our
portfolio of stores, garages and Mobile Expert vans will remain
open and continue to support key workers and customers with their
journeys. The scale and extent of this lockdown will inevitably
impact demand for our motoring products and services, with fewer
car journeys being made across the UK. Although we currently
anticipate a less severe impact on motoring demand relative to the
spring lockdown, the cycling market is seasonally smaller during Q4
and may not fully offset the impact on motoring.
We remain confident in the financial strength and operational
agility of our business to navigate the ongoing challenges arising
from COVID-19. Our significant progress this year will ensure that
we start financial year 2022 with a stronger platform for growth
but, nevertheless, the immediate financial impact in Q4 is
uncertain. We do not believe it appropriate to provide profit
guidance at this stage but we currently intend to issue a pre-close
statement during March 2021. Our position with respect to business
rates relief and the Coronavirus Job Retention Scheme is still
under review and we will provide an update when the COVID-19
situation becomes clearer.
Enquiries
Investors & Analysts (Halfords)
Loraine Woodhouse, Chief Financial Officer
+44 (0) 7483 360 675
Neil Ferris, Corporate Finance Director
neil.ferris@halfords.co.uk
+44 (0) 1527 513189
Andy Lynch, Head of Investor Relations
andrew.lynch@halfords.co.uk
Media (Powerscourt) +44 (0) 20 7250 1446
Rob Greening halfords@powerscourt-group.com
Lisa Kavanagh
Conference Call
There will be a conference call for investors and sell-side
analysts beginning at 9:00am today (UK time). A copy of the
transcript of the call will be available at www.halfordscompany.com
in due course. For further details please contact Powerscourt on
the details above.
Notes to Editors
www.halfords.com www.halfordscompany.com www.tredz.co.uk
Halfords is the UK's leading provider of motoring and cycling
products and services. Customers shop at 440 Halfords stores, 3
Performance Cycling stores (trading as Tredz and Giant), 367
garages (trading as Halfords Autocentres and McConechy's) and have
access to 121 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
-----------------------------------------------------------------------------------------------------------------------
ISIN: GB00B012TP20
Category Code: QRT
TIDM: HFD
LEI Code: 54930086FKBWWJIOBI79
Sequence No.: 91438
EQS News ID: 1160495
End of Announcement EQS News Service
=-------------------------------------------------------------
(MORE TO FOLLOW) Dow Jones Newswires
January 14, 2021 02:00 ET (07:00 GMT)
Halfords (LSE:HFD)
Historical Stock Chart
From Feb 2024 to Mar 2024
Halfords (LSE:HFD)
Historical Stock Chart
From Mar 2023 to Mar 2024