Halfords Group PLC has issued a trading update for the financial year 2024, indicating a significant drop in like-for-like revenue growth in their Retail business. The company now expects the Underlying Profit Before Tax (PBT) to fall in the range of 35-40m, down from the previously anticipated 48m to 53m. This reduction is attributed to weakened customer confidence, adverse weather conditions, and increased competition in the Cycling market. However, the Autocentres business has shown good growth, and the Service, Maintenance, and Repair (SMR) market has strengthened.
The company remains cautious about market recovery in the short-term and anticipates challenging conditions to persist through the peak Easter cycling period in March. Looking ahead to FY25, Halfords expects the underlying PBT to be broadly in line with the forecast for FY24, assuming marginal year-on-year growth in core markets and the normalization of the Cycling market. The company is confident in its strategy and longer-term growth prospects, despite the short-term challenges.
The trading update also includes information about non-underlying items for FY24, such as costs related to the closure of the existing tyre supply operation. Halfords will review the carrying value of its assets in line with the year-end timetable and report the results as part of the Preliminary Results Announcement. The company's revised guidance for PBT includes the results of the tyre supply operation, based on All Operations.
Halfords Group PLC is the UK's leading provider of motoring and cycling services and products, with a significant presence in retail stores, garages, and online platforms. The company emphasizes that the report contains forward-looking statements and involves risk, uncertainty, and assumptions related to future events and circumstances. It also highlights that nothing in the announcement should be construed as a profit forecast.
Overall, the trading update reflects the challenges faced by Halfords Group PLC in the current market conditions, while also expressing confidence in its long-term strategy and growth potential.