Despite a slight overall improvement during the fourth quarter, full-year revenues for bicycle & car parts retailer Halfords fell annually by 0.8 per cent, it was announced today.
Halfords retail sales in the UK & Ireland dropped 2.7 per cent like-for-like in the 52 weeks to March 30th 2012, although its leisure & Autocentres divisions saw overall growth in trading.
The retailer expects full-year profits to be between £90 million and £93 million, down from £125.6 million in 2011, after it invested heavily in its new Autocentre service offer and its online presence.
David Wild, CEO of Halford, said: “The strong performance from our growth areas provides an attractive route to strengthen our business.
“We are investing to drive our strong brand even further by developing our fitting resources, increasing marketing and enhancing our multichannel offer.
“Investing in these opportunities will accelerate the evolution of Halfords from a traditional retailer to a contemporary provider of products and services, and will contribute future growth.”
Its fourth quarter trading showed a general improvement in retail performance with its Car Maintenance division reporting a 3.1 per cent growth in LFLs during the last 13 weeks of the year, compared to a decline of 4.5 per cent over the full period.
Halfords said that its was disappointed with online trading during the quarter however, with its website accounting for just eight per cent of total retail sales thanks to a decline in both Sat Nav and Child Safety product lines.
Around £6 million has been earmarked for capital expenditure over the next 12 months, with a roll-out of up to 30 new Autocentres planned, but the retailer anticipates a four per cent increase in operating costs due to rising business rates and staff costs.
Wild added: “The UK consumer outlook for FY13 is uncertain and the continued rise in fuel prices remains a concern. Our actions have reduced input-cost inflation, but retailers face a rise in operating costs.
“While we have historically demonstrated an ability to alleviate these it may be more difficult this year.”