// Halfords cuts its full-year profit guidance amid weakness in the consumer tyre market and labour market issues.
// Chief executive Graham Stapleton has called on the government to help fill a gap in the labour market
Halfords has lowered its full-year profit guidance amid weakness in the consumer tyre market and labour market issues.
The car parts and bicycle retailer said it now expects underlying pre-tax profit for FY23 of between £50m and £60m, down from previous guidance of £65m to £75m.
In an update for the 13 weeks to 30 December, Halfords said group revenue grew 38.3%, reflecting strong sales in the motoring division and needs-based categories, but overall revenues were hit by softer-than-expected cycling and tyre markets.
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Addressing labour issues, chief executive Graham Stapleton called on the government to help fill a gap in the labour market and said he couldn’t get “enough qualified technicians into our garages to meet demand” and that was hurting growth.
Stapleton said the government could help fill in this gap by expanding the apprenticeship levy “to make it easier to use funds to train employees on new technologies,” as well as by sponsoring awareness programmes “to reach all communities.”
“If apprentices were treated in the same way as young people in education or training it could have a transformative effect.”
Despite headwinds and the ongoing labour shortages, Halfords gained a share in all “our measured markets” – including cycling, motoring and tyres.
“We have seen strong revenue growth in what are exceptionally challenging circumstances, and we have continued to grow our market share whilst also tightly managing our costs, inventories and cash flows,” said Stapleton.
“Consumer demand for our services and needs-based categories, which now account for the majority of our revenue, continues to grow, and our Motoring Loyalty Club is exceeding expectations as customers recognise the value of its unrivalled discounts and offers.”
Looking ahead, the company expects “the resilience and strength of our growing service and needs-based products business to continue” but due to the ongoing recession “high ticket, discretionary spending” will not recover in the short term.
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