Halfords profit to beat expectations

23rd Mar 2010 07:48

Car parts and bike retailer Halfords said it expects earnings for the year to be ahead of expectations after seeing a rise in sales in the 11 weeks to 19 March.Sales increased by 1.3% compared with the same period the previous year and rose by 0.8% on a like-for-like basis, stripping out the impact of new stores. Halfords now expects pre-tax profits for the full-year to come in at between £114m and £116m, compared with analyst expectations of around £112.7m. Halfords said it saw strong sales of car maintenance products, due partly to the prolonged wintery weather, helping to aid margins. However, bike sales fell below Halfords own expectations, rising by 1.9% on a like-for-like basis and the satellite navigation market remains challenging, the company said. Halfords said that trading at Nationwide Autocentres, the chain of car servicing and repair garages it acquired last month, has been good, with like-for-like sales growth of 5%. However, the company also announced that it will close its seven stores in the Czech Republic and Poland after seeing an operating loss in the last 12 months. This will result in an uplift in earnings, but also an exceptional charge of £7.9m, Halfords said.'Halfords retail performance continues to be robust, with full year earnings now anticipated to grow by approximately 25%,' said chief executive David Wild. 'The acquisition of Nationwide Autocentres, completed during the quarter, logically extends our successful service proposition and provides a further opportunity for future growth.'He said that while Central Europe has attractive long-term prospects, the continuing recession was limiting growth prospects.