The country’s continuing love affair with cycling is paying off for Halfords after the retailer’s annual sales broke £1bn for the first time.
The cycle and car-repair chain sold 1.3m bikes, making cycling the best-performing category in the business as revenues climbed from £940m last year to just over £1bn.
Demand for premium bikes grew by a quarter, in a year when the Tour de France came to London, Cambridge and Yorkshire. Halfords sells a range of bikes associated with champion cyclists, including Chris Boardman and Bradley Wiggins, for prices ranging from £500 to £1,800.
Demand for children’s bikes was up 13%, with a 40% jump in sales of older children’s bikes, after a Christmas marketing campaign with the tagline “Does anything beat a bike?”.
Business was also brisk at Halfords’ car repair and servicing centres, with revenues up 7.6% on the previous year. Sales of car cleaning products were up 13%, after the company extended its range, although demand for satnavs continued to reflect a “structurally declining market”.
The FTSE 250-listed company reported pre-tax profits of £81m in the year to 3 April, up 11% on the previous year’s profits. Shareholders will get a dividend of 16.5p per share, compared with 14.3p last year.
The strong performance raises the bar for Halfords’s new chief executive, Jill McDonald, who joined Halfords in May to become one of a handful of women leading British listed-companies. She previously worked at McDonald’s, where she led the fast-food chain’s operations in 8 countries, including the UK.
McDonald said she was “getting her feet under the desk” and that it would be premature to make statements about the company’s future.
Since joining Halfords three weeks ago, she has been visiting stores, including the standalone Cycle Republic chain the group launched last October. Cycle Republic has five outlets, but former chief executive Matt Davies said he could envisage opening 100 stores.
Chairman Dennis Millard said Halfords was traditionally seen as the place where the family bought their bikes, but was stretching its credentials into premium bikes.
