Soaring sales of upmarket bicycles and warm weather helped pretax profits rise 5.2% to �44.6m in the six months to September
Soaring sales of upmarket bicycles, boosted by a fine summer and a string of successes by British cyclists in international events, have helped Halfords' profits surge beyond City expectations, sending its shares to a three-year high.
The retailer and car service company, which is in the middle of a turnaround plan intended to raise sales to �1bn by 2016, revealed pretax profits had risen 5.2% to �44.6m in the six months to September ? a figure that was 20% better than analysts expected.
Underlying sales rose 6.2% as the company sold 26% more upmarket bicycles and 17% more kids' bikes than in the same period last year, offsetting a 2.1% decline in underlying sales at Halfords' car service centres. Online sales were particularly strong, up nearly 17%, helping deliver total sales for the group of �490.6m in the half.
Shares rose 14.4% to 478p, recovering to well above the point they dived from in May when chief executive Matt Davies said he was cutting dividend payments to invest in training staff and improving stores under his turnaround plan.
Davies, who joined the company in October last year, said: "These are good results but there is still plenty to do. We are happy with the progress so far but we are just in the early stages of growing the business so its important that non of us get carried away."
The former Pets at Home boss said that sales had been boosted by good weather over the summer and a string of successes by British cyclists in international events including the Tour de France.
He warned that sales had "surpassed expectation" in the first half of the year but things could get tougher over Christmas. "Last Chistmas we saw people buying electronic toys and that didn't help our kids bike business," he said.
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