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Halfords Group PLC on Tuesday set its sights on more than doubled pretax profit in the coming years as it outlined its strategic vision at a Capital Markets Day for institutional investors and sell-side analysts. The motoring and cycling products retailer plans to leverage the platform built since 2018 and deliver improved revenue, profit and return on capital employed over the mid-term and mid-to-long-term. In the mid-term, Halfords expects sales to grow to around £1.9 billion from £1.6 billion in financial year 2023 and pretax profit to advance to £90-£110 million from between £50-£60 million in 2023. The firm sees average annual capex of between £50 million to £60 million and return on capital employed of over 15%. It expects growth through a combination of recovery in core markets, growing market share, acquisition synergies and improved use of data. In the mid-to-long-term, Halfords plans to pursue a range of strategic growth opportunities including expansion into more areas of the motoring market, creating a one-stop-shop for motoring ownership. These plans are expected to deliver sales of around £2.2 billion and pretax profit of between £130 million and £150 million. Halfords said its business was underpinned by a strong balance sheet, and it expects positive free cash flow throughout the mid and mid-to-long-term. Financial year 2023 underlying pretax profit is forecast within current guidance and Halfords intends to pay a final dividend of 7.0 pence per share alongside full year results making the total payout for the year 10 pence. Halfords’s financial year ended in late March or early April. Shares in Halfords jumped 8.1% to 190.85 pence each in London on Tuesday. Copyright 2023 Alliance News Ltd. All Rights Reserved.
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