Halfords’ chief executive says the company remains “very confident” about the cycling market, despite the UK’s largest retailer of cycling products and services suffering a 55 percent fall in pre-tax profits as the bike industry continues to struggle due to inflation and the cost-of-living crisis.
Publishing its preliminary results for the 52 weeks to the end of March, the retailer announced an overall pre-tax profit of £43.5 million, down £53.1 million versus the 2022 financial year.
The company cited inflationary pressures and a tough comparison against the previous year (which was up by 57.8 percent compared to the year prior to the Covid-19 pandemic) as the primary reasons behind the drop.
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While the war in Ukraine had acted as “a catalyst to already increasing inflation”, Halfords noted that the “volatile political and economic environment” last autumn hit sales of big-ticket, discretionary items such as bicycles.
Though the retailer also reported that its revenue grew by 15.3 percent to £1.59 billion last year, two of its core markets, tyres and bikes, faced a “significant downturn”, with the cycling market – which has suffered a difficult year throughout the UK – down 24 percent compared to 2020 levels.
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Nevertheless, Halfords’ chief executive Graham Stapleton has forecast a return to growth over the year ahead – pointing out that they have already experienced a “strong start” to the new financial year – while maintaining that the bike market “is the right place to be”.
“We’re very, very confident about the cycling market in the mid-term,” he said. “It still hits the sweet spot in terms of climate change, for example, and there is a big growth spill into electric bikes. We still think it’s the right place to be.”
The 55-year-old also noted that the cycling industry could soon be aided by a reduction in inflationary pressures.
“While the costs of energy, labour, and currency remains high, we do expect to see some deflation in cycling and rubber-based products. We’re also going to see freight costs fall,” Stapleton said.
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The 24 percent fall in Halfords’ cycle market supports figures published in February in the Bicycle Association’s Annual Market Data Report for 2022, which showed that UK bike sales have fallen to their lowest level in 20 years.
Combining sales figures and other data, the Association’s research suggests that mechanical bike sales fell by 22 percent in 2022, down to 1.8 million units and 27 percent below pre-Covid levels.
I guess the country is more policed... also we have a lot of radars for example, could they do some checking in addition to speed limits and red...
I lived a fair distance, 40 ish minutes walk, which I did every day. Only one of my house shares had a car and he walked too. Back then 92 to 95...
3 quid from planet X......
The front one seems a bit useless - what is it protecting, if not the feet, chain(wheel) and entire bottom bracket area? I found that "ToeSavers"...
I'll stick with my photocromatic ones from Rock Bros for 25 quid that are also way lighter.
I'm sure that somethings wrong here, but I don't think that it's the new traffic island...
The vision couldn't have been that good ,they went bankrupt.
I disagree, the lucky few who get to wear one of these will certainly produce more mass.
That wasn't what my original post was about - it was about the NHS as it is now. If you're going to be run over by an ambulance tomorrow, there are...
I prefer the not haveing to faff with brakes in first place, which is the typical reality for hydraulic systems.