By Peter Nurse
Investing.com - Shares in Halfords Group (LON:HFD) slumped Thursday after the retailer cut its profits trading range from its forecast issued in November, citing a challenging labor market as well as weakness in the tire market.
Halfords, the U.K.’s leading provider of motoring and cycling services and products, reported 4.6% like-for-like sales growth in the third quarter compared with 2021, and a hefty 12.6% growth compared with pre-pandemic 2020.
Strong sales in motoring helped offset softer-than-expected cycling and tire markets, the company said.
However, the company lowered its fiscal year 2023 underlying profit before tax guidance to £50 million - £60 million (£1 = $1.2159) from the £65M - £75M range it gave just two months ago.
The company’s stock price fell over 18%, dropping to levels not seen since late October.
“With unprecedented demand in our Motoring Services business, we are particularly impacted by the nationwide skills shortage, with recruitment proving to be extremely challenging in the current labor market,” Chief Executive Graham Stapleton said.
“We also expect the consumer tire market to recover through the course of the year,” Stapleton added, “consumers will, however, continue to face inflation, and we therefore do not expect a significant short-term recovery in high ticket, discretionary spending.”