UK retailer Halfords targets jump in sales and profit as markets recover

LONDON (Reuters) -British bicycle and car products retailer Halfords on Tuesday forecast a jump in sales and profit over the mid-term as its core markets recover and it grows market share.

Ahead of a Capital Markets Day presentation, Halfords, whose shares have fallen 30% over the last year, forecast annual sales to grow to about 1.9 billion pounds ($2.4 billion) over the mid-term from 1.6 billion pounds in its 2022-23 year and pretax profit to increase to 90-110 million pounds from 50-60 million.

It plans annual capital expenditure of 50-60 million pounds and a return on capital of over 15%.

"We expect to deliver this growth through a combination of our core markets recovering from the current very challenging conditions, growing market share by leveraging the unique platform we have built, our acquisition synergies maturing, and using scaled and rich customer and vehicle data to drive customer lifetime value," Halfords said.

In the mid-to-long term, the group forecast sales to grow to about 2.2 billion pounds and pretax profit to increase to 130-150 million pounds.

Halfords said this would be achieved by expanding into more areas of the motoring market, the servicing of electric cars, vans, scooters and bikes and growing its Autocentres garage business.

The group also said it would pay a total dividend of 10 pence a share for the 2022-23 year.

Halfords shares were up 2.5% in early trading.

($1 = 0.8065 pounds)

(Reporting by James Davey, Editing by Louise Heavens and Ed Osmond)