Cycle sales help Halfords hit two year high

The continuing popularity in cycling is just one of the factors that has given a lift to Halfords Group Plc, the UKs biggest retailer of car parts and bicycles. The retail group revealed a fresh rise in sales, boosted by its car maintenance and cycle units.

Another reason for the good news is the stay-at-home holidaymakers, with Britons deciding to holiday in the UK due to the current financial climate, thus boosting the demand for camping equipment.

The company reported a 2.2% growth in like for like sales in the second quarter, and it said it expected to make half year profits of between £59m and £61m. It said sales momentum in cycling helped its leisure division.

Total sales increased by 3.8% in the quarter to October 2, taking sales growth for the first half to 3.4%.

Shares jumped 8% as the 470-branch chain said half-year profit will be around £60 million, and analysts raised full-year profit forecasts to £106 million. Halfords’ shares have risen more than 50 percent in a year helped by consumer demand for bicycles.

Halfords said the “sales momentum” in the leisure sector during the first quarter had continued, spurred by growing interest in bikes and more being spent on vehicle maintenance, and the successful summer season increased confidence in prospects for the company's full-year performance.

It’s more good new for the cycling retail market, after the latest report from ActSmart showed retailers were coming out on top during the tough times

The August report showed core sales in August increased by 3.7 per cent compared to the same time last year 2008, and fifty-nine per cent of retailers reported sales were up, over half by more than 20 per cent. It means that while the recession is hitting many areas of business, cycling has seen a sales growth of 3.9% in the last three months