* FY pretax 72.8 mln vs forecast 70.1 mln
* LFL cycling gear sales up 41.6 pct in 3 months to March 28
* Sees earnings above 2013 level this year, rather than next
* Shares up 9 pct, hit four-month high
(Adds CEO comments, analyst comments, shares)
By Paul Sandle
LONDON, May 22 British retailer Halfords Group
Plc has posted a sharp rise in cycling sales, helping
yearly profit beat expectations and boosting its shares more
than 9 percent.
Halfords is benefiting from an upsurge in the popularity of
cycling after British successes in the London 2012 Olympics and
the Tour de France, while the start of the latter competition in
Yorkshire, northern England, in July will make another landmark
year for the sport.
The company - among Britain's biggest seller of bicycles -
said like-for-like sales of cycles and cycling gear, ignoring
new store openings, rose 41.6 percent in the three months to
March 28, giving 19.4 percent growth in the category for the
Chief Executive Matt Davies said the group had broadened its
model range, particularly for women and young cyclists, and was
also selling more clothing and accessories.
"We see this as a really exciting year for cycling and we're
really well positioned," Davies told reporters on Thursday.
"Clearly there's The Giro d'Italia, the Tour de France, the
Commonwealth Games, and we've got some great products."
The Giro d'Italia diverted from its usual route around Italy
to start in Belfast this month, while the Commonwealth Games in
Glasgow from July could involve further successes for British
The Tour de France has been won by British riders Bradley
Wiggins and Chris Froome in the past two years.
While mild weather helped Halfords' cycling sales, it had
the opposite result on car maintenance products like batteries
and antifreeze, with sales falling 0.5 percent in the final
quarter, Davies said.
Full-year adjusted pretax profit rose 1.1 percent to 72.8
million pounds ($122.9 million) against an average forecast of
70.1 million, on revenue up 7.9 percent to 939.7 million.
Its shares, which have risen by 38 percent in the last 12
months, were trading up 9 percent at 482 pence at 0912 GMT,
having hit a four-month high of 490.5p.
Analysts at brokerage Investec upgraded their pretax profit
forecast for the year to end-March 2015 by about 7 percent to
75.8 million pounds after what they said was an "eye wateringly
strong exit to the year from cycling".
Davies, who joined the group 18 months ago, is implementing
a 100 million pound turnaround that includes store revamps, new
ranges and staff training.
Chief Financial Officer Andrew Findlay said the plan was
delivering results and saw core earnings exceeding the 103.4
million level recorded in 2013 in the current financial year,
rather than next.
"We are comfortable to give guidance that's come forward one
year," he said. "Consensus (of analyst expectations) was already
there, but we're confirming that's the view we take as well."
($1 = 0.5925 British Pounds)
(Editing by Sarah Young and David Holmes)