Redditch-based Halfords is expecting its best ever camping season despite the washout weather of the last few weeks.
The retailer said its sales were boosted by strong demand for cycling, camping and travel equipment during the three months to early July.
Good weather during the period and the government’s Cycle2Work scheme which provides tax-free bikes for commuters helped the firm increase like-for-like sales by 1.3 per cent in the 13 weeks to July 3. Adjusting for the impact of Easter, the figure was 0.1 per cent higher.
Halfords financial director Nick Wharton said he was happy with the firm’s performance during the period. “We’re very pleased with what we see as a solid start to our financial year but there is no doubt the consumer situation remains challenging,” he said.
Halfords said its leisure category made an excellent start to the season because of the early summer sunshine and Mr Wharton was confident about sales of camping equipment despite a rainy July as many people bought camping equipment at the first sign of good weather during May and June.
“What we have seen is people wanted one of our tents for the summer holiday in August but because the weather was good in the spring they might have bought it in May.
“We believe we will have our strongest camping season ever,” he added.
Car maintenance also traded positively, assisted by new products and the success of the company’s in-store fitting service, with the number of jobs performed by staff rising 50 per cent on the same quarter a year ago.
Halfords launched a new campaign to get more children cycling after research commissioned by the firm revealed that 97 per cent of parents think the government should reduce VAT on children’s bikes and accessories from 15 per cent to five per cent.
Looking ahead, Mr Wharton remained cautious about the firm’s outlook for the rest of the year despite short-term signs of a pick-up.
“We think the consumer is a little bit better off at the end of the month and therefore has got a little bit more disposable income they might invest in a bike for their children or for themselves.”
But he said a combination of the VAT reverting to 17.5 per cent next January, rising unemployment and tax increases on the horizon meant the firm was keeping a cautious outlook.
“If you put that together – and we are not economists we are humble retailers – it’s reasonable to assume that entering into 2010 will be just as challenging for us if not more challenging,” said Mr Wharton.
