Halfords and Carpetright cut profits estimates
- 7 April 2011
- From the section Business
Retailers Halfords and Carpetright have both issued profit warnings, as UK consumer spending remains tight.
Car and bike specialist Halfords cut its 2011 estimate for profits before tax to £124m-£127m, down from guidance of more than £127m given in January.
Meanwhile Carpetright said that profits for the financial year that ends this month would be down on a year earlier.
The carpet firm blamed "tough trading conditions" and "fragile consumer confidence" in the UK.
Carpetright said profits would be broadly in line with those of two years ago, implying a 25% fall from its 2010 results.
Likewise, Halfords blamed the "tougher consumer environment" as well as "product cost pressures" for its results falling short in its trading statement.
Total group sales were up 4.6% for the year, but in its retail sales divisions - which exclude Halfords' car-servicing business line - they were down 5.3%.
Nonetheless, the company's lower profit guidance still represents an improvement on the £110m it made in the previous year.
"We believe the environment will remain difficult for customers," said David Wild, Halfords chief executive.
The company said it was responding with new trading initiatives, such as a new line of premium cycles as well as spending on a new marketing campaign.