Pre-tax profits at Halfords have dropped by almost a quarter, with the company saying it will look to cut costs and drive efficiency as it battles a “challenging UK consumer environment”.

In a statement to the London Stock Exchange, the company said revenues were up 1.1 per cent from £1.135 billion in 2018 to £1.138bn for the year ending March 29, 2019.

However, pre-tax profits had dropped from £67.1 million to £51m for the same period – down 24 per cent.

Extremely mild weather, it said, had taken a bite out of its motoring retail performance (down 0.4 per cent on a like-for-like basis) but had boosted its cycling like-for-life revenue to the tune of 2.6 per cent.

Weakened consumer confidence in the run-up to Christmas, retail inflation and investment in strategic projects were also cited as reasons for the decline in profits.

On the flip side, online sales grew by 9.6 per cent, and now account for 20 per cent of the group’s total sales it said, adding that Service-related sales now account for almost a quarter of the group’s total sales.

The company said it expected pre-tax profits for 2020 to remain broadly in line with 2019, and assumed “average weather conditions” and the “consumer and economic outlook” to remain the same. 

“As a business we are continuing therefore to put greater emphasis on improving our cost base and maximising efficiencies across the group,” it added.

“This change in emphasis will be key to underpinning profit growth in FY21.

Halfords chief executive, Graham Stapleton, said: “Halfords Group has delivered sales and Free Cash Flow growth in what remains a challenging UK consumer environment.

“Since launching our new strategy, we have seen encouraging early progress. As we strengthen our unique services proposition, customers are responding positively, and we are particularly pleased that nearly a quarter of all Halfords sales are now service related.

“Consumer confidence remains fragile; however, we remain confident that the strength of our customer offer, our people, our strategy and clear focus on our medium-term financial targets leave us well-placed for long-term sustainable growth.”

The proposed full-year ordinary dividend per share is 18.57p – up 3 per cent on the 18.03p in 2018.