Halfords Group PLC (LSE:HFD) shares jumped more than 9% on Tuesday after it upped mid to long-term guidance during its capital markets day.
Revenue is expected to reach £1.9bln in the coming years from £1.6bln in 2023, while pre-tax profits are forecast to grow to £90-£110mln outperforming 2023 guidance of £50-£60mln.
The cycling and motoring products retailer shares have dropped more than 22% in the last twelve months, with the group cutting earnings guidance in its most recent financial update.
However, the newly cited growth is largely down to a change of strategy at the Redditch-based business.
In 2018, Halfords began transitioning its focus towards motoring and away from cycling, offering services to both consumers and other businesses.
“We have doubled the size of our B2B and services business and have become the UK’s biggest motoring services provider, increasing our group sales by 40%,” Graham Stapleton, chief executive officer at Halfords, said.
The group says it plans to “create a one-stop-shop” for drivers.
Halfords also hopes to become one of the market leaders in servicing electric cars, vans, scooters and bikes.
In the long-term, the group believe sales could reach £2.2bln and underlying earnings could grow to between £130mln-£150mln.
The board has proposed a 7p final dividend, increasing the full-year payout for 2023 to 10p per share.