Halfords proposes 23 Cycle Republic store closures

Halfords Group has outlined aims to close its Cycle Republic brand, which would involve shutting its 23 stores. The closures will include the Boardman Performance Centre, a facility dedicated to performance cycling. Its features include a cycling-specific wind tunnel.  Halfords said it is “actively exploring opportunities to sell the sites as a going concern”.  Subject to the outcome of negotiations and consultation – which affects 226 jobs – the stores are expected to close during the first half of its 2021 financial year. The group pointed to the “challenging economics of a store-based dedicated performance cycling operation”.  Halfords said that exiting a low-returning, stock intensive business will allow it to improve its return on capital and free up investment, with an emphasis on growing its motoring businesses.  It will continue to offer performance cycling services through its Tredz brand, which mainly operates online.  The group expects to incur around £25-35m pre-tax exceptional costs associated with the process, subject to the outcome of the consultation, with the majority being cash costs.  Most of these cash costs will relate to its retail store lease arrangements and will be incurred over the period of the remaining leases, which have an average length remaining of 4.9 years.  Graham Stapleton, chief executive, said: “The board has come to the difficult, but necessary, decision to propose the closure of Cycle Republic, our retail store-focused performance cycling brand. “Going forward we propose to focus our investment and resources in Halfords and Tredz, through which we will deliver market-leading specialist propositions for both mainstream and enthusiast cyclists via a business model that improves our overall economics.” To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette