StockMarketWire.com - Halfords scrapped its dividend and capital spending plans to preserve cash after warning that performance could fall short of expectations amid the Covid-19 pandemic.

'Given the latest government guidance, we believe there is a high likelihood that sales will drop sharply and, if so, that the shortfall will have an impact on profitability, such that 2020 underlying pre-tax profit, on a 52-week and pre-IFRS16 basis, could be at the lower end of, or slightly below, the current guidance range of £50-to-55m' the company said.

Halfords said it would undertake a range of measures to preserve cash, including the suspension of the dividend, negotiations with landlords regarding rent relief, and the postponement capital commitments to well below current guidance of £40m-to-£60m.

'Based on the median sales scenario, and the measures we have outlined above, we are confident that we can operate within our existing debt facilities throughout 2021, the company said.

At 9:00am: [LON:HFD] Halfords Group PLC share price was +11.25p at 71.45p



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