LONDON (Reuters) – Shares in British bicycles and car parts retailer Halfords soared as much as 24% on Monday, boosted by the government’s announcement that people should consider cycling to work when the coronavirus lockdown is eased.
Transport minister Grant Shapps said on Saturday that even with public transport reverting to a full service, once social distancing rules were taken into account there would only be effective capacity for one in 10 passengers in many parts of the UK transport network, just a tenth of the old capacity.
He urged people to continue to work from home where possible, but said those who did have to commute to work should consider cycling or walking, rather than taking to their cars.
Shapps also said E-scooter trials would be brought forward, with the potential for rental vehicles on UK roads as early as June.
Halfords is Britain’s biggest cycling retailer with 450 repair centres, and is also market leader in E-scooters.
“Saturday’s evangelical Department of Transport speech could have been written by Halfords’ CEO, with its very helpful remarks on cycling and E-scooters,” said analysts at Peel Hunt.
“We have generally been loath to forecast V-shaped post-Covid recoveries but this might be different. Our new numbers today reflect a very strong bounce-back in sales and EBITDA, (core earnings),” they added.
On Monday Halfords launched a campaign aimed at the seven million British adults who have bicycles languishing in sheds and garages. It said it will provide a free “32-point” check on neglected bikes to help people get ready for the post lockdown commute.
The stock was up 36.4 pence at 187.2 pence at 0738 GMT, paring year-on-year losses to 24%.
(Reporting by James Davey; editing by Sarah Young)
