Halfords has delivered a sharp rebound in fortunes, with shares surging after the retailer revealed stronger sales, rising profits and a transformation strategy beginning to pay off.
The motoring and cycling group reported revenues of £1.8 billion for the year to April 3, up 4.8 per cent on a like-for-like basis, as growth in vehicle servicing and demand for e-bikes helped offset a challenging consumer backdrop.
Shares jumped around 14 per cent following the update, as investors welcomed evidence that the company’s shift away from traditional retail towards higher-margin services is gaining traction.
Halfords’ autocentres division was the standout performer, with sales rising 5.8 per cent as customers continued to prioritise essential vehicle maintenance. The company has expanded its “Fusion” garage model, combining retail outlets with repair facilities, and has now opened more than 100 sites.
The move reflects a broader strategy to make Halfords less dependent on discretionary spending and more focused on recurring automotive services.
Chief executive Henry Birch said the company had absorbed millions of pounds of inflationary pressure, including higher wages and increased National Insurance costs, while still delivering profit growth.
“We have countered £40 million worth of inflation,” he said, arguing that efficiency improvements rather than job cuts had driven the turnaround.
The retailer has also positioned itself for the electric vehicle transition, investing in EV servicing equipment across its network and preparing staff for a changing automotive market.
Cycling proved another bright spot, with Halfords reporting strong demand for e-bikes and plans to expand its range of electric mountain and hybrid models.
The company’s recovery comes after a difficult period, with Halfords previously struggling against rising costs and weaker consumer confidence. It returned to a pre-tax profit of £43.6 million, compared with a £30 million loss the previous year.
However, executives remain cautious about the months ahead. The company warned that wider economic uncertainty could still weigh on household spending, particularly if consumers begin cutting back on non-essential purchases.
Halfords said early summer weather had boosted sales of cooling products, car accessories and staycation-related items such as roof boxes and cycling equipment.
The results mark a significant shift for a retailer attempting to reinvent itself — transforming from a high street car accessories chain into a broader automotive services business built around repairs, technology and changing consumer habits.
Leave a Comment