Halfords Sales Rise But Consumer Outlook Uncertain, Shares Jump

Halfords (LON: HFD) rose sharply on Tuesday after the motoring and cycling services retailer reported a strong finish to its financial year and said profit would come in near the top of its guidance range.

Halfords also announced that CEO Graham Stapleton will step down after seven years, with Henry Birch taking over leadership this week. 

The company’s shares are up 9.8%, not long after the open, trading above the 136p mark.

For the 52 weeks to 28 March 2025, Halfords reported like-for-like sales growth of 2.3% across the group, building on a 5% rise the previous year. 

Gross margin improvements accelerated in the second half, driven by pricing optimisation and favourable currency hedging, helping offset over £30 million of inflation, according to the firm.

Meanwhile, underlying profit before tax is expected to be around the upper end of the previously guided £32 million to £37 million range. 

The group also said it outperformed its £30 million cost-saving target.

Halfords highlighted strong growth in its Autocentres division, with like-for-like sales up 3.7%, while retail sales also turned positive in the second half. 

The company added that its Fusion rollout has delivered up to 50% sales uplifts at converted sites.

Halfords Motoring Club membership has surpassed 5 million, accounting for nearly half of MOTs and generating £18 million in annualised subscription revenue.

Despite the solid performance, the company warned of a volatile retail environment and uncertain consumer outlook, particularly amid rising labour costs.

“We expect to be able to mitigate the entirety of the direct inflationary impact of the Autumn Budget in FY26. However, retail sales remain volatile and the consumer outlook is uncertain,” the company said.