Tuesday, 11 February 2025
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Halfords reports Christmas gifting boost for cycling

Halfords has reasons for cheer according to its latest financials, seeing Christmas gifting help boost its bottom line, freight costs anticipated to be below expectations and a general sales uplift.

Halfords’ retail arm traded well over the peak trading period, with the group stating its product and promotional proposition “resonated well with customers, notably in cycling”. In cycling, Christmas gifting contributed to like-for-like sales growth of 13.1% in December.

On top of that, freight headwind is now expected below the previously guided £4m-£7m range.

Halfords previously said it expected market volatility through the first half of FY25, continuing through the second half of the year. But a trading improvement in recent months and progress on key initiatives including pricing, promo strategies and cost reduction measures had boosted expectations: “Cumulatively, these factors lead us to expect FY25 underlying profit before tax of £32m to £37m.”

FY26 and beyond

Like a number of big businesses, Halfords took issues with the 2024 Autumn Budget, which take effect from April: “While the impact of changes to the minimum wage and national insurance contributions are relatively easy to quantify, adding c.£23m to our direct labour costs in FY26 alone as announced in November, their effects on the demand environment and health of the broader economy are harder to predict.

“We also continue to expect to see inflation passed through on managed services. We continue to work on possible mitigations for the additional costs we face and will share our plans alongside our FY25 results.”

Image by Alexandra_Koch from Pixabay

 

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