Halfords warns that budget fears make near-term outlook ‘uncertain’

Halfords Group has warned that uncertainty about the economy and forthcoming tax changes in the budget next week have led consumers to delay spending on pricier purchases.
The retailer and repair shop, which sells bicycles, leisure equipment and car parts, reported that like-for-like sales had slipped 0.1 per cent for the 26 weeks to September 27, compared with the same period last year.
Halfords, which employs about 12,000 people in the UK at 377 retail stores and about 650 garages, said “despite pockets of improving consumer sentiment” the outlook in the near-term continues to be “uncertain” as shoppers remain wary of making big ticket purchases.
Like-for-like sales in Halfords retail division, which makes up around 60 per cent of the group’s revenue, declined by 0.7 per cent in the 26 week period as its leisure cycling range struggled with a wet spring. The retailer said record levels of rainfall over the spring contributed to weaker retail sales, which dipped 0.7 per cent year-on-year.
The Halfords Autocentre service and repair unit, which is responsible for 40 per cent of the group’s sales, remained resilient. Like-for-like sales in the division increased 0.8 per cent in the 26 weeks to September 27, compared with the same period last year, as customer demand for services, repairs and maintenance grew.
The company, founded in 1892, enjoyed a boost during the Covid pandemic, when more people took to cycling and had spare cash to spend on bikes and cars as lockdowns boosted household savings. This cycling boom has since faded following a slowdown in consumer spending.
Graham Stapleton, chief executive of Halfords, said: “While consumers remain cautious in their discretionary spending compounded by uncertainty around the contents of the upcoming Autumn Budget, we have continued to focus on controlling the controllables and I am pleased with our performance in the first half of 2025.”
However, he added that two of the group’s core markets remained “significantly below pre-Covid levels”.
Halfords said it expects to make savings of £30 million this year, which are aimed at mitigating around £35 million in inflation costs.
Manjari Dhar, an equity analyst at the Royal Bank of Canada, said: “Near term, we expect continued market weakness in tyres and cycling, but we see potential for some recovery in the motoring market, given some improvements in UK consumer sentiment recently.”
Shares in Halfords closed up 15¼p, or 10.7 per cent, to 157¼p.
⬤ Wickes Group reported a 2.6 per cent increase in like-for-like revenues during the third quarter as the home improvement retailer increased its market share. Revenues rose to £391.3 million in the 13 weeks to September 28 as the company benefited from consumers catching up on DIY projects which had been delayed by the wet summer weather. Wickes said that retail sales were likely to wane in the final quarter of the year as pent-up demand subsides.