Halfords Profit Rises, Faces £49m Retail Impairment

Halfords Group reported an underlying pre-tax profit of £38.4 million for the year ending March 28, 2025, surpassing market expectations, helped by £35 million in cost savings, higher pricing, and increased demand for higher-margin services. Despite these gains, the company posted a statutory pre-tax loss of £30 million, driven by a £49.1 million non-cash impairment related to its retail business, reflecting higher discount rates from rising UK gilt yields and anticipated rises in labour costs. The group’s revenue remained steady at about £1.71-1.72 billion, with like-for-like sales up 2.5%, and notable growth in sales of kids' bikes and services. As part of a strategic review, Halfords plans to close certain under-performing garages and stores, citing increased labour costs, a fragile consumer outlook, geopolitical instability, and higher UK unemployment. CEO Henry Birch emphasized the company's strong financial performance and its strategy to manage inflationary pressures. Early trading in fiscal 2026 is said to be in line with expectations, and a final dividend of 5.8p per share was proposed.