Halfords has increased its profit expectations for the 2025 financial year, after witnessing sales growth in the third quarter in both its retail and autocentres divisions.

The motoring and cycling products retailer said its retail division had "traded well" across the peak trading period. It stated that its product and promotional proposition "resonated well" with customers, particularly in its cycling sector, where sales growth increased by 13.1% in December.

Halfords also added that its autocentres division saw a "strong performance" in the "more profitable and strategically important" services, maintenance and repair (SMR) market. In this time, like-for-like (LFL) SMR sales increased by 10.3% in Q3.

The firm added that its current trading has benefited from the colder weather in more recent weeks, with motoring product delivering LFL sales growth in January of 5.5%.

As a result, Hargreaves Lansdown has reported that shares at Halfords increased by 18% following the latest trading update.

Looking ahead, the retailer said it had noted "ongoing market volatility" throughout the first half of the 2025 financial year and that this is expected to continue into the second half.

Despite this, Halfords has seen an improvement in trading, alongside progress on a number of key initiatives, leading it to expect an increase in its profit before tax to between £32m-£37m.

However, it did state that there remains "considerable uncertainty" regarding the outlook for the UK consumer following the measures introduced in the Autumn Budget.

Head of money and markets at Hargreaves Lansdown, Susannah Streeter, concluded: "Halfords has been pedalling hard to win custom in a tough consumer environment and it has been rewarded for its efforts.

"Even the warning about post-Budget uncertainty couldn’t dispel the feel-good factor that these results have unleashed. Halfords had already shown signs of making good progress when it comes to efficiency savings, and there will be hopes that this trend will mitigate the increase in wage bills.

"The motoring loyalty club, which offers discounts on certain services, has also been attracting new joiners at an impressive pace over the past year, with subscribers more likely to be engaged, shopping more frequently and spending more per visit."

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