Halfords Group (HFD) H1 2026 & Strategy Update earnings summary

Executive summary

• Outlined a five-year phased strategy (Optimise, Evolve, Scale) focused on optimizing, evolving, and scaling the business, leveraging unique assets, market positions, and a shift to a service-led, B2B-diversified model, now representing over half of revenue.

• Delivered strong HY26 results with 4.1% like-for-like sales growth, led by 9.0% in Cycling and robust performance in Retail and Autocentres.

• Leadership team refreshed with experienced hires to drive operational excellence, cultural change, and simplification.

• Maintained a strong, debt-free balance sheet and robust cash flow, supporting disciplined investment and growth.

• Leading provider of motoring and cycling services with c.20m customers, c.6m Motoring Club members, 370 retail stores, 498 garages, and 800+ service vans.

Financial highlights

• Group revenue increased to £893.3m for HY26 (+3.3% YoY), with annual revenue at £1.7bn and underlying PBT of £38.4m.

• Achieved £90m in cost savings over three years, offsetting £98m in cost inflation.

• Net cash position of £18.6m, with leverage (including leases) at 1.3x and a £180m debt facility to April 2029.

• Motoring Club premium membership generated £20m in annual recurring revenue, with nearly 6 million members and over 400,000 premium subscribers.

• Gross margin expanded by 200bps to 51.4% in HY26, the highest since FY22.

Outlook and guidance

• Confident in delivering FY26 underlying PBT in line with consensus (£36.0m–£40.7m), with continued like-for-like sales growth, digital outpacing physical, and operating margin expansion.

• CapEx guidance maintained at £55m–£65m per annum, with incremental investment only after demonstrating progress.

• Dividend policy unchanged, prioritizing balance sheet strength and progressive dividends as profits grow.

• ROCE expected to grow above cost of capital, with prudent leverage capped at 0.8x adjusted EBITDA (excluding leases).