British retail giant Halfords has seen its cycling revenue grow slightly, after "positive signs of recovery" in the bike market this year.
In its 2025 annual report, published this week, which deals with the period up to 28 March 2025, cycling revenue was revealed to have grown by 1.7% over the previous financial year, as profit before tax grew by 6.4%.
This is a marked contrast to last year, when it recorded a 25% year-on-year fall in profits, citing a “decline in cycling” as a contributing factor. In an accounts filing made this week, the company posted a pre-tax profit pf £38.4 million across all operations, up from £36.1 million the year before.
Keith Williams, the company's chair, said: "With challenges in our end markets and several years of inflationary headwinds, our focus in FY25 was on controlling the controllables: focusing on our customers, driving efficiency in our operations, and improving the underlying profitability of the business. The numbers reported for FY25 represent an excellent result in difficult conditions, delivering growth on our bottom line despite £33m of inflationary headwinds."
According to chief financial officer Jo Hartley, cycling outperformed predictions.
"In Retail, our services-led, specialist proposition resonated well with customers and resulted in LfL [like-for-like] sales growth of 2.1% compared to the previous period, with total Revenue reaching £1,004.9m," she wrote.
"Pleasingly, growth came from both Motoring and Cycling sales, with both performing ahead of our initial expectations and accelerating through H2. Cycling performed particularly well in the final months of the year, with kids' bikes, Cycle2Work and Tredz continuing to be the stronger categories."
Known for its motoring business, Halfords is the largest retailer in the UK cycling industry. It sells a range of bikes, including in-house brands Boardman and Carrera.
The cycling industry has been beset by multiple challenges in recent years, many of which date from the Covid pandemic. "Survive to 25" was the mantra, although some business were forced to cease operations.
Henry Birch, Halfords' new chief executive officer, wrote: "In the cycling market, assisted by warm spring weather, we have seen positive signs of recovery in recent months. The cycling market has faced numerous challenges in recent years.
"Products are manufactured on long lead times and the industry found itself with significant excess inventory when the pandemic boom gave way to a cost-of-living crisis and associated collapse in demand that has persisted for some time. Halfords' inventory has been well-managed throughout; however, the industry has been highly promotional through a period of consolidation.
"While our cycling business has undoubtedly been impacted by these factors, our scale in the market and focus on exclusive brands has enabled us to be more disciplined in our promotional activity while increasing our market share in the post-pandemic period."
The CEO added that Halfords has invested in new cycling products, with more premium Boardman bikes, and growing its Cycle2Work business.
