Our updated strategy builds on our strong fundamentals, focusing on disciplined execution rather than radical change to leverage the key strengths of our business: a trusted brand leading in attractive markets, unrivalled scale and expertise, a hard-to-replicate services offering, financial resilience and significant opportunity from technology and data."
Fit for the Future
Our updated strategy reflects a simple but important shift in emphasis: from building the platform to executing it with consistency and focus.
Halfords is entering its next phase with a clear and disciplined strategy focused on unlocking the full value of the platform we have built. In recent years, we have expanded our capabilities across Retail, Garages, mobile services and B2B, creating a uniquely integrated model.
We are concentrating on improving operational performance, strengthening our foundations and, ultimately, scaling proven capabilities. This approach ensures that near-term value creation and longer-term growth are delivered in a balanced and sustainable way.
Enabled by our team
Delivering this requires clear leadership, sharper priorities and stronger accountability across the Group. Our strengthened Executive Team brings new leadership across key areas of the business, including in Retail, Garages, technology and data.
Together, the team is focused on building a stronger performance culture, simplifying activity and improving delivery cadence. This means fewer priorities, clearer ownership and greater focus on the initiatives that create value for customers, colleagues and shareholders.
Our strategy
Our strategy ahead is simple, disciplined and built around three clear phases: Optimise, Evolve and Scale. These phases are time-bound but overlapping, designed to realise near-term benefits but also prepare us for the long term, with opportunities to invest to build real value within a relatively short timeframe.
Our current priorities
Optimise
Building near-term value through disciplined and focused execution.
Objectives
Improve returns from the platform already built across Retail, Autocentres and B2B, enabled by digital, loyalty and the Halfords brand.
Drive stronger Garage profitability by increasing utilisation, matching labour supply and demand, and supporting our customers through higher-value service, maintenance and repair work.
Strengthen Retail execution through category management, range design and customer journeys, both online and in stores.
Grow customer lifetime value by increasing frequency, retention and cross-shop across Halfords’ products, services and channels.
Use data and insight more effectively to support pricing, promotions, personalisation, service reminders and better trading decisions.
Maintain capital discipline by prioritising a strong balance sheet and investment in initiatives, driving clear returns.
FY26 outcomes
103
Fusion locations delivered
420k
Premium Motoring Club members
14.2%
return on capital employed
Progress on Optimise
Optimise is gaining traction, with progress delivered against the strategy’s key financial metrics, including sales growth, improved profitability and increasing ROCE.
Autocentres delivered operating margin expansion through revenue growth in customer garages, particularly in higher-margin service, maintenance and repair work, progress on the Fusion programme, and better utilisation as a result of a focus on operational excellence across our estate.
Foundations were laid for our category management approach in Retail, restructuring the team, bringing in additional capability and relaunching our first four categories. Our pricing and promotion strategies became more data-driven, with machine learning tools improving feedback loops and supporting margin delivery.
Investment in our brand and digital platform will help us to unlock the value of our Group, more effectively bringing together our unique portfolio of physical and digital assets to drive improved returns.
Evidencing our progress
Alongside our updated strategy we set clearly defined delivery metrics to evidence our progress. Six months in, we have shown good progress across the board.
Outcomes | ||
|---|---|---|
LfL sales growth | +4.8% | ✓ |
Operating margin expansion | Flat | - |
Progression in underlying PBT | +4.1% | ✓ |
ROCE > cost of capital | 14.2% | ✓ |
Guardrails | ||
|---|---|---|
Cash investment £55m-£65m | £58.1m | ✓ |
Leverage < 0.8x underlying EBITDA | (0.1x) | ✓ |
Dividend 1.5x to 2.5x covered by underlying profit after tax | 1.7x | ✓ |
Bringing Garages to Life
Our future priorities
Evolve
Driving structural efficiency and enabling future growth.
Objectives
Our data potential is vast and we have already implemented highly effective tactical programmes to reduce our costs. We now have a significant opportunity to invest in our technology, harnessing this data to elevate customer experience and drive structural efficiencies in our model.
Upgrading our supply chain, improving efficiency, automating key processes, reviewing location strategy and increasing resilience.
Re-engineering our ERP, building leaner and smarter central processes, unlocking enhanced data-driven decision-making, making better use of AI and automation and improving inventory management.
Upgrading our systems, including point of sale and garage management, and enhancing our customer data capabilities, implementing new data tools and introducing predictive and personalised analytics.
Our future priorities
Scale
Expanding reach, taking advantage of operating leverage.
Objectives
Garages
Expand our physical garage footprint to ensure comprehensive geographical coverage.
Following the successful completion of the “Optimise” and “Evolve” phases, we will have a highly efficient Motoring Services platform ready for further expansion.
Retail
Grow our addressable market and appeal through improved digital channels and a one-stop shop.
We have the opportunity to grow in both existing and new markets through our unique digital and data assets. We can broaden our offer through a one-stop shop addressing all of the customer’s motoring needs achieved with a capex-light growth option executed via strategic partnerships.