Halfords has raised its profit forecasts for 2015 despite warning that it will take a hit from the increase in national insurance announced in the Budget.
The garage to bicycle chain said underlying profits before tax would now reach £37m compared to £32m previously forecast.
The company said year on year Q3 delivered 10.3% sales increase in its service, maintenance and repair (SMR) business.
In an update Halfords said: “Despite the recent positive performance, there remains considerable uncertainty regarding the outlook for the UK consumer in light of measures introduced by the Autumn Budget, which take effect from April and hence are in force for the entirety of FY26.
“While the impact of changes to the minimum wage and national insurance contributions are relatively easy to quantify, adding £23m to our direct labour costs in FY26 alone as announced in November, their effects on the demand environment and health of the broader economy are harder to predict.
“We also continue to expect to see inflation passed through on managed services. We continue to work on possible mitigations for the additional costs we face and will share our plans alongside our FY25 results.”
