Halfords Group plc
Annual Report 2007
Halfords Group plc Annual Report 2007 CONTENTS
Financial and Operational Highlights 01
Our European Coverage 02
Chairman’s Statement 04
Chief Executive’s Review 06
Finance Director’s Report 18
Corporate Social Responsibility 21
Board of Directors 22
Directors’ Report 24
Corporate Governance 26
Directors’ Remuneration Report 30
Statement of Directors’ Responsibilities 36
Independent Auditors’ Report 37
Consolidated Income Statement 38
Consolidated Balance Sheet 39
Consolidated Statement of Changes in Shareholders’ Equity 40
Consolidated Cash Flow Statement 41
Notes to the Consolidated Cash Flow Statement 42
Accounting Policies 43
Notes to the Financial Statements 48
Five Year Record 63
Parent Company Accounts Under UK GAAP 64
Company Balance Sheet 65
Accounting Policies 66
Notes to the Financial Statements 67
Shareholder Information 70
Company Information IBC
www.halfordscompany.com
www.halfords.com
Welcome to
Halfords
Halfords is the UK’s leading retailer,
on the basis of turnover, in each of
the three product markets in which
it operates.
Leisure
Car Maintenance
Car Enhancement ■ Revenue up 9.1%, with like-for-like sales up 6.0%
■ Growth in all key categories of Car Maintenance, Car
Enhancement and Leisure
■ Far East sourcing penetration increased to 20%
■ Partnership with Chris Boardman to launch new range
of Boardman Bikes announced
■ First Central European store opens in Prague on
29 June 2007
■ 426 Halfords stores now trading including two stand-
alone Bikehut stores opened in Brighton and Putney
■ 23 new store openings
REVENUE
+9.1%
to £744.0m (2006: £681.7m)
£628.4m
2005
£681.7m
2006
£744.0m
2007
OPERATING PROFIT
+4.9%
to £93.5m (2006: £89.1m)
£89.3m
2005
£89.1m
2006
£93.5m
2007
PROFIT BEFORE TAX AND
EXCEPTIONAL FINANCE COSTS
+8.4%
to £83.5m (2006: £77.0m)
£73.8m
2005
£77.0m
2006
£83.5m
2007
PROFIT BEFORE TAX
+5.1%
to £80.9m (2006: £77.0m)
£74.3m
2005
£77.0m
2006
£80.9m
2007
BASIC EARNINGS
PER SHARE
+9.3%
to 25.8p (2006: 23.6p)
23.7p
2005
23.6p
2006
25.8p
2007
DIVIDEND PER
ORDINARY SHARE
+8.6%
to 13.85p (2006: 12.75p)
12.0p
2005
12.75p
2006
13.85p
2007
HIGHLIGHTS
extra mile
we go the OUR EUROPEAN COVERAGE
02/03
Halfords Group plc Annual Report and Accounts 2007
Halfords has 426 stores across the UK and
Republic of Ireland adding a further 18 stores
for the complete year.
2005 2006 2007 2005 2006 2007
■ 2 stores
■ 4 planned for 2007
Run by cyclists, for cyclists, there are two
Bikehut stores open in Putney and Brighton,
with plans for a further four by Christmas
2007.  Enthusiastic and highly knowledge
colleagues set the tone for these stand alone
stores which offer leading cycle and cycle
accessory brands such as Condor, De
Rossa, Endura and Gore-Tex.    
BIKEHUT
■ 376 stores
■ 12 planned for 2007
Halfords 376 superstores are located on
prime retail park sites across the UK and
Republic of Ireland.  Each superstore
typically spans around 9,000 square feet and
holds over 10,000 product lines and is
Halfords format of choice. The majority of
stores include a mezzanine option adding
around 40% of additional selling space.  
SUPERSTORES
■ 15 stores
■ 6 planned for 2007
Located in either market towns or urban infill
sites, there are now 15 Neighbourhood
stores successfully bringing the Halfords
brand to smaller catchments.  The next
financial year will see a further six open in
the same format, with a retail footprint of
4,000 square feet and each carry around
6,000 product lines.
NEIGHBOURHOOD STORES
3,200,000 sq ft
3,500,000 sq ft
3,600,000 sq ft
398 stores
408 stores
426 stores
FLOOR SPACE INCREASE STORE GROWTH Pilot stores
opening in the
Czech Republic.
CZECH REPUBLIC
CZECH REPUBLIC
Our first major step to the internationalisation of the
Halfords brand has been the establishment of a
regional office in Prague, complete with a local
team with extensive retail and buying expertise.
A full product offer has been developed for
Central Europe, with over 10,000 lines evaluated
to meet the needs of the local market.
■ 12 stores
■ 6 planned for 2007
Halfords product offering and store formats
have been very well received, showing
strong return on investment. By the end of
2007, the store portfolio will total 18 stores,
with further potential to exceed 20 stores in
the near future.  
REPUBLIC OF IRELAND
■ First store opened 
29 June 2007
■ Two further stores
opening autumn 2007
■ Three extra stores
targeted for 2008
The first Halfords store in the Czech
Republic opened its doors in Prague on
29 June. There will be three stores trading 
in the country by the end of the year.
CZECH REPUBLIC CHAIRMAN’S STATEMENT
04/05
Halfords Group plc Annual Report and Accounts 2007
I am pleased to report that Halfords has delivered a strong set of
results. Sales growth of 9.1% has been achieved which, with
reduced margin dilution, has generated earnings per share 
growth of 9.3%.
These results, together with the Board’s confidence in the
business strategy, enable the Board to recommend a final
dividend of 9.50 pence, which, with the interim dividend of 
4.35 pence, takes the total dividend for the year to 13.85 pence,
representing growth of 8.6% on last year’s dividend of 
12.75 pence.
Following Nick Carter’s resignation, the Board was pleased to
announce the appointment of Nick Wharton as Finance Director,
with effect from 3 February 2007. Paul McClenaghan was also
appointed to the Board with effect from 31 March 2007. On behalf
of the Board I would like to thank Nick Carter for his contribution
to Halfords and wish him well in his future career.
Nick Wharton is a Chartered Accountant and has been a member
of the senior management team at Halfords for five years, having
played pivotal roles in both Halfords’ separation from Boots
Company plc in 2002 and Halfords’ listing on the London Stock
Exchange in 2004. Through his role as Business Development
Director, Nick has been instrumental in developing the
international expansion strategy and new trading formats,
including the stand-alone Bikehut proposition.
Paul McClenaghan joined Halfords in 2005 as Trading Director. In
his time at Halfords, Paul has implemented strategies focused on
developing Halfords’ market leading positions in its core markets,
as well as expanding the product and service offerings into new
markets.
Nick and Paul join a strong Board team. The business is very
effectively led by our Chief Executive, Ian McLeod, and our
capable non-executive team of Nigel Wilson, Keith Harris and Bill
Ronald bring a wide range of experience to Board discussions.
The entire Halfords team, from colleagues based in stores through
to those in our head office and distribution centres, share a
common purpose of delivering market leading knowledge, choice
and service to our customers. Their hard work and dedication has
generated these strong results.
The Halfords brand was established in 1907, and it is encouraging
in our centenary year 2007 that the business is trading
successfully and we have every reason to be confident in the
future of Halfords.
Richard Pym, Chairman
6 June 2007
Richard Pym “The hard work and dedication
of the entire Halfords team has
generated these strong results.”
■■ COMPREHENSIVE SERVICE OFFERINGS
SERVICE EXPERTISE
With over 1.2m fitting jobs completed during the year, Halfords
wefit Service continues to enhance our product offering,
differentiates us from our competitors and positions store
colleagues as experts in their field.
Halfords comprehensive training programme delivered through a
combination of on the job training and 42 designated training
stores has resulted in: 
■ 2,000 trained and accredited child seat fitters
■ 1,500 specialists delivering our unique sat nav ‘set up and
demo’
■ 700 trained hard wire (in-car entertainment) fitters CHIEF EXECUTIVE’S REVIEW
06/07
Halfords Group plc Annual Report and Accounts 2007
During the financial year, Halfords has continued to deliver further
growth, demonstrating strong resilience to both a challenging
retail environment and changing market dynamics through a
combination of a differentiated offer, our unique service
proposition and a proactive trading approach.
The essence of Halfords’ successful business model lies in our
range differentiation, our service and strong defensive
characteristics. We are both market leader and store of first choice
in each of our key markets. We have the UK’s largest range of car
parts, a third of the UK cycle market and are now clearly
established as the UK’s leading provider of In-Car Technology
solutions. Our product offer is delivered from a portfolio of 426
stores, the significant majority of which are located in popular
retail parks throughout the country.
Our breadth of range and our scale of stores across the UK and
also within the Republic of Ireland, are underpinned by the
competitive advantage provided by the informed service and
product fitting capability of our store-based colleagues. Halfords
therefore possesses a combination of characteristics which
continue to provide a strong defence against any material form of
scale competition.
During the financial year, Halfords has built on its strong
performance in previous years by delivering a year-on-year sales
increase of 9.1% which includes growth across each of our key
categories. As well as maintaining sales momentum through a
similar sales growth profile in each half year, a proactive
management of the product mix and supplier base has also
enabled us to grow cash margin and significantly arrest the level
of percentage margin dilution experienced in the previous 
financial year.
We continue to successfully focus on each of the four key
elements of our business strategy: 
■ Investing in the store portfolio
■ Leveraging the Halfords brand
■ Improving the supply chain
■ Marketing the Halfords service proposition
■■ INVESTING IN THE STORE PORTFOLIO
In recent years our focus has been on reinvesting in the existing
store estate, to ensure that our store environment remains
contemporary and our customers are presented with our latest
offer. This programme, involving varying degrees of re-
invigoration, is now essentially complete. 
A combination of investment in our existing stores, often
increasing capacity through the addition of mezzanine floors, and
the opening of new stores has added 32% of space to our
portfolio since 2001. We believe our market leading position can
be further enhanced by the development of at least 130 further
stores across the UK and the Republic of Ireland. Our portfolio
investment emphasis will now move towards a stronger store
opening programme.
The Halfords Group now has 376 Superstores, with well over half
in a mezzanine format and over 100 stores in a supermezzanine
format, which remains our format of choice. As at 30 March 2007,
Halfords Group had a total of 426 stores trading, including two
stand-alone Bikehuts.
Ian McLeod “The essence of Halfords’
successful business model
lies in our range
differentiation and strong
defensive characteristics.”
■■ LEISURE
BOARDMAN BIKES
The new Boardman range of bikes designed by Olympic and triple
world champion Chris Boardman MBE (pictured above), places
Halfords at the forefront of specialist bike development offering
superior quality products at the most competitive prices. The
range of bikes and accessories available exclusively at Halfords
and standalone Bikehut stores includes road, mountain and
commuter bikes.
CAMPING RANGE
On the back of our success in 2006, we have further developed
our range for 2007 with the introduction of our Urban Escape
premium camping range. Product development continues to drive
sales growth in this attractive market, while a newly re-branded
sub shop identity has provided range clarity.
CARRERA
Fifty new models of the Carrera range have been introduced this
year. Carrera is Britain’s best selling premium cycle brand and
continues to grow supported by positive reviews from the
specialist cycling media. CHIEF EXECUTIVE’S REVIEW
continued
08/09
Halfords Group plc Annual Report and Accounts 2007
The Halfords re-branding strategy is complete with all stores now
in our orange livery (with the exception of three, which will close
this year). We will continue to invest in our existing estate through
ongoing mezzanine introduction, complemented by a series of
refresher activity and space rebalancing programmes, to ensure
that our current estate continues to benefit from improvements in
product display and adjacency. 35 such space rebalances took
place last year, with a similar level of activity planned for 2007/08.
Most of our store portfolio is located on prime retail parks with A1
consents, where an increasing number of retailers wish to
participate. Given our destination store status, this additional
demand enables us, in certain circumstances, to readjust our
store size (by introducing a mezzanine for example) or by
relocating completely. As this activity frees up incremental rental
space within the park we are able to negotiate contributions from
landlords to facilitate our portfolio programme.
Stores involved in such activity benefit from portfolio investment
either as a newly built replacement store or receive an upgrade to
the latest footprint. Significantly, each of the stores impacted by
these changes in the last two years has remained located in its
existing retail park, and achieved above average sales growth
following the change.
Recognising the quality of our store portfolio and our destination
status in the minds of our customers, we would envisage such
opportunities continuing at a similar level for the foreseeable
future.
Rental inflation has been accelerating in recent years, which has
proved challenging given the inherent cost growth. However, it has
become evident that rental inflation is now decelerating, which will
clearly be beneficial at future rent reviews.
■■ NEW FORMATS
We continue to develop new store formats and have focused on
two different customer propositions:
■ Neighbourhood stores
■ Stand-alone Bikehut
■■ NEIGHBOURHOOD STORES
Complementing Halfords’ traditional focus on full offer
Superstores, we have developed a smaller store format, known
internally as the Neighbourhood store. Stores of this nature
typically operate from a retail footprint of 4,000 ft
2
and carry 6,000
product lines compared to 9,000 ft
2
and 10,000 lines in a
Superstore.
These stores are proving successful in bringing the Halfords brand
to smaller catchments, such as Midsummer Norton and Aberdare.
The performance of the Neighbourhood stores opened to date has
proved encouraging, generating payback periods very similar to
our current Superstore portfolio. These stores will be located in
either market towns or urban infill sites and we believe there are
opportunities to develop about 60 stores in this format in the UK
over time.
The new travel and touring sub shop has been introduced to 249 stores
providing a dedicated shopping environment for customers. New products,
new packaging and in-store communications enable customers to better
understand the choices between different ranges and sales have shown an
increase since the introduction of the sub shop concept.
TOURING SUB-SHOP We have opened 15 of these stores to date, with a further six
stores planned to open in the Neighbourhood format in the new
financial year.
■■ STAND-ALONE BIKEHUT
Halfords has steadily grown its cycle and cycle accessory
business in recent years and established Bikehut as a credible
sub-brand within the market.
Our Apollo and Carrera own brand cycles have developed
considerably and now arguably lead the market in terms of value.
We have successfully supported the product offer with the
recruitment and training of specialist colleagues to advise
customers and also build and safety check their bikes for them. In
addition, Bikehut branded parts and accessories are now
established as an authoritative range of private label products and
an accredited cycle repair and full maintenance programme has
also been introduced.
This has placed us in a strong position to launch a number of
stand-alone specialist cycle shops under the Bikehut brand. Our
visible commitment to the premium sector of the market has also
attracted a broader range of specialist cycling brands to be
available in these stores, including Condor, De Rossa, Pashley,
Marzocchi, Endura and Gore-Tex.
Two initial pilot stores have opened in Brighton (November 2006)
and Putney (February 2007) with encouraging results. Compared
to our overall market share, we are under-represented in the
premium cycle market, which is characterised by a fragmented
population of independent specialist stores. We are confident we
can compete very effectively and through Bikehut can grow share
in this sector.
The store look and feel is completely different to a Bikehut sub-
shop within a Halfords store. It has a clear individual identity and a
large range which has a 60% difference to our Superstore offering,
in order to appeal to the specialist consumer.
We anticipate operating from six stores by the end of this year as
an extended pilot project and assuming success, intend to roll out
to approximately 50 stores across the country.
■■ INTERNATIONAL DEVELOPMENTS
The Republic of Ireland has been a very successful market entry
for Halfords with above average returns on investment being
generated from those stores opened to date. From only two stores
trading in January 2005, we are now trading from 12, with six
opening during the current financial year.
There is scope for approximately 20 Superstores in total with
further potential provided by our Neighbourhood format for
smaller catchments.
The Bikehut stand-alone concept was first
introduced in November 2006 and there
are now two stores trading in Putney and
Brighton with encouraging results. Sold by
dedicated and informed store colleagues,
product ranges are 60% differentiated from
those in mainstream Halfords stores to
cater for the specialist demands of the
cycling enthusiast.
BIKEHUT STAND-ALONE STORE CHIEF EXECUTIVE’S REVIEW
continued
10/11
Halfords Group plc Annual Report and Accounts 2007
Building upon the success and learning from our expansion into
the Republic of Ireland in recent years, this year has seen
unprecedented levels of activity in pursuing opportunities to take
the Halfords brand to new international markets.
Our first major step to the internationalisation of the Halfords
brand has been the establishment of an office in Prague in the
Czech Republic, complete with a local team with retail and buying
expertise, supported by functional experts in the UK. 
A full product offer has been created for the Central European
market, with over 10,000 lines evaluated to meet the needs of the
local market with product sourced either locally in Central Europe,
or through our UK and global supply partners. A complementary
in-country logistics infrastructure has been developed and
systems implemented.
The first store will open in Prague in the first half of this financial
year, to be followed by two further stores in the third quarter. The
combination of our wide and extensive ranges, high levels of
customer service and a full garage-servicing offer, will bring a
highly differentiated retail proposition to the Czech market. 
A programme of site identification and evaluation is under way to
take advantage of the growing and attractive market in the Czech
Republic and expansion in adjacent territories will follow after
evaluation of the pilot stores.
■■ LEVERAGING THE HALFORDS BRAND
The Halfords product portfolio comprises three major categories:
Car Maintenance (Car Parts and Servicing Consumables), Car
Enhancement (In-Car Technology and Performance Styling) and
Leisure (Cycling, Touring and Camping).
■■ CAR MAINTENANCE
Car Maintenance provides an underlying strength and stability to
our business, given the needs-driven nature of the product ranges
and we are pleased to see continued sales growth in this area.
Servicing consumables such as car bulbs, wiper blades, batteries
and oils comprise the significant majority of sales within this
category and benefit from two favourable dynamics. Firstly, they
inevitably need replacing if the consumer wishes to maintain a
legal and reliable vehicle on the road, providing Halfords with a
dependable customer stream given our ‘store of first choice’
status and breadth of range. Secondly, these products are non-
discretionary, needs-driven purchases with low price elasticity.
Our comprehensive stock of 3 million car parts (covering
approximately 93% of cars in the UK) and our market leading
authority ensures Halfords has strong product availability
consistent with consumer demand. A good example of our range
authority is that we carry over 80 different product lines of oil,
acting as a real competitive advantage as manufacturers become
increasingly specific about the oil that they recommend to owners
of their marque.  “Car maintenance provides
underlying strength and
stability to our business . . .
and we are pleased to see
continued sales growth in
this area.”
■■ CAR MAINTENANCE
CAR MAINTENANCE
Through our authority in car bulbs, wiper blades, batteries and
oils, this category provides an underlying resilience to our
business. Car maintenance products have continued to grow from
needs driven purchases, where extensive range breadth and high
levels of availability give Halfords a competitive advantage.  
SCRATCH, CHIP AND DENT REPAIR SERVICE
Customers across the country are now benefiting from this service
that rolled out nationally in October 2006.  With instant quotes
available from all Halfords stores, our Car Care Service offers
convenience and quality from the UK’s leading car parts retailer.
Services are performed by body shop trained technicians and
guaranteed for three years and include scratch, chip and dent
repair, bumper scuff repair, alloy wheel refurbishment and
professional valeting. CHIEF EXECUTIVE’S REVIEW
continued
12/13
Halfords Group plc Annual Report and Accounts 2007
New mobile phone legislation that came into
effect in February 2007 resulted in strong
sales of hands free phone solutions. In line
with Halfords profile as the UK’s leading
retailer of in car technology, all stores now
feature vibrant imagery and clear point of sale
allowing customers to choose from our
market leading range from Bluetooth
earpieces through to professionally, fully fitted
hard wire solutions.
HANDS FREE LEGISLATION
✔
✘
■■ CAR ENHANCEMENT
Car Enhancement continued to show growth during the year
reflecting an increasing emphasis, particularly by the younger
consumer, on enhancing the interior as opposed to the exterior of
their vehicles.
Targeting those customers, we have introduced new and
enhanced ranges aimed at broadening the appeal of our interior
accessory offer and have benefited from encouraging sales
growth as a result. 
The changing dynamics of the in-car electronics market has also
had a major impact, driven by innovation in technology and an
increase in own brand products. Our combination of market
leading range, knowledgeable colleagues and unique fitting
capability ensures that Halfords has the right technology solution
to meet customers’ requirements. Reflecting this service
advantage, across the total car enhancement category we fitted
over 275,000 technology solutions into our customers’ cars.
The trend towards digital music devices such as the iPod and
MP3 players and the desire to use these devices in-car has been
met with new product ranges being developed that allow the
customer to play their digital music through their car speakers.
This changing technology mix increased average retail prices
within this sector of the market in the second half of the year. Own
label mix of business has also significantly increased year on year
through the successful introduction of a number of own brand
products, including satellite navigation, in-car DVD and CD
players. Own brand accounted for over 20% of CD audio sales in
the year, driven by Ripspeed, which is now a top 5 UK in-car
entertainment brand in its own right. 
New mobile phone legislation that came into effect at the end of
February 2007 resulted in strong sales of hands free phone
solutions. Motorists caught using a mobile phone in their car now
risk a three points penalty and a £60 fine. Halfords range of Hands
Free Phone Kits covers all solutions from bluetooth earpieces
through to professionally, fully fitted hard wire solutions.
The satellite navigation market continued to grow strongly during
the last 12 months and Halfords continues to be the pre-eminent
retailer for these products, given our range strength, product
knowledge and unique “Set Up and Demo” proposition. 
We have enjoyed good relations with all key suppliers within this
sector and our improved forward planning of range activity and
marketing has enabled us to both grow sales and improve
profitability. Industry estimates vary, but a consensus would place
total car parc penetration for satellite navigation at approximately
10% of the 33 million cars on the road in the UK, indicating that a
combination of market potential and product innovation will
continue to drive growth in this category. 13562
“Our combination of market
leading range, knowledgeable
colleagues and unique fitting
capability, ensures that
Halfords has the right
technology solution to meet
customers’ requirements.”
■■ CAR ENHANCEMENT
IN-CAR TECHNOLOGY
As the UK’s number one retailer of in-car technology, Halfords is
committed to sourcing market-leading products at competitive
prices. This financial year saw continued range development and
included the successful introduction of private label electronics
under our Ripspeed brand, offering customers yet more choice. CHIEF EXECUTIVE’S REVIEW
continued
14/15
Halfords Group plc Annual Report and Accounts 2007
■■ LEISURE
Two-thirds of leisure sales are driven from our Cycling category.
Through Apollo, the UK’s best selling bike brand, and Carrera, the
UK’s leading premium cycle brand, our reputation for bikes and
cycle accessories continues to be enhanced by the evolution and
development of these private label products by our specialist
cycle team.
During the year we continued to serve more customers, with one
in three bikes bought in the UK being purchased from Halfords.
Further development of our Apollo brand, across a number of
consumer segments such as Kids, Junior, BMX, Adult and the
recently introduced Folding Bike ranges, has been recognised by
customers who have made Apollo the UK’s best selling bike brand.
The Carrera range was relaunched in September 2006, with bold
new designs and specifications designed around the needs of the
enthusiast cyclist with greater choice across Road, Hybrid,
Mountain and with more women specific variants. The Carrera
range now includes carbon fibre frame components for the first
time and a new All Terrain Mountain Bike — the Banshee X that
takes Carrera above the £600 price point for the first time. The
new Carrera Subway 1 was awarded 10/10 with a Best Buy Award
by Cycling Plus Magazine in March 2007.
All these cycle ranges are good examples of our ability to source
directly from the Far East with improved cost prices but also
improved quality and specification of individual models as we
have a direct influence on the final specification. This allows us to
provide quality bikes that deliver both competitive retail prices and
improved buying margins. 
Working in collaboration with GT, a recognised worldwide
premium cycle brand based in the US, a completely new and
exclusive range of bikes was designed in direct discussion with
Halfords and launched exclusively in our stores in October. The
response from customers and specialist press has been excellent,
with the new GT I Drive 5 XCR voted a test winner and receiving a
Gold Award in What MTB magazine.
For the new financial year we have also been developing further
specialist premium ranges in support of further sales opportunities
in this sector. Voodoo, an exclusive product range from the USA,
will be launched in Bikehut stand-alones and our better
performing Bikehut sub-shops.
Our most exciting development for 2007/08 will be the launch of
an exclusive range of premium cycles under the Boardman brand.
30 frame sizes across nine different models are the fruition of two
years’ development with Chris Boardman, Olympic gold medallist
and the best cyclist Britain has ever produced. Bikes will be made
to a very high specification but priced very competitively within
this sector of the market.
When new child seat legislation was
introduced in September 2006, Halfords
stock levels were increased to take full
advantage of increased customer demand.
Our marketing programme heightened
awareness of the impending legislation
change and our 2000 trained colleagues
enabled our customers to make an
informed product choice for their child.
CHILD SEAT LEGISLATION The continued roll-out of the supermezzanine format has helped
support additional product and brand choice within Bikehut at
Halfords. Bikehut sub-shops are now in place in all of our 376
Superstores across the country. Each includes a bike workshop
that adds credibility to the Bikehut sub-brand as a specialist bike
retailer. An increasing number of customers are recognising the
quality of bikes and service at Halfords, which is why more
consumers purchased a bike from Halfords than from all the
independent cycle retailers in the UK added together.
The extension of Bikehut from a retail brand to a product brand
through a range of premium cycle accessories has been well
received by customers who are looking for high quality
accessories at affordable prices. The Bikehut brand is our fastest
growing accessory brand with many products sourced directly
through Halfords Asia which ensures direct control over product
design and quality delivering competitive retail prices, strong
buying margins and exclusivity. Sales of Bikehut accessories are
now close to £10m, only two years after their launch.
On 18 September 2006, legislation was introduced which made it
a legal requirement to place all children under 12 years old or 
135 cm in height on a booster seat in a car, as well as wearing a
safety belt. Demand for such child seats increased considerably
immediately prior to and also after the legislative change. In
anticipation, we increased our stocks of these products and
reaped the sales benefit of the demand surge as a consequence.
Clearly such sales were beneficial but, placed in context, child
travel products still remain a relatively small proportion of our total
sales mix. 
Changes to our travel and camping ranges and managing the
price architecture within travel products generated encouraging
sales growth and improved profitability across these product
areas. Travel has now been developed as a clearly defined sub-
shop within the store in time for 2007 summer period and we
would anticipate the category growth to continue.
Within Camping considerable effort was made to source products
directly from the Far East that would appeal to the Halfords
customer. Family tent packs were introduced under the Halfords
brand name and sales exceeded our expectations. Equally, the
move to private label enhanced profitability. On the back of 2006
success, we anticipate further growth in this attractive market and
have further developed our range for 2007 with the introduction of
our Urban Escape premium camping range. 
■■ IMPROVING THE SUPPLY CHAIN
A further key element of the Halfords strategy has been to
increase the proportion of product, predominantly private label,
which is sourced directly from the Far East. This objective enables
our sourcing teams both in the UK and in Asia to exercise far
greater influence and control over the specification, quality and
functionality of products, often influencing manufacturers in their
own product development strategy, given the level of expertise
and market understanding our trading teams possess. 
A further material benefit is that by sourcing directly and avoiding
the requirement to source through agents we also benefit from
improved cost prices.
Price benefits are either reflected in our margin, or reinvested in
price or product specification to grow sales and market share or a
combination of both. Given the relatively low stock-turn of our
product range, some of these benefits agreed with suppliers
during the last financial year will continue to flow during the
forthcoming year as the new product becomes available.
In June 2004, our sales penetration of product directly sourced
from the Far East was 7%. We set an initial target of 20%
penetration within three years and have now achieved that target
ahead of schedule. We now source directly from eight different
countries in the Far East.
“Increasing numbers of
customers are recognising the
quality of bikes and service at
Halfords, which is why more
consumers purchased a bike
from us than from all the
independent cycle retailers in
the UK added together.” CHIEF EXECUTIVE’S REVIEW
continued
16/17
Halfords Group plc Annual Report and Accounts 2007
In recent months we have recruited individuals with sourcing
expertise in electronics and as a result we have been able to
introduce a series of own brand in-car technology products,
including Satellite Navigation, In-car DVD, and In-car CD players,
which also include functionality to play music downloaded onto
MP3 hardware (e.g. the iPod).
These new product developments (often market leading) within in-
car technology have supported the early achievement of our
penetration target and give us confidence that we can achieve
greater levels of sales penetration in the future. 
■■ ENVIRONMENTAL CONSIDERATION
We are naturally aware of the increasing need for all companies to
operate responsibly with regard to their impact on the
environment. During the year, we have put in place a series of
initiatives that will, over time, see further improvements and
economies generated from Halfords operations. These initiatives
include:
■ improved efficiency of our transport fleet
■ improvements in cardboard recycling
■ improved energy efficiency from stores
During the course of the year, through a combination of engine
selection on new tractor units, fuel consumption efficiency training
for drivers, and more efficient vehicle loading, we have seen an
increase in weight of product carried per kilometre by 6%. This
means that fewer vehicles were required to deliver our product
supply requirement to stores and also used less fuel doing so, as
fuel efficiency improved by 7%.
The cardboard recycling scheme was extended to all stores
during the year, such that over 95% of all cardboard waste
generated is recycled. We have also reduced the level of waste
consigned to landfill year on year by around 35%.
Within our stores, a three year plan has been agreed in
partnership with the Carbon Trust to reduce store emissions by a
further 8% over that period.
■■ MARKETING THE HALFORDS PROPOSITION
Halfords continued to develop its service offering and delivered
another strong year in its fitting and repair services. Almost 1.2
million customers experienced our professional “we fit” and “we
repair” services, an increase of 13% over 2006. Further research
conducted during the year confirmed the brand enhancement and
loyalty-driving qualities of these services, with 70% of customers
who had a product fitted by Halfords indicating a likelihood to visit
Halfords more often in the future. 
We continued to invest in store colleague training via the launch of
our training stores network with 700 colleagues now capable of
hardwire technology fitting and almost 2,000 trained to
professionally and safely install child seats. We also now have
over 1,500 colleagues trained to deliver our unique satellite
navigation “Set up and Demo” service. Sales of our “Bike Care”
bike maintenance and warranty product improved during the year,
helping to deliver a 25% increase in repair jobs.
We also rolled out nationally our unique “Scratch, Chip and Dent”
repair service, where customers can have minor bodywork marks
repaired at a fraction of the cost of bodyshops, with pleasing
levels of early customer uptake.
Halfords are continually improving measures to understand and reduce its carbon
footprint. As part of our ongoing initiatives within our transport fleet our fuel
efficiency has improved by 7% through a combination of engine selection on new
tractor units, fuel consumption efficiency training for drivers and more efficient
vehicle loading.
ENVIRONMENTAL CONSIDERATION Developing and increasing the level of uptake for our services will
remain a key focus for us in the coming year as we continue to
differentiate ourselves in the retail marketplace. 
Work was also undertaken during the year to align store team
rotas to better meet customer demand patterns for our fitting
services in order to deliver higher levels of “on demand” fitting for
products such as wiper blades, bulbs and batteries.
A monitoring system was implemented within store operations,
allowing us to interrogate current in-store rota construction. We
have re-engineered store rotas to optimise the percentage of
hours available at weekends to meet customer footfall. All stores
achieved their optimum rotas during the second quarter of the
year and these have been maintained since that time. 
The consumer trend towards greater levels of on-line usage seen
in the retail and broader consumer market was also felt in Halfords
with an extremely pleasing performance from Halfords.com.
Significant growth was achieved in website visitors, as well as on-
line sales and conversion. Improvements in our website navigation
also help customers more easily research on-line before buying
either on the site or in store. 
During the year, we implemented a new e-commerce fulfilment
system providing flexibility and scalability for future growth. With
the Internet continuing to influence a growing proportion of retail
sales, we will continue to develop our site to ensure we meet the
needs of Halfords’ customers. Developments are planned to
further improve our customers’ research and shopping experience
and we expect to introduce a “reserve on line, collect in store”
service in 2007 as part of our plans for multi-channel
development.
■■ OUTLOOK
The financial year ended 30 March 2007 is the third year since
Halfords became a listed company and in each of these years we
have delivered like-for-like sales growth. Active margin
management across all categories has arrested the margin dilution
effect of the previous year and we expect to maintain a broadly
neutral margin position in the forthcoming year, generating gross
margins in excess of 50%.
Our strategic focus remains to consolidate our position further
within our key markets, deliver additional growth from new
product areas, proactively source product directly from
manufacturers, wherever possible, and enhance our store portfolio
through opening new stores across each of our formats as well as
internationally. 
We have a disciplined reinvestment policy. Following on from the
success of our investments in the Republic of Ireland we are on
track to develop our international portfolio. Although at an early
stage, we also see clear potential for the success of new formats
such as Neighbourhood and our stand-alone bike retailing format
Bikehut.
The combination of our category sales and margin initiatives, our
space growth and the unique service advantage pursued through
the hard work of our colleagues continue to give us confidence in
Halfords’ future prospects and optimism for the delivery of further
growth in the forthcoming year.
Ian McLeod, Chief Executive
6 June 2007
Now currently established as our Number
One store, Halfords.com generated
encouraging increases in both unique
visitors and conversion year on year.  We
will continue to extend our multi-channel
offer, including improvements in product
imaging and a reserve on line and collect
in-store initiative planned for the new
financial year.  
HALFORDS ONLINE FINANCE DIRECTOR’S REPORT
18/19
Halfords Group plc Annual Report and Accounts 2007
■■ FINANCIAL RESULTS
Group sales for the 52 weeks ended 30 March 2007 were
£744.0m (2006: £681.7m), an increase of 9.1% on the comparable
period last year and representing a like-for-like sales increase of
6.0%. The absence of an Easter in the 52 weeks ended 31 March
2006 has meant that the underlying like-for-like sales performance
was 5.3%.
Gross profit at £376.1m (2006: £346.7m) is 50.6% as a
percentage of net sales and compares to last year’s figure of
50.9%. The 30 basis points (“bps”) dilution in gross profit per cent
represents a significant improvement on the 260 bps dilution
reported at the preliminary results last year. With reported margin
dilution in the first half of the year at 40 bps there was a second
half improvement, which saw year-on-year dilution of 20 bps. This
improvement reflects active margin management; the flow-through
of Far East sourcing benefits and continued sales growth in higher
margin categories. 
Operating expenses as a percentage of revenue are 20 bps higher
than last year at 38.0% (2006: 37.8%). Continued improvements
in store labour productivity and a slowdown in rental inflation has
been offset by the increase in administrative expenses driven by
the costs associated with the three store Czech Republic pilot,
increased costs of long and short-term incentives and legal costs
associated with the Group’s capital restructure. 
Net finance costs for the year excluding exceptional interest were
£10.0m (2006: £12.1m). Exceptional finance costs totalling £2.6m
were incurred as part of the debt re-financing exercise. The write-
off of previously capitalised loan fees arising from the repayment
of the Group’s term debt totalled £1.5m and the cost of closing
out of an interest rate swap was £1.1m.
Profit before tax was £80.9m compared with £77.0m in the prior
year, an increase of 5.1%, which rises to a year-on-year increase
of 8.4% when excluding the exceptional finance costs noted
above.
■■ LANDLORD CONTRIBUTIONS
Halfords actively manages its store portfolio to maximise value
creation through generating cash, making profits and increasing
the ongoing contribution from each store. Halfords’ high quality
portfolio, with 60% of its superstores on retail parks with A1
planning consents, together with its destination status provides
further potential from these activities and the Group anticipates a
similar level of contributions in the current financial year. Landlord
contributions during the year totalled £4.5m, compared to £6.9m
last year. 
■■ OPERATING LEASES
All of the Group’s stores are occupied under operating leases, the
majority of which are on standard lease terms, typically with a 15-
year term at inception. The Group has a total commitment under
non-cancellable operating leases of £810m (2006: £795m).
■■ TAXATION
The taxation charge on profit for the financial year was £23.5m
(2006: £23.4m) resulting in a full year effective tax rate of 29.0%
(2006: 30.4%). This tax rate has been driven by the treatment of
intercompany Loan Notes raised at the time of the Group’s
refinancing. It should be noted that although there is expected to
be a similar effective tax rate in 2007/08, the underlying tax rate is
31.6%, which reflects the non-deductibility of depreciation
charged on capital expenditure in respect of mezzanine floors and
other store infrastructure.
■■ EARNINGS PER SHARE
Basic earnings per share (EPS) were 25.8 pence (2006: 23.6
pence). An alternative EPS measure, excluding exceptional items,
reflects the Group’s underlying performance. Consequently, basic
EPS, excluding exceptional finance costs, were 26.6 pence (2006:
23.6 pence), a year-on-year increase of 12.7%. This level of EPS
growth reflects the increase in earnings driven by a strong trading
performance, a lower tax rate and the share buy-back programme.
■■ CAPITAL EXPENDITURE
Capital investment in the period totalled £23.9m (2006: £27.5m),
with a major focus on adding new selling space though expanding
the store portfolio. The Group opened 25 new stores, of which 
seven were relocations, growing the portfolio from 408 to 426
stores. This financial commitment underpins our strategy of
expanding the Superstore portfolio and rolling out new formats,
including the introduction of two stand-alone Bikehut stores in
Brighton and Putney. As noted in last year’s report the Group
continues to invest in the development of its infrastructure and
particularly new store systems. After a trial period these systems
are being rolled out nationally, successfully concluding the
Group’s five year programme to replace all of the core retail,
operational and financial systems. 
■■ CASH FLOW, NET DEBT, AND CAPITAL STRUCTURE
Having undertaken a comprehensive review of the Group’s capital
structure, the Board took the decision to undertake a debt re-
financing exercise, which was completed on 14 July 2006. The
debt facility now comprises a £180m five-year term non-
amortising loan, with a £120m revolving credit facility.
Total net debt at 30 March 2007 was £180.0m (2006: £173.7m)
and includes £12.4m (2006: £12.5m) in respect of the head office
finance lease.
The Group continues to generate strong net cash flows from
operations, which were £112.6m to 30 March 2007 (2006:
£100.9m) and included a working capital outflow of £4.5m (2006:
£11.5m). Stock levels remain well managed at £141.6m (2006:
£127.2m), an increase of 11.3%. This increase reflects stock
investment in new stores, together with the seasonal stock build
ahead of Easter, which fell in the second week of the new 
financial year.
Nick Wharton ■■ DIVIDEND AND SHARE BUY-BACK
The Board is recommending a final dividend of 9.50 pence per
share (2006: 8.75 pence per share), which, in addition to the
interim dividend of 4.35 pence per share, generates a total
dividend of 13.85 pence (2006: 12.75 pence).
Subject to shareholder approval at the Annual General Meeting,
the final dividend will be paid on 1 August 2007 to shareholders
on the register at the close of business on 29 June 2007.
At the preliminary results presentation on 8 June 2006, Halfords
announced a share buy-back programme to purchase, for
cancellation, up to £50m of share capital over a two year period.
The strongly cash generative nature of the business allows the
Group to maintain its investment in new stores and other strategic
opportunities, while improving capital efficiency and total
shareholder returns via this share buy-back. In the period from 
8 June 2006 to 30 March 2007, Halfords purchased 9.0m of its
own shares for an aggregate consideration of £30.0m, at an
average of 333.2 pence per share.
■■ PRINCIPAL RISKS AND UNCERTAINTIES
The Board considers risk assessment, identification of mitigating
actions and internal control to be fundamental to achieving
Halfords’ strategic corporate objectives. The Corporate
Governance report on pages 26 to 29 describes the systems and
processes through which the directors manage and mitigate risks.
The Board considers that the principal commercial and financial
risks to achieving its objects are those identified below. The Board
recognises that the nature and scope of risks can change and so
regularly reviews the risks faced by the Group as well as the
systems and processes to mitigate them.
(A) COMMERCIAL 
ECONOMIC AND MARKET CONDITIONS
The economy is a major influence on consumer spending. Trends
in employment, inflation, taxation, consumer debt levels and
interest rates impact consumer expenditure in discretionary areas.
Whilst many of the products that Halfords sell are non-
discretionary in their nature and predicting future trends is difficult,
Halfords reflects the latest independently sourced estimates in its
internal plans.
Furthermore, international expansion not only provides
opportunities for sustainable growth and returns but also
economic diversification.
COMPETITION
The retail industry is highly competitive. The Group competes with
a wide variety of retailers of varying sizes and faces competition
from UK retailers, as well as international operators. Failure to
compete with competitors on areas including price, product
range, quality and service could have an adverse effect on the
Group’s financial results.
We aim to have a broad appeal in price, range and store format in a
way that allows us to compete in different markets and to use service
as a point of differentiation in each market segment. We have an
established training infrastructure to ensure that our colleagues
receive ongoing product and service training. We track performance
against a broad range of measures that customers tell us are critical
to their shopping experience and monitor customer perceptions of
ourselves to ensure we can respond quickly if required.
DEPENDENCE ON KEY MANAGEMENT PERSONNEL
The success of Halfords’ business depends upon its senior
management closely supervising all aspects of its business, in
particular the operation of its stores and the design, procurement
and allocation of its merchandise. Retention of senior
management is especially important in Halfords’ business due to
the limited availability of experienced and talented retail
executives. 
If Halfords were to lose the services of members of its senior
management such as Ian McLeod, its Chief Executive Officer, 
Nick Wharton, its Finance Director, or Paul McClenaghan, its
Trading Director, and were unable to employ a suitable
replacement in a timely manner, its business could be 
adversely affected. 
Our Remuneration Policy outlined on page 30 details the
strategies in place to ensure that high calibre executives are
attracted and retained. The Group also operates a “Talent
Management” process to help individuals achieve their full
potential within Halfords and to ensure that appropriate
succession plans are in place to meet the future needs of the
business.
REPUTATIONAL RISK
The Halfords name is a key asset of the business and as the
largest retailer in its markets, expectations of the Group are high.
Failure to protect the Group’s reputation and brand could lead to a
loss of trust and confidence. This could result in a decline in the
customer base and affect the ability to recruit and retain good
people.
The Group has a Quality Assurance team and legal and regulatory
control processes both in-house and externally to advise and take
action on existing and emerging risk management issues. We
continually monitor loyalty to the Halfords brand through
independent surveys and seek through activities such as Charity
of the Year, to contribute to society more widely. Our various
Codes of Practice regulate our behaviour in our dealings with all
stakeholders including customers, suppliers and colleagues.  FINANCE DIRECTOR’S REPORT
continued
20/21
Halfords Group plc Annual Report and Accounts 2007
RESPONSIVENESS TO CHANGING CONSUMER
PREFERENCES
Some of the products that Halfords sells, particularly in the car
enhancement category, are subject to rapidly changing consumer
preferences. Halfords has recruited experienced, knowledgeable
colleagues who can identify and interpret trends and
consequently respond in a timely manner to changes in consumer
preferences. Some of the products Halfords sells, such as
children’s cycles, face competition from alternative products (such
as games consoles) and our colleagues monitor developments in
these areas. 
INFORMATION TECHNOLOGY (IT) SYSTEMS AND
INFRASTRUCTURE
Halfords is reliant on efficient IT systems throughout its business
operations. Recognising the key role that IT plays in improving
operating effectiveness and improving the customer experience 
in our stores, we continue to invest in upgrading our IT
infrastructure. Any significant failure within our network during 
any systems change would potentially compromise our
operational capability for a period of time.
Extensive controls are in place to maintain the integrity of our
systems infrastructure and to ensure that any systems changes
are implemented in a managed and controlled manner. Halford’s
core commercial and retail systems are sourced from leading
global providers and continuity plans are in place for all core
systems.
RELIANCE ON FOREIGN MANUFACTURERS
Halfords sources a significant proportion of the merchandise it
sells in its stores from outside of the UK. Consequently, the Group
is subject to the risks associated with international trade
(particularly those which are common in the import of goods from
developing countries), including, but not limited to the imposition
of taxes or other charges on imports and exposure to different
legal standards and the burden of complying with a variety of
foreign laws and changing foreign government policies. 
Extensive research is conducted before the Group procures
product from any new country or supplier. The Group’s strong
management team in the Far East has been recruited from local
nationals who understand the local culture, market regulations
and risks.
(B) FINANCIAL 
TREASURY POLICY
The Group’s Treasury Policy is structured to ensure that adequate
financial resources are available for the development of its
business whilst managing its currency, interest rate and
counterparty credit risks. The Group’s Treasury strategy, policy
and controls are approved by the Board. 
The main elements of Treasury activity and associated risk are
outlined below:
FUNDING
The Treasury function arranges sufficient secure financial
resources to enable the Group to meet its medium-term business
objectives, whilst arranging facility maturities appropriate to its
projected needs.
The Group successfully renegotiated a syndicated five-year term
facility during the financial year and has committed bank facilities
comprising a non-amortising five-year term loan of £180m and a
revolving credit facility of £120m, which, together with cash
surpluses, provide adequate funding for the Group’s operations.
CURRENCY
The Group’s main currency translation exposure is limited to
movements in exchange rates to the extent that they affect
balances held on its currency bank accounts. Foreign currency
bank balances are controlled by the Treasury function and are
actively managed to a level that minimises currency translation
exposures. The Group’s main currency exposure is its transaction
exposure through movements in exchange rates on its purchases
overseas that are not denominated in sterling. These are mainly
imports from Asia denominated in US dollars and imports from
Europe denominated in euros.
The Treasury Policy sets out a framework through which the
majority of the Group’s forecast foreign currency transactions 
are hedged.
INTEREST
The Group’s bank term debt carries a variable rate of interest
linked to prevailing LIBOR rates. In conjunction with the new
syndicated loan facility and, in order to mitigate the risk of a rise in
UK interest rates, the Group has entered into a single rate swap
until 13 July 2011. As at 30 March 2007, 45% (2006: 83%) of net
bank debt position carried a fixed rate of interest and the
weighted average pre-tax cost of debt was 5.6% (2006: 6.2%).
The position is regularly reviewed and the Group’s policy of
hedging at least 40% of the following year’s forecast interest rate
exposure is satisfied for the period ending 30 March 2008. As at
30 March 2007, £86.0m (2006: £114.9m) of net bank debt was at
a floating rate.
COUNTERPARTY CREDIT RISK
The Group actively manages its relationships with a panel of high
quality financial institutions. Credit risk is controlled by the
Treasury function setting counterparty credit limits by reference to
published rating agency credit ratings, ensuring that such
counterparties hold at least an A credit rating. The Treasury Policy
recognises that an exposure to a counterparty arises in relation to
investments, derivatives and financial instruments.
Nick Wharton, Finance Director
6 June 2007 CORPORATE SOCIAL RESPONSIBILITY
Halfords’ corporate social responsibility programme is designed to
align the Group’s operations with the important corporate social
responsibility issues for our business and to facilitate appropriate
management approaches. 
Our aim is to continually improve our management of those social,
environmental and economic issues within our control or influence
throughout the business and our supply network. 
A summary of our policies and developments in these areas over
the past year is given below. Our full Corporate Social
Responsibility Report 2007 can be found on the Company’s
corporate website, www.halfordscompany.com. 
We group our areas of engagement into four broad categories:
how we source our products and market them, how we deal with
our colleagues, how we affect the environment and how we
interact with the communities in which we operate. Our principles
within these areas are given below. 
In selling our products and services we aim to meet or exceed the
requirements of legislation, regulation, industry standards,
international conventions and codes of practice. We oppose the
exploitation of children and young people, and the exploitation of
workers generally, and we support fair and reasonable rewards
and conditions for workers. To this end, we conduct factory,
warehouse and tied accommodation inspections and audits to
ensure that our standards are being implemented. Further, the
health and safety of workers employed in our supply chain is a key
concern for us. We require all activities to be carried out under
conditions that have proper and adequate regard for the health
and safety of those involved.
In the workplace, engaging with our colleagues is a key objective
for Halfords. One of our greatest achievements regarding this
engagement was our ability to reward our people following the
flotation of the Company in 2004 and let them share in our future
success as a listed company. To do this we successfully launched
a company share option scheme that invited employees to accept
a grant of options. The most innovative aspect of this scheme was
the decision to include all of our people, subject to a service
requirement, irrespective of their position within the business. We
are particularly proud of this achievement, as similar schemes are
usually designed for the executive or senior management
population. This grant of options becomes eligible for exercise in
June 2007. We also encourage wider share ownership within the
business through a sharesave scheme, which is available to
colleagues, subject to eligibility criteria.
Colleague engagement and support are vitally important to the
Group and several initiatives are in place to achieve this, e.g. an
intranet site has been set up enable colleagues to post comments
on any business matter and a Group-wide colleague engagement
survey was launched towards the end of the year. Specific
support sessions have been created for major business changes,
such as the introduction of new systems. In addition, training and
development programmes are in place throughout the business to
maximise people’s skills and advancement.
With environmental issues our commitment is to understand and
improve the performance and management of our environmental
impact throughout the Halfords supply chain. We aim to achieve a
high standard of responsible care for people and the environment,
whilst maximising business efficiency and growth. 
As a part of our community engagement the Group has chosen
The Meningitis Trust as our Charity of the Year. This involves all of
our employees in the UK and the Republic of Ireland in fund-
raising initiatives to support the Trust. On average, one person in
the UK dies every day from meningitis and it kills more children
under five than any other infectious disease. The Halfords
partnership will focus on raising awareness amongst our staff and
customers and raising money to support the charity’s many
campaigns. BOARD OF DIRECTORS
22/23
Halfords Group plc Annual Report and Accounts 2007
Richard Pym
Non-executive Chairman
Richard joined the Board as the Senior Independent Director in
May 2004 and was appointed Chairman on 1 April 2006. He is
Group Chief Executive of Alliance & Leicester plc. He was a non-
executive director of Selfridges plc and has held various roles at
Thomson McLintock & Co, British Gas plc, BAT Industries plc and
The Burton Group plc.
Ian McLeod
Chief Executive
Ian joined Halfords in September 2003 and was appointed to the
Board in May 2004. He became Chief Executive in April 2005.
Previously, he was Chief Executive of Celtic plc for two years.
Prior to this Ian was on the Executive Board of Wal-Mart, Germany
and held several positions within Asda over the course of 20 years
and was Director of Asda Stores Limited between 1997 and 2001.
Ian is a non-executive director of Fulham Football Club Ltd.
Nick Wharton
Finance Director
Nick was appointed as Finance Director in February 2007. He
joined Halfords Limited as Finance and Planning Director in March
2002, becoming Business Development Director in 2003. Nick has
also held Board responsibility at Halfords Limited for Information
Systems and Human Resources. Prior to this Nick held senior
finance positions with Boots Opticians, Boots Healthcare
International, Do-it-All Limited and also within Cadbury
Schweppes. He is a qualified Chartered Accountant.
Paul McClenaghan
Director of Trading
Paul was appointed as Director of Trading on 31 March 2007. He
joined Halfords Limited as Trading Director in May 2005. Prior to
this Paul worked for the Dixons Group, most recently as Trading
Director for its Vision and Audio division. He also held the
positions of Buying Director for Brown Goods and Commercial
Director for Dixons Asia. Keith Harris
Non-executive Director
Keith was appointed a non-executive director in May 2004. He
has been Executive Chairman of Seymour Pierce Limited since its
acquisition from Investment Management Holdings Plc. Prior to
this Keith was Chairman of the Football League and Chief
Executive of HSBC Investment Bank plc. Keith is currently on the
boards of Wembley National Stadium Limited, Benfield plc and
CLS Holdings plc.
Bill Ronald
Non-executive Director
Bill joined the Board as a non-executive director in May 2004. He
is Chairman of Bezier Limited and Chairman of Europackaging
Limited. He is also a non-executive director of Alfesca. Previously
he was Chief Executive of Uniq plc for three years, prior to which
Bill spent 23 years in a variety of roles within the Mars
Corporation. His final positions there were Managing Director 
of the UK confectionery operation and Vice-President of
Masterfoods Europe.
Nigel Wilson
Non-executive Director
Nigel joined the Board as a non-executive director in May 2004
and was appointed Senior Independent Director on 1 April 2006.
Currently he is Chief Financial Officer of United Business Media
plc. Prior to that he was Group Finance Director of Viridian Group
plc from 1996 to 2000, and became Managing Director of Viridian
Capital in 2000. Previous appointments include Group Finance
Director at Waste Management International, Chief Executive,
Corporate G.P .A., Head of Corporate Finance and Group
Commercial Director of Dixons Group plc, Managing Director of
Stanhope Properties plc and a consultant at McKinsey & Co. Nigel
has a PhD from the Massachusetts Institute of Technology. Directors’ Report
24/25
Halfords Group plc Annual Report and Accounts 2007
The directors present their report and the consolidated financial
statements of Halfords Group plc (the “Company”) together with
its subsidiary undertakings (the “Group”) for the financial year
ended 30 March 2007.
■■ PRINCIPAL ACTIVITIES
The principal activity of the Group is the retailing of auto, leisure
and cycling products. The principal activity of the Company is that
of a holding company.
■■ BUSINESS REVIEW
The Chief Executive’s Review and the Finance Director’s Report
on pages 6 to 20 review the Group’s business and performance
during the year and contain or cross-reference the information
required by section 234ZZB of the Companies Act 1985, such
information being incorporated in this report by reference.
■■ RESULTS AND DIVIDENDS
The Group’s results for the year are set out in the Consolidated
Income Statement on page 38.
The profit before tax amounted to £80.9m (2006: £77.0m) and the
profit after tax amounted to £57.4m (2006: £53.6m).
The directors propose that a final dividend of 9.5p per ordinary
share be paid on 1 August 2007 to shareholders whose names are
on the register of members at the close of business on 29 June
2007. This payment, together with the interim dividend of 4.35p
per ordinary share paid on 8 January 2007, makes a total for the
year of 13.85p per ordinary share. The total dividend payable to
shareholders for the year is estimated to be £30.5m. Lloyds TSB
Offshore Trust Limited, trustee of the Halfords Employee Share
Trust, has waived its entitlement to dividends.
■■ DIRECTORS
Profiles of the current directors are given on page 22.
The following persons were directors during the 52 weeks to 
30 March 2007: 
Richard Pym
Ian McLeod 
Nick Carter (resigned 2 February 2007)
Nick Wharton (appointed 3 February 2007)
Nigel Wilson 
Keith Harris
Bill Ronald 
Paul McClenaghan was appointed on 31 March 2007.
In accordance with the Company’s Articles of Association, Ian
McLeod and Bill Ronald are retiring by rotation at the forthcoming
Annual General Meeting and, being eligible, will offer themselves
for re-election at that meeting. Having been appointed as
directors by the Board since the last Annual General Meeting, 
Nick Wharton and Paul McClenaghan will offer themselves for
reappointment at the Annual General Meeting. 
■■ DIRECTORS’ INTERESTS
The directors’ interests in shares and options over shares in the
Company are shown in the Directors’ Remuneration Report on
pages 30 to 35. 
No director had a material interest at any time during the year in
any contract with the Company or any of its subsidiary
undertakings, other than his service contract.
During the year the Company maintained liability insurance for its
directors and officers. The directors of the Company, and the
directors of each of the Company’s subsidiaries, have the benefit
of an indemnity provision in the Company’s Articles of
Association. The indemnity provision, which is a qualifying third-
party indemnity provision as defined by section 309A of the
Companies Act 1985, was in force throughout the year and is
currently in force.
■■ CORPORATE SOCIAL RESPONSIBILITY
A summary of the Group’s Corporate Social Responsibility Report
is set out on page 21. The Chief Executive’s Review includes a
report on the Group’s performance against relevant environmental
criteria. 
■■ CHARITABLE DONATIONS AND POLITICAL
CONTRIBUTIONS
During the year the Group contributed £40,000 (2006: £20,000) to
charities in the UK, comprising donations to Ben, a charity
supporting individuals and families linked to the motor industry
and associated trades, and a donation to help persons suffering
from the failure of the Farepak Christmas hamper scheme. The
Group’s policy is not to make any donations for political purposes.
However, the Companies Act 1985 defines the term “donations”
very widely and, as a result, certain expenses legitimately incurred
as part of the process of talking to Government at all levels and
making the Group’s position known, are now reportable. Although
during the year no such expenditure or political donations were
made, resolutions were passed at the 2005 Annual General
Meeting that provided for limited authority for such expenditure,
such authority remaining valid until the conclusion of the Annual
General Meeting to be held in 2008.
■■ COLLEAGUES
The Board seeks to instil high standards of customer care and
service in the Group and the commitment of every colleague to
this business requirement is considered to be critical. The Group
has established a framework of communication for colleagues
concerning business performance and company benefits. Group-
wide training reinforces the Group’s commitment to colleague
involvement and development.
The Group is committed to the principle of equal opportunity in
employment and to ensuring that no applicant or colleague
receives less favourable treatment on the grounds of gender,
marital status, race, ethnic origin, religion, disability, sexuality, age,
or is disadvantaged by conditions or requirements which cannot
be shown to be justified. The Group applies employment policies
which are fair and equitable and which seek to promote entry into
and progression within the Group. Appointments are determined
solely by application of job criteria, personal ability and
competency. The Group gives full and fair consideration to applications for
employment made by disabled persons, having regard to their
particular aptitudes and abilities, wherever suitable opportunities
exist, and training and career development support are provided,
where appropriate. Should a colleague become disabled when
working for the Group, efforts are made to continue their
employment and retraining is provided, if necessary.
A “whistle-blowing” policy and procedure is in place and has been
notified to staff. The policy enables them to report any concerns
on matters affecting the Group or their employment, without fear
of recrimination, and reduces the risk of things going wrong or of
malpractice taking place and remaining unreported. In addition,
the Group takes a zero-tolerance approach to matters of
discrimination, harassment and bullying in all aspects of its
business operations, whether they relate to sex, race, national
origin, disability, age, religion or sexual orientation, and policies
and procedures are also in place for reporting and dealing with
these matters.
Owning shares in the Company is an important way of
strengthening colleagues’ involvement in the development of the
Group’s business and bringing together their and shareholders’
interests. The Company therefore encourages the Group’s
colleagues to participate in its Sharesave Scheme.
The Group’s pension arrangements for the UK-based colleagues
of the Group are summarised in note 22 on page 62.
■■ SUPPLIER PAYMENT POLICY
The Group does not follow any formal code or standard on
payment practice, but agrees terms and conditions for its
business transactions when orders for goods and services are
placed, and includes the relevant terms in contracts, where
appropriate. These arrangements are adhered to when making
payments, subject to the terms and conditions being met by
suppliers. The number of trade creditor days outstanding at the
period end for the Group was 38 days (2006: 49 days). The
Company is a holding company and had no trade creditors at the
end of the financial year.
■■ MAJOR SHAREHOLDERS
At 6 June 2007, the Company’s share register of substantial
shareholdings showed the following interests in 3 per cent or more
of the Company’s issued ordinary shares:
Number of  % of 
Holder shares issued shares
Newton Investment Management 19,262,626 8.79
Resolution Asset Management 14,856,360 6.78
M&G Investment Management 13,228,678 6.04
Autobacs Seven Co. Ltd 11,400,000 5.20
Jupiter Asset Management 10,707,758 4.89
F&C Asset Management 10,594,977 4.84
Capital Group Companies 9,300,000 4.24
Legal & General Investment Management 8,886,850 4.06
Rathbones 8,858,453 4.04
Aberforth Partners 8,122,213 3.71
New Star Asset Management 7,891,274 3.60
Artemis Investment Management 7,724,171 3.53
■■ AUTHORITY TO PURCHASE SHARES
On 8 June 2006 the Company announced a share buy-back
programme, to be effected over the following two years, of up to
£50m. At the Annual General Meeting on 2 August 2006
shareholders approved a special resolution authorising the
Company to purchase a maximum of 22,736,499 shares,
representing 10% of the Company’s issued share capital at
16 June 2006, such authority expiring at the conclusion of the
AGM to be held in 2007. Since the share buy-back programme
began, 9,003,956 shares of 1p each, representing a nominal value
of £90,040, have been purchased and cancelled, representing
4.1% of the Company’s issued share capital as at 30 March 2007.
The aggregate consideration (including stamp duty) paid for the
shares was £29,881,121.
■■ DISCLOSURE OF INFORMATION TO AUDITORS
Each of the persons who are directors at the date of approval of
this report state that, so far as he is aware, there is no relevant
audit information of which the Company’s auditors are unaware,
and that he has taken all the steps that he ought to have taken as
a director in order to make himself aware of any relevant audit
information and to establish that the Company’s auditors are
aware of that information.
■■ AUDITORS
PricewaterhouseCoopers LLP has indicated its willingness to
accept reappointment as the external auditor of the Company. A
resolution proposing its reappointment is contained in the Notice
of the Annual General Meeting and will be put to shareholders at
the meeting.
■■ GOING CONCERN
The directors confirm that they are satisfied that the Group has
adequate resources to continue in business for the foreseeable
future. For this reason, they continue to adopt the going concern
basis in preparing the accounts. 
■■ ANNUAL GENERAL MEETING
The Annual General Meeting will be held at the Alveston Manor
Hotel, Clopton Bridge, Stratford-upon-Avon, Warwickshire,
CV37 7HP , on Wednesday 25 July 2007 at 12.30 pm. The notice of
the Annual General Meeting and explanatory notes regarding the
special business to be put to the meeting are set out in a separate
circular to shareholders accompanying the Annual Report and
Accounts.
By order of the Board
Philip Parker, Company Secretary
6 June 2007 Corporate Governance
26/27
Halfords Group plc Annual Report and Accounts 2007
■■ CORPORATE GOVERNANCE
The Board is responsible for the Group’s system of corporate
governance. The Board is committed to high standards of
corporate governance and its policy is to manage the affairs of the
Company in accordance with the principles of good governance
and the provisions set out in Section 1 of the Combined Code on
Corporate Governance, issued by the Financial Reporting Council
in July 2003 (the “Combined Code”). The following statement
describes how the Company has applied the main and supporting
principles set out in the Combined Code. 
■■ STATEMENT OF COMPLIANCE WITH THE 
COMBINED CODE
The directors consider that the Company has applied the
principles and complied with the provisions of Section 1 of the
Combined Code for the year ended 30 March 2007, with the
exception of provision B.2.1, as the Chairman sits on the
Remuneration Committee.
■■ THE DIRECTORS
The following persons were directors of the Company during the
year ended 30 March 2007: 
Richard Pym (Chairman)
Ian McLeod (Chief Executive)
Nick Carter (Finance Director to 2 February 2007)
Nick Wharton (Finance Director from 3 February 2007)
Nigel Wilson (Senior Independent Director and 
non-executive director)
Keith Harris (non-executive director)
Bill Ronald (non-executive director)
Paul McClenaghan was appointed Director of Trading from 
31 March 2007.
■■ BOARD STRUCTURE
The Board is currently composed of seven members, consisting of
three executive directors, a non-executive chairman and three
non-executive directors. The three non-executive directors are
considered by the Board to be independent. Accordingly, no
individual or group of individuals dominates the Board’s decision-
making and the requirement of the Combined Code that at least
half of the Board (excluding the chairman) should comprise
independent non-executive directors is satisfied.
Biographical details of the directors are given on pages 22 and 23.
The directors have wide experience and expertise and the Board
believes that all of the directors devote sufficient time and
attention as is necessary in order to perform their duties.
■■ ROLE AND WORKINGS OF THE BOARD
The Board’s role is to determine the long-term direction and
strategy of the Group, create value for shareholders, monitor the
achievement of business objectives and ensure that good
corporate governance is practised and that the Group meets its
other responsibilities to its shareholders, customers and other
stakeholders. The Board is also responsible for ensuring that
appropriate processes are in place in respect of succession
planning for appointments to the Board and to senior
management positions.
The Board has a formal schedule of reserved powers, which it
retains for Board decision-making on a range of key issues,
including the formulation of strategy, financial reporting and
controls, corporate governance matters, and treasury and risk
management. A procedure has been adopted for directors to
obtain independent professional advice where appropriate, at the
cost of the Company, and all directors have unrestricted access to
the Company Secretary, who is an employee of the Company. In
relation to non-reserved matters, the Board is assisted by a
number of committees with delegated authority. The make-up and
role of each of these committees is described below.
The Board meets on a regular basis. During the financial year
ended 30 March 2007, the Board met formally ten times. The
Board is supplied in a timely manner with information appropriate
to enable it to discharge its duties. Appropriate management
reports and financial information are provided to the Board on a
monthly basis and in advance of each Board meeting. These
normally include monthly management reports, accounts, reports
on current trading and papers on matters in respect of which the
Board makes decisions or is invited to give its approval. Specific
presentations on business and strategic issues are made regularly.
Minutes of committee meetings are circulated to all Board
members, unless a conflict of interest arises. 
The Chairman is primarily responsible for the workings of the
Board and is not involved in day-to-day operational issues. Save
for matters reserved for decision by the Board, the Chief
Executive, with the support of the Finance and Trading Directors,
is responsible for the running of the Group’s business, carrying out
the agreed strategy adopted by the Board and implementing
specific Board decisions relating to the operation of the Group.
Nigel Wilson was the Senior Independent Director throughout the
period under review. The Senior Independent Director is available
to meet shareholders upon request if they have concerns which
contact through the normal channels of the Chairman or the
executive directors has failed to resolve, or for which such contact
is inappropriate.
The Company is supportive of executive directors who wish to
take one non-executive directorship with a company outside the
Group, as exposure to such duties can broaden experience and
knowledge, which will be to the benefit of the Company. Executive
directors may retain any fees they receive. Ian McLeod is currently
a non-executive director of Fulham Football Club. Fees retained in
the year were £25,000 (2006: £25,000).
■■ APPOINTMENT OF DIRECTORS
The Board will appoint any new directors having first considered
recommendations made to it by the Nomination Committee.
Following such appointment, the director will be proposed for
reappointment at the next Annual General Meeting of the
Company. Under the Company’s Articles of Association there is
also a process of retirement by rotation, which ensures that
approximately one-third of all directors are required to retire and
seek re-election at each Annual General Meeting and that no
director serves for more than three years without being proposed
for re-election at an Annual General Meeting. Ian McLeod and Bill
Ronald will retire and offer themselves for re-election at this year’s
Annual General Meeting. Having been appointed as directors by
the Board since the last Annual General Meeting, Nick Wharton
and Paul McClenaghan will offer themselves for reappointment at
this year’s Annual General Meeting.
Non-executive directors are appointed for specified terms
(normally three years), subject to reappointment under the Company’s Articles of Association and subject to the Companies
Act provisions relating to the removal of a director. The Chairman
will confirm to shareholders when proposing an appointment or
reappointment that, following formal performance evaluation, the
individual’s performance continues to be effective and they
demonstrate commitment to the role. 
The Board has formally adopted an induction programme for new
directors, which will be tailored to each new director who joins the
Board and includes briefings regarding the activities of the Group
and visits to stores. Documentation and training on their duties as
directors are also available to all directors. In addition, directors
are also informed regularly on relevant material changes to laws
and regulations affecting the Group’s business. All directors have
access to the advice and services of the Company Secretary, who
is also responsible for advising the Board on all governance
matters.
■■ BOARD COMMITTEES
The Board has established Nomination, Remuneration and Audit
Committees, with formally delegated duties and responsibilities
and written terms of reference. These terms of reference can be
accessed on the Company’s website, www.halfordscompany.com.
The Company Secretary acts as secretary to all three Committees.
Only the members of each Committee are entitled to attend its
meetings, although other directors, professional advisers and
members of the senior management team attend when invited to
do so. The Audit Committee will invite the external auditor to
certain of its meetings. In the cases of the Nomination and
Remuneration Committees, no member is present when business
pertinent to them is under discussion. A Treasury Committee,
composed of senior members of the finance and treasury teams
and chaired by the Finance Director, has been established to
manage the day-to-day treasury needs of the Group. When the
need arises, separate ad hoc committees may be set up by the
Board to consider specific issues.
AUDIT COMMITTEE
For the year ended 30 March 2007, the Audit Committee
comprised Nigel Wilson, Keith Harris and Bill Ronald, all of whom
are independent non-executive directors. The Committee
chairman is Nigel Wilson, who, being also Chief Financial Officer
of United Business Media plc, is considered by the Board to have
recent and relevant financial experience. Each of the other
independent non-executive directors on the Committee has,
through their other business activities, significant experience in
financial matters. 
The Audit Committee meets at least three times a year, according
to the requirements of the Company’s financial calendar. The
meetings of the Audit Committee also provide the opportunity for
the independent non-executive directors to meet without the
executive directors present and also the opportunity to raise any
issues of concern with the Company’s external auditor.
In addition to ensuring the integrity of the Group’s half-year and
full-year financial statements before publication, the Audit
Committee has responsibility for monitoring a number of other
areas of activity, including:
■ the effectiveness of the Group’s internal controls and the
Group’s risk management policies and systems
■ the integrity, performance and independence of the Group’s
relationship with the external auditor
■ reviewing the nature and extent of non-audit services by the
external auditor, with particular scrutiny as to whether the
provision of such services may affect the objectivity and
independence of the external auditor 
■ the Committee requires any proposal for expenditure of over
£25,000 as non-audit services to be referred to it for scrutiny
and approval
■ making recommendations to the Board on the appointment of
auditors and the audit fee
■ keeping under review the scope and results of the audit and
its cost effectiveness
At the end of the year the Audit Committee required the external
auditor to confirm the safeguards it has in place to ensure that its
objectivity and independence is not impaired with respect to its
provision of non-audit services to the Company.
At least once a year the Audit Committee meets with the external
auditor without any executive directors present.
NOMINATION COMMITTEE
For the year ended 30 March 2007 the Nomination Committee
comprised Richard Pym (Chairman), Keith Harris, Bill Ronald,
Nigel Wilson and Ian McLeod. Keith Harris, Nigel Wilson and Bill
Ronald are independent non-executive directors. 
The Nomination Committee is required to meet at least twice each
year. During the period under review it met to consider succession
planning for the Board and senior management generally, and to
propose the appointment of the new executive directors. 
The responsibilities of the Nomination Committee include:
■ nominating candidates (both executive and non-executive) for
appointment to the Board, to fill vacancies or appoint
additional persons to the Board 
■ monitoring the size, structure, balance and composition of the
Board
■ evaluating the balance of skills, knowledge and experience of
the Board’s members
■ making recommendations in respect of the membership of the
Nomination, Audit and Remuneration Committees
■ making recommendations in respect of the reappointment (or
not) of non-executive directors and of the continuance in
service (or not) of executive directors.
In discharging its duties, the Nomination Committee considers the
challenges and opportunities facing the Group and the skills and
expertise required for the future. In relation to any new
appointments, the Committee evaluates the balance of skills,
knowledge and experience on the Board and, in the light of this
evaluation, prepares a description of the role and capabilities
required for a particular appointment. 
REMUNERATION COMMITTEE
For the year ended 30 March 2007, the Remuneration Committee
comprised Keith Harris (Chairman), Richard Pym, Nigel Wilson
and Bill Ronald. Keith Harris, Nigel Wilson and Bill Ronald are all
independent non-executive directors. The Board has agreed that
Richard Pym will remain a member of the Remuneration
Committee, contrary to provision B.2.1 of the Combined Code, in
anticipation of the 2006 Combined Code which is effective in the
year ending 29 March 2008 and which allows company chairmen
to sit on remuneration committees. Corporate Governance
continued
28/29
Halfords Group plc Annual Report and Accounts 2007
The Remuneration Committee is required to meet at least twice
each year.
The Remuneration Committee’s responsibilities include:
■ making recommendations to the Board on the Company’s
framework of executive remuneration and its cost
■ reviewing and determining on behalf of the Board, the
remuneration and incentive packages of the Company’s
executive directors and certain senior executives of the Group
to ensure that they are fairly rewarded for their individual
contributions to the Group’s overall performance
■ determining the basis on which the employment of the
Company’s executive directors and certain senior executives
of the Group is terminated 
■ operating and administering the Company’s share option
schemes and employee benefit trust.
The Board’s remuneration policy is described in detail in the
Directors’ Remuneration Report on pages 30 to 35.
■■ EVALUATION OF THE BOARD AND ITS COMMITTEES
The Board has established a formal process for the annual
evaluation of the performance of the Board, its principal
committees and individual directors. Questionnaires are drawn up,
which provide the framework for the evaluation process. Each
member of the Board or appropriate Committee submits replies to
the questionnaires, which are then collated. Following a review of
these responses by the Board or by the appropriate Committee
any appropriate action will be taken to ensure that the
performance of the Board as a whole, its principal committees
and individual directors is such that each can perform at the
optimum level for the benefit of the Company. The Senior
Independent Director and the other independent non-executive
directors conduct the annual performance evaluation of the
Chairman.
■■ ATTENDANCE AT BOARD AND COMMITTEE MEETINGS
The number of meetings of the Board and of each of the Audit,
Remuneration and Nomination Committees held during the year
ended 30 March 2007, together with a record of each member’s
attendance, is set out below. Any director not able to attend a
meeting is supplied with all papers in advance of the meeting for
their review and comment.
Number of meetings attended
Remu- Nomi-
Audit neration nation
Board Committee Committee Committee
Richard Pym 10 n/a 2 4
Ian McLeod 10 n/a n/a 4
Nick Carter 
(resigned 02.03.07) 8 n/a n/a n/a
Nick Wharton 
(appointed 03.02.07) 2 n/a n/a n/a
Nigel Wilson 10324
Bill Ronald 10323
Keith Harris 9 3 2 3
Total meetings in year 10324
Note: n/a denotes that a director was not a member of the
relevant Committee. 
In addition to the scheduled meetings numbered above, the Board
held an additional meeting to review corporate strategy, visited
stores to review operational and systems progress and attended
the annual store managers conference. The Audit Committee also
held additional meetings to review the various trading statements. 
■■ ACCOUNTABILITY, RISK MANAGEMENT AND
INTERNAL CONTROL
The Board has overall responsibility for the system of internal
control and for reviewing its effectiveness throughout the Group.
The assessment of effectiveness has been carried out this year.
The system of internal control is designed to manage, rather than
eliminate, the risk of failing to achieve business objectives and can
provide only reasonable and not absolute assurance against
material misstatement or loss. The Audit Committee, on behalf of
the Board, reviews the effectiveness of the Group’s systems of
internal control and risk management. 
The Board considers risk assessment and control to be
fundamental to achieving its corporate objectives within an
acceptable risk/reward profile and there is an ongoing process for
identifying and evaluating the significant risks faced by the Group
and the effectiveness of related controls. The key elements of this
process are:
■ a comprehensive system of monthly reporting from key
executives, identifying performance against budget, analysis
of variances, major business issues, key performance
indicators and regular forecasting
■ well-defined policies governing appraisal and approval of
capital expenditure and treasury operations
■ reviews of key business risks and of management’s controls
and plans to mitigate these risks
■ an annual corporate governance confirmation made to the
Board by all directors on the effectiveness of the identification
of major risks and of the monitoring of internal controls within
their areas of responsibility.  As part of the process for identifying, evaluating and managing the
key business risks faced by the Group the Board has established
a Risk Management Group to oversee the implementation of the
risk management framework, co-ordinate risk management
activities throughout the business and to report to the Board and
Audit Committee on risk issues. The Risk Management Group is
chaired by the Company Secretary and includes senior managers
from Finance, Business Systems, Supply Chain/Logistics, Store
Assurance and Internal Audit functions. 
The external auditor reports directly to the Audit Committee.
Deloitte & Touche LLP , as independent adviser, is formally
engaged to provide internal audit services, reporting to the Board,
via the Audit Committee. These reports evaluate the adequacy
and effectiveness of the Company’s internal controls and
recommend improvements, based on a systematic risk
assessment of the business.
■■ RELATIONSHIP WITH SHAREHOLDERS
The Board recognises the importance of establishing and
maintaining good relationships with all of the Company’s
shareholders. The Chief Executive, Finance Director and the
Chairman meet regularly with analysts and institutional
shareholders to keep them informed of significant developments
and report to the Board accordingly on the views of the major
shareholders. The Senior Independent Director is also available to
attend such meetings, if required. Each of the other non-executive
directors is also offered the opportunity to attend meetings with
major shareholders and would do so if requested by any major
shareholder. The Company’s investor relations programme
includes formal presentations of full year and interim results.
Feedback from these meetings is provided to the Board. The
Company Secretary is also charged with bringing to the attention
of the Board any material matters of concern raised by the
Company’s shareholders, including private investors.
The Interim Report and the Annual Report and Accounts are the
primary means used by the Board for communicating during the
year with all of the Company’s shareholders. The Board also
recognises the importance of the Internet as a means of
communicating widely, quickly and cost-effectively and an
investor relations website (at www.halfordscompany.com) has
been developed to facilitate communications with shareholders.
Information available online includes copies of the full and half-
year financial statements, press releases and Company news,
corporate governance information and statements and the terms
of reference for the Audit, Nomination and Remuneration
Committees. 
The Board is committed to the constructive use of the Annual
General Meeting as a forum to meet with shareholders and to hear
their views and answer their questions about the Group and its
business. The Company will dispatch the notice of the Annual
General Meeting, with an explanatory circular describing any
items of special business, at least 20 working days before the
meeting. The Chairmen of the Remuneration, Nomination and
Audit Committees will normally attend the meeting and will answer
questions that may be relevant to the work of those Committees.
If they are unable to attend they will appoint a deputy to attend in
their place. It is the Company’s practice to propose separate
resolutions on each substantially separate issue at the Annual
General Meeting. The Chairman will advise shareholders on the
proxy voting details for each resolution after it has been put to 
the meeting.
The Company’s financial calendar is set out on page 70.
By order of the Board
Philip Parker, Company Secretary
6 June 2007 Directors’ Remuneration Report
30/31
Halfords Group plc Annual Report and Accounts 2007
The following report outlines the Company’s policy on the
remuneration of executive directors and gives details of the
remuneration packages of executive directors and of the fees paid
to non-executive directors for the year ended 30 March 2007. The
Report has been prepared in accordance with the requirements of
Schedule 7A to the Companies Act 1985. Part 3 of Schedule 7A
requires designated parts of the Remuneration Report to be
audited, whilst other parts are not. In preparing this report,
consideration has been given to the Listing Rules of the UK Listing
Authority and to the Combined Code and the report has been
approved by both the Remuneration Committee and by the Board.
A resolution to approve the report will be proposed at the Annual
General Meeting of the Company. 
Part A of the report, which is not subject to audit, sets out the
Company’s remuneration policy. Part B, which has been audited,
provides details of the remuneration, pensions and share
incentives of the directors for the 52 weeks to 30 March 2007.
■■ PART A — UNAUDITED INFORMATION
■■ REMUNERATION COMMITTEE
The Remuneration Committee, which met twice during the year,
comprises Keith Harris (Chairman), Richard Pym, Bill Ronald and
Nigel Wilson. The Committee’s terms of reference, which set out
the responsibilities of the Committee, are available from the
Company’s website, www.halfordscompany.com.
During the year, the Committee received external independent
advice from the Hay Group and Watson Wyatt on remuneration
matters. Neither company has any other connection with the
Group.
■■ REMUNERATION POLICY
The remuneration policy of the Committee and of the Board is to
provide remuneration packages for the executive directors and
other senior executives in the Group which are appropriate to the
size and nature of the Group’s business and which will attract and
retain high calibre executives. It is the Company’s policy that a
substantial proportion of the executive directors’ remuneration
should be performance related in order to encourage and reward
superior business performance and shareholder returns and that
remuneration should be linked to both individual and Company
performance. Accordingly, executive directors may earn up to an
additional 80% (100% in the case of the Chief Executive) of their
basic salaries as a performance bonus and have benefited from
participation in the Company’s share option scheme as set out
below. No further awards will be made under the share option
scheme to the executive directors but they were able to
participate in the 2005 Performance Share Plan (The Long-Term
Incentive Plan (“LTIP”)). The executive directors are also able to
participate in an all-employee save-as-you-earn scheme (the
“Halfords Sharesave Scheme”), referred to on page 31.
It is the policy of the Committee and the Board to maintain the
above approach to remuneration packages for executive directors
and other senior executives of the Group for the current financial
year and future financial years, subject to review in the light of any
changes in relevant legislation, regulations or market practice. No
significant changes to the remuneration arrangements for
executive directors are currently anticipated. However, the
Committee will continue to review base salaries and performance
targets to ensure that they align with the remuneration policy of
the Committee and the Board and with the Company’s strategic
objectives. The individual salary, bonus and benefit levels of the
executive directors are, and will continue to be, reviewed annually
by the Committee. 
It is the Company’s policy to employ executive directors under
contracts with an indefinite term, subject to termination by notice
given by either party of 12 months. Any compensation payable by
the Company would be subject to the normal legal principles of
mitigation of loss. No compensation would be payable if the
service contracts were to be terminated by notice from the
executive director or for lawful termination by the Company. There
are no provisions for payment of pre-determined compensation
under the service contracts. 
Details of individual directors’ remuneration and share options are
set out on pages 33 and 35 of this report. The main components
of the remuneration package for executive directors are:
BASIC SALARY
The Company’s policy is that basic salaries for executive directors
should take into account the individual’s role and responsibilities,
performance and experience. For an executive director who is
experienced and fully effective in his role, basic salary is targeted
at the retail market median for comparable roles. 
ANNUAL BONUS
Executive directors are eligible to receive an annual performance
bonus up to a maximum of 80% (100% in the case of the Chief
Executive) of their annual basic salary at the time the bonus
scheme is announced. The amount of bonus is based on the
achievement of profit and earnings per share targets, specified
and agreed at the beginning of the year. Bonus payments do not
form part of the directors’ pensionable earnings. The performance
targets for bonus entitlements are intended by the Remuneration
Committee to create incentives to perform at the highest levels.
SHARE OPTION SCHEMES
In May 2004 the Company adopted the Halfords Company Share
Option Scheme and the Halfords Sharesave Scheme, under which
employees are eligible for the grant of options to acquire ordinary
shares in the Company. HALFORDS COMPANY SHARE OPTION SCHEME
Options are granted at an exercise price not less than market
value at the date of grant and may normally only be exercised if
performance conditions set at the time of grant have been
achieved. These performance conditions require EPS (“earnings
per share”) for the financial year last preceding the third
anniversary of the grant date to equal or exceed the percentage
growth in RPI (retail price index) plus an additional percentage
determined as appropriate at the time of the grant. These
additional percentages were 6%, 5% and 3.5% for options
granted in 2004/05, 2005/06 and 2006/07 respectively.
Details of options granted to executive directors which are
outstanding and further details of the share option schemes,
including performance conditions, are set out on page 35.
The executive directors participate in the LTIP and no further awards
to them under the Company Share Option Scheme will be made.
HALFORDS SHARESAVE SCHEME
Options are granted at an exercise price not less than 80% of
market value at the date of grant. Options may not normally be
exercised until the option holder has completed his or her savings
contract (which will normally be three or five years) from the date
of commencement of the savings contract.
THE LONG-TERM INCENTIVE PLAN
Under the LTIP , approved by shareholders at the Annual General
Meeting in 2005, conditional rights to receive shares will be
awarded to participants. The extent to which such rights vest will
depend upon the Group’s performance over the three-year period
following the award date. The vesting of 50% of the awards will be
determined by the Group’s relative total shareholder return (“TSR”)
performance and the vesting of the other 50% by the Group’s
absolute earnings per share performance against RPI. The
Group’s TSR performance will be measured against the FTSE 350
general retailers as a comparator group. No retesting will be
permitted. In order to ensure that the performance targets for the
2007–2010 scheme remain stretching but achievable, the earnings
per share performance spread will be RPI plus 4% compound at
entry to RPI plus 11% compound at maximum.
Annual awards under the LTIP are normally 100% of base salary.
Paul McClenaghan was appointed to the Board of Halfords Group
plc on 31 March 2007. In order to more closely align him with
shareholders and with the equity participation of other current
Board members, the Remuneration Committee has decided to
make a one-off award of 200% of base annual salary under the
LTIP . This award will be subject to the same stretching
performance conditions as all other awards made under this plan.
On the vesting of any of this award Paul McClenaghan will be
encouraged to retain shares, so enabling him to achieve the
shareholding guidelines more quickly. 
The shareholding guidelines require executive directors, in post at
the time of the adoption of the LTIP , to retain shares to a value
equal to 200% of their basic annual salary. Newly appointed
executive directors will be required to acquire and retain shares to
a value equal to 100% of their basic annual salary over a five year
period following their appointment to the Board.
PENSIONS
The Halfords Pension Plan is a defined contribution scheme,
which is open to the executive directors. The Group’s
contributions during the year are shown in the table on page 34.
OTHER BENEFITS
Executive directors are entitled to be provided with a company car
or an equivalent allowance, contribution to a personal pension
scheme, permanent health insurance, life assurance cover,
membership of a private medical insurance scheme and travelling
and other expenses. Executive directors may also join the
Halfords Sharesave Scheme.
NON-EXECUTIVE DIRECTORS
The Board as a whole, following a recommendation by the Chief
Executive, determines the fees of the non-executive directors. 
The Company’s practice is to appoint non-executive directors
under letters of appointment, rather than under service contracts.
Those letters of appointment set out fixed terms of appointment
(normally three years).  Directors’ Remuneration Report
32/33
Halfords Group plc Annual Report and Accounts 2007
■■ PERFORMANCE GRAPH
Schedule 7A of the Companies Act 1985 requires listed
companies to provide, by graph, an analysis of the performance of
the Company over time as compared with an appropriate and
broad equity market index. The FTSE 350 general retail index has
been selected because it is a broad equity market index which
includes the Company’s shares and the Committee believes that
no other index would provide a more appropriate comparator,
given the nature of the Group’s activities.
The graph below shows the Total Shareholder Return (‘TSR’)
performance of an investment of £100 in Halfords Group plc shares
over the period following flotation (June 2004) compared with an
equivalent investment in the FTSE 350 general retail index. 
■■ EXECUTIVE DIRECTORS’ SERVICE CONTRACTS
Details of the executive directors’ service contracts are given
below.
Date of service Notice
agreement period
Ian McLeod 29 March 2005 12 months
Nick Wharton 17 May 2004 12 months
Paul McClenaghan 9 May 2005 12 months
The Company may terminate any of the above service contracts
by giving not less than 12 months’ notice. Any compensation
payable by the Company for early termination would be subject to
the normal legal principles of mitigation of loss. No compensation
would be payable if a service contract were to be terminated by
notice from an executive director or for lawful early termination by
the Company. 
Jun-04 Sept-04 Dec-04 Mar-05 Jun-05 Sept-05 Dec-05 Mar-06 Jun-06 Sept-06 Dec-06 Mar-07
170.00
160.00
150.00
140.00
130.00
120.00
110.00
100.00
90.00
Cumulative TSR 
based to 100
– Halfords Group plc – FTSE 350 General Retailers
Performance graph ■■ NON-EXECUTIVE DIRECTORS: LETTERS OF
APPOINTMENT
The non-executive directors have letters of appointment for a
three year period. For the non-executive directors below, the initial
three year period from the date of their appointment expires on 
7 June 2007. The Board has reappointed these directors for a
further three year period, with effect from 8 June 2007.
Unexpired
term at the 
Date of date of this 
appointment report
Richard Pym 17 May 2004 36 months
Keith Harris 17 May 2004 36 months
Nigel Wilson 17 May 2004 36 months
Bill Ronald 17 May 2004 36 months
Each letter of appointment is terminable by either party by giving
not less than three months’ notice or by the Company on payment
of fees in lieu of notice. No compensation would be payable to a
non-executive director if his engagement were terminated as a
result of him retiring by rotation at an annual general meeting, not
being elected or re-elected at an annual general meeting or
otherwise ceasing to hold office under the provisions of the
Articles of Association of the Company.
■■ PART B — AUDITED INFORMATION
The following section provides details of the remuneration, pension and share interests of the directors for the year ended 30 March
2007 and has been audited.
■■ DIRECTORS’ REMUNERATION
The remuneration and taxable benefits provided by the Company for each director for the 52 weeks to 30 March 2007 were as follows:
52 weeks to 30 March 2007 2006
Salaries/Fees Bonuses Benefits(5) Total Total
Executive directors Notes £’000 £’000 £’000 £’000 £’000
Ian McLeod 375 284 20 679 330
Nick Carter (2) 194 — 12 206 197
Nick Wharton (3) 37 23 2 62 —
606 307 34 947 527
Non-executive directors (4)
Richard Pym (6) 125 — — 125 60
Keith Harris 45 — — 45 40
Bill Ronald 40 — — 40 35
Nigel Wilson 60 — — 60 40
270 — — 270 175
Total 876 307 34 1,217 702
(1) Share options (see page 35) and pension (see page 34) are excluded from the table above.
(2) Nick Carter resigned as a director on 2 February 2007.
(3) Nick Wharton was appointed as a director on 3 February 2007.
(4) All non-executive directors were appointed on 17 May 2004. The remuneration of the Chairman and the other non-executive
directors consists only of annual fees for their services, both as members of the Board and of the Committees on which they serve.
(5) Benefits include all taxable benefits arising from employment by the Company, primarily the provision of a company car.
(6) With respect to Richard Pym’s fee of £125,000 pa, £40,000 pa of the total fee is paid direct to his employer, Alliance & Leicester plc. Directors’ Remuneration Report
continued
34/35
Halfords Group plc Annual Report and Accounts 2007
■■ DIRECTORS’ PENSIONS
Pension contributions to defined contribution money purchase schemes made by the Group during the 52 weeks to 30 March 2007 in
respect of executive directors were as follows:
52 Weeks to 52 Weeks to
30 March 31 March
2007 2006
Notes £’000 £’000
Ian McLeod 56 47
Nick Carter (1) 30 28
Nick Wharton (2) 10 —
96 75
(1) Nick Carter resigned as a director on 2 February 2007.
(2) Nick Wharton was appointed as a director on 3 February 2007.
■■ THE LONG-TERM INCENTIVE PLAN (“LTIP”)
The following table gives details of the conditional awards of shares made to the executive directors under the LTIP:
As at Lapsed Awarded As at Mid-market 
31 March in the in the 30 March price on day Performance
2006 period period 2007 of Award (£) Period
Ian McLeod
2005 LTIP 100,977 — — 100,977 3.07 3 yrs to 1 Apr 2008
2006 LTIP — — 124,584 124,584 3.01 3 yrs to 1 Apr 2009
Total 100,977 — 124,584 225,561 3.04
Nick Wharton
2005 LTIP 47,231* — — 47,231 3.07 3 yrs to 1 Apr 2008
2006 LTIP — — 50,000 50,000 3.01 3 yrs to 1 Apr 2009
Total 47,231 — 50,000 97,231 3.04
* At date of appointment. ■■ DIRECTORS’ INTERESTS IN SHARE OPTIONS
The following table details share options held by executive directors and not exercised at 30 March 2007:
As at Granted Exercised Lapsed As at Exercise
31 March in the during the during the 30 March Price Exercisable Exercisable
Note 2006 period period year 2007 (£) from to
Ian McLeod
Company Share Option Scheme (1) 192,308 — — — 192,308 2.60 2 June 2007 2 June 2014
Sharesave Scheme (2) 3,086 — — — 3,086 3.07 1 Oct 2008 1 Mar 2009
Total 195,394 — — — 195,394
Nick Wharton
Company Share Option Scheme (1) 125,000* — — — 125,000 2.60 2 June 2007 2 June 2014
Sharesave Scheme (2) 2,850* — — — 2,850 2.65 1 Aug 2007 1 Feb 2008
Total 127,850 — — — 127,850
* At date of appointment.
(1) Options granted under the Halfords Company Share Option Scheme are subject to the achievement of a three year performance
condition. For grants up to 150% of basic salary the options can only be exercised if the increase in the defined EPS over the period
is not less than the increase in the Retail Price Index (“RPI”) plus 6% per year. In the case of grants in excess of 150% of basic
salary, the excess can only be exercised in full if the increase is not less than RPI plus 10% per year. For increases in excess of 6%
but less than 10%, a proportion of the option in excess of 150% of salary can be exercised.
(2) The Halfords Sharesave Scheme is a Save-As-You-Earn scheme and is open to all full-time directors and employees with eligible
employment service. Options may be exercised under the scheme at £2.65 per share (2004 scheme) and £3.07 (2005 scheme) if the
option holder completes his saving contract for a period of three years and then not more than six months thereafter.
(3) The share options held by Nick Carter at 31 March 2006 lapsed in full on his resignation from the Board on 2 February 2007.
For details of the grant dates of options see note 20 on pages 60 and 61.
The closing share price on 30 March 2007 was 382.25 pence and the price range during the 52 weeks to 30 March 2007 was 284.2
pence to 395.25 pence.
The following table shows the beneficial interest of the directors and their families in the ordinary shares of the Company. 
■■ DIRECTORS’ INTERESTS IN SHARES
Shareholdings Shareholdings
as at as at
30 March 31 March
2007 2006
Executive directors
Ian McLeod 804,757 804,757
Nick Wharton 225,000 475,000
Non-executive directors
Richard Pym 21,538 11,538
Keith Harris 3,846 3,846
Bill Ronald 11,538 11,538
Nigel Wilson 10,000 10,000
From 30 March 2007 to 6 June 2007 there were no changes in the above interests. All of the above interests were beneficial at each of
the above dates. Ian McLeod and Nick Wharton were, at 30 March 2007 and at 6 June 2007, deemed to be interested as discretionary
beneficiaries of the Halfords Employees’ Share Trust, in so far as it relates to the share options noted on page 35. 877,498 ordinary
shares in the Company were held by the trustees of that Trust on those dates. Save as mentioned above, no director had any interest in
any share capital of the Company or of any subsidiary.
Approved by the Board and signed on its behalf by
Keith Harris, Chairman of the Remuneration Committee
6 June 2007 Statement of Directors’ Responsibilities
36/37
Halfords Group plc Annual Report and Accounts 2007
Company law requires the directors to prepare financial
statements for each financial period which provide a true and fair
view of the state of the affairs of the Company and of the Group
and of the profit or loss of the Group in that period. The directors
have prepared the financial statements for the Company in
accordance with UK GAAP . In preparing those statements the
directors are required to:
■ select suitable accounting policies and apply them
consistently;
■ make judgements and estimates that are prudent and
reasonable; 
■ state that the financial statements comply with IFRS or UK
GAAP as appropriate;
■ state whether applicable accounting standards have been
followed, and to disclose and explain and any material
departures from those standards; and
■ prepare the financial statements on a going concern basis
unless it is inappropriate to presume that the Group will
continue in business.
The directors are responsible for the financial statements on
pages 38 to 62 complying with all of the above requirements. The
maintenance and integrity of the Company’s website is the
responsibility of the directors and the Auditor accepts no
responsibility for any changes that may have occurred to the
financial statements since they were initially presented on the
Company’s website. Legislation in the United Kingdom
concerning the dissemination of financial statements may differ
from legislation in other jurisdictions.
The directors are also responsible for maintaining adequate
accounting records that disclose with reasonable accuracy at any
time the financial position of the Company and of the Group and
which allow them to ensure that the financial statements comply
with the requirements of the Companies Act 1985. They also have
a general responsibility at law for taking such suitable measures
as are available to them to safeguard the assets of the Company
and of the Group and to take reasonable steps to prevent and
detect fraud and other irregularities.
By order of the Board
Philip Parker, Company Secretary
6 June 2007 Independent Auditors’ Report to the Members of Halfords Group plc
We have audited the Group financial statements of Halfords Group
plc for the 52 weeks to 30 March 2007 which comprise the
Consolidated Income Statement, the Consolidated Balance Sheet,
the Consolidated Cash Flow Statement, the Consolidated
Statement of Changes in Shareholders’ Equity and the related
notes. These Group financial statements have been prepared
under the accounting policies set out therein.
We have reported separately on the Company financial statements
of Halfords Group plc for the 52 weeks to 30 March 2007 and on
the information in the Directors’ Remuneration Report that is
described as having been audited.
■■ RESPECTIVE RESPONSIBILITIES OF DIRECTORS 
AND AUDITORS
The directors’ responsibilities for preparing the Annual Report and
the Group financial statements in accordance with applicable law
and International Financial Reporting Standards (IFRS) as adopted
by the European Union are set out in the Statement of Directors’
Responsibilities.
Our responsibility is to audit the Group financial statements in
accordance with relevant legal and regulatory requirements and
International Standards on Auditing (UK and Ireland). This report,
including the opinion, has been prepared for and only for the
Company’s members as a body in accordance with Section 235 of
the Companies Act 1985 and for no other purpose. We do not, in
giving this opinion, accept or assume responsibility for any other
purpose or to any other person to whom this report is shown or
into whose hands it may come save where expressly agreed by
our prior consent in writing.
We report to you our opinion as to whether the Group financial
statements give a true and fair view and whether the Group
financial statements have been properly prepared in accordance
with the Companies Act 1985 and Article 4 of the IAS Regulation.
We also report to you whether in our opinion the information given
in the Directors’ Report is consistent with the Group financial
statements. The information given in the Directors’ Report
includes that specific information presented in the Chief
Executive’s Review and the Finance Director’s Report that is
cross-referenced from the Business Review section of the
Directors’ Report. In addition, we report to you if, in our opinion,
we have not received all the information and explanations we
require for our audit, or if information specified by law regarding
directors’ remuneration and other transactions is not disclosed.
We review whether the Corporate Governance Statement reflects
the Company’s compliance with the nine provisions of the 2003
FRC Combined Code specified for our review by the Listing Rules
of the Financial Services Authority, and we report if it does not. We
are not required to consider whether the Board’s statements on
internal control cover all risks and controls, or form an opinion on
the effectiveness of the Group’s corporate governance procedures
or its risk and control procedures.
We read other information contained in the Annual Report and
consider whether it is consistent with the audited Group financial
statements. The other information comprises only the Directors’
Report, the unaudited part of the Directors’ Remuneration Report,
the Chairman’s Statement, the Chief Executive’s Review, the
Finance Director’s Report, the Five Year Record and the Corporate
Governance statement. We consider the implications for our
report if we become aware of any apparent misstatements or
material inconsistencies with the Group financial statements. Our
responsibilities do not extend to any other information.
■■ BASIS OF AUDIT OPINION
We conducted our audit in accordance with International
Standards on Auditing (UK and Ireland) issued by the Auditing
Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the Group
financial statements. It also includes an assessment of the
significant estimates and judgements made by the directors in the
preparation of the Group financial statements, and of whether the
accounting policies are appropriate to the Group’s circumstances,
consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the
information and explanations which we considered necessary in
order to provide us with sufficient evidence to give reasonable
assurance that the Group financial statements are free from
material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the
overall adequacy of the presentation of information in the Group
financial statements.
■■ OPINION
In our opinion:
■ the Group financial statements give a true and fair view, in
accordance with IFRSs as adopted by the European Union, of
the state of the Group’s affairs as at 30 March 2007 and of its
profit and cash flows for the 52 weeks then ended;
■ the Group financial statements have been properly prepared in
accordance with the Companies Act 1985 and Article 4 of the
IAS Regulation; and
■ the information given in the Directors’ Report is consistent
with the Group financial statements.
PricewaterhouseCoopers LLP, 
Chartered Accountants and Registered Auditors
Birmingham
6 June 2007 Consolidated Income Statement
38/39
Halfords Group plc Annual Report and Accounts 2007
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006
Notes £m £m
Revenue 744.0 681.7
Cost of sales (367.9) (335.0)
Gross profit 376.1 346.7 
Operating expenses 2 (282.6) (257.6)
Operating profit 3 93.5 89.1 
Finance costs 5 (14.0) (12.5)
Finance income 5 1.4 0.4
Profit before tax 80.9 77.0 
Taxation 6 (23.5) (23.4)
Profit attributable to equity shareholders 57.4 53.6
Earnings per share
Basic 8 25.8p 23.6p
Diluted 8 25.6p 23.6p
All results relate to continuing operations of the Group. Consolidated Balance Sheet
30 March 31 March
2007 2006
Notes £m £m
Assets
Non-current assets
Goodwill 9 253.1 253.1
Other intangible assets 9 4.7 5.7
Property, plant and equipment 10 107.5 104.1
Derivative financial instruments 18 1.3 —
366.6 362.9
Current assets
Inventories 11 141.6 127.2
Trade and other receivables 12 32.6 29.4
Derivative financial instruments 18 — 1.2
Cash and cash equivalents 13 24.8 1.5
199.0 159.3
Total assets 565.6 522.2
Liabilities
Current liabilities
Borrowings 15 (13.3) (63.5)
Derivative financial instruments 18 (2.3) —
Trade and other payables 14 (113.5) (101.9)
Current tax liabilities (13.4) (13.1)
Provisions 16 (1.6) (1.2)
(144.1) (179.7)
Net current assets/(liabilities) 54.9 (20.4)
Non-current liabilities
Borrowings 15 (191.5) (111.7)
Derivative financial instruments 18 (0.1) (2.1)
Deferred tax liabilities 17 (0.9) (3.5)
Accruals and deferred income (25.9) (22.7)
(218.4) (140.0)
Total liabilities (362.5) (319.7)
Net assets 203.1 202.5
Shareholders’ equity
Share capital 19 2.2 2.3
Share premium account 133.2 133.2
Capital redemption reserve 0.1 —
Retained earnings 67.6 67.0
Total equity 203.1 202.5
The notes on pages 48 to 62 are an integral part of these consolidated financial statements. 
The financial statements on pages 38 to 62 were approved by the Board of Directors on 6 June 2007 and were signed on its behalf by: 
Nick Wharton, Finance Director Ian McLeod, Chief Executive  Consolidated Statement of Changes in Shareholders’ Equity
40/41
Halfords Group plc Annual Report and Accounts 2007
Retained
Share Capital earnings
Share premium redemption (hedging Retained Total
capital account reserve reserve) earnings equity
£m £m £m £m £m £m
Balance at 1 April 2005 2.3 132.9 — (2.9) 40.5 172.8
Profit for the period — — — — 53.6 53.6
Shares issued — 0.3 — — — 0.3
Cash flow hedges:
Fair value gains in the period — — — 3.2 — 3.2
Transfers to inventory — — — (0.8) — (0.8)
Transfers to net profit — — — (0.3) — (0.3)
Employee share options — — — — 1.3 1.3
Deferred tax on employee 
share options — — — — 0.4 0.4
Dividends — — — — (28.0) (28.0)
Balance at 31 March 2006 2.3 133.2 — (0.8) 67.8 202.5
Profit for the period — — — — 57.4 57.4
Purchase of own shares (0.1) — 0.1 — (30.0) (30.0)
Cash flow hedges:
Fair value losses in the period — — — (5.6) — (5.6)
Transfers to inventory — — — 3.5 — 3.5
Transfers to net profit — — — 2.3 — 2.3
Employee share options — — — — 2.1 2.1
Deferred tax on employee
share options — — — — 0.4 0.4
Dividends — — — — (29.5) (29.5)
Balance at 30 March 2007 2.2 133.2 0.1 (0.6) 68.2 203.1 Consolidated Cash Flow Statement
52 weeks to 52 weeks to
30 March 31 March
2007 2006 
Notes £m £m
Cash flows from operating activities
Cash generated from operations I 112.6 100.9
Finance income received 1.0 0.4
Finance costs paid (9.3) (11.0)
Cost of forward foreign exchange contracts — (0.9)
Taxation paid (25.4) (24.8)
Net cash from operating activities 78.9 64.6
Cash flows from investing activities
Purchase of intangible assets (0.7) (1.4)
Purchase of property, plant and equipment (23.2) (26.1)
Net cash used in investing activities (23.9) (27.5)
Cash flows from financing activities
Net proceeds from issue of ordinary share capital — 0.3
Purchase of own shares (30.0) —
Repayment of bank borrowings (144.0) (12.0)
Proceeds from new bank borrowings 180.0 —
Issue costs of new bank borrowings (1.0) —
Finance lease principal payments (0.3) (0.3)
Dividends paid to shareholders (29.5) (28.0)
Net cash used in financing activities (24.8) (40.0)
Net increase/(decrease) in cash, cash equivalents and bank overdrafts II 30.2 (2.9)
Cash, cash equivalents and bank overdrafts at the beginning of the period (18.4) (15.5)
Cash, cash equivalents and bank overdrafts at the end of the period II 11.8 (18.4) Notes to the Consolidated Cash Flow Statement
42/43
Halfords Group plc Annual Report and Accounts 2007
I. Cash generated from operations
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Operating profit 93.5 89.1
Depreciation — property, plant and equipment 19.2 19.6
Amortisation — intangible assets 1.7 1.9
Loss on sale of property, plant and equipment 0.2 0.5
Share option scheme charges 2.1 1.3
Fair value loss on derivative financial instruments 0.4 —
Increase in inventories (14.4) (18.9)
Increase in trade and other receivables (2.8) (5.8)
Increase in trade and other payables 12.3 13.6
Increase/(decrease) in provisions 0.4 (0.4)
112.6 100.9
II. Analysis of movements in the Group’s net debt in the period
At Other At
31 March non-cash 30 March
2006 Cash flow changes 2007
£m £m £m £m
Cash in hand and at bank 1.5 23.3 — 24.8
Bank overdraft (19.9) 6.9 — (13.0)
(18.4) 30.2 — 11.8
Debt due within one year (43.3) 44.0 (0.7) —
Debt due after one year (99.0) (79.0) (1.1) (179.1)
Total net debt excluding finance leases (160.7) (4.8) (1.8) (167.3)
Finance leases due within one year (0.3) 0.3 (0.3) (0.3)
Finance lease due after one year (12.7) — 0.3 (12.4)
Total finance leases (13.0) 0.3 — (12.7)
Total net debt (173.7) (4.5) (1.8) (180.0)
Non-cash changes relate to finance costs of £1.8m in relation to the amortisation of capitalised debt issue costs. Accounting Policies
■■ BASIS OF PREPARATION
The consolidated financial statements of Halfords Group plc (the “Company”) and its subsidiary undertakings ( the “Group”) are
prepared under the historical cost convention, except where IFRS requires an alternative treatment. The principal variations relate to
financial instruments (IAS 39 “Financial instruments: recognition and measurement”) and share-based payments (IFRS 2 “Share-based
payment”).
The financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”) and International Finance
Reporting Interpretation Committee (“IFRIC”) interpretations as adopted by the European Union and with those parts of the Companies
Act 1985 applicable to those companies reporting under IFRS.
The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires the use of
accounting estimates and management to exercise its judgement in the process of applying the Group’s accounting policies. These
judgements and estimates are based on historical experience and management’s best knowledge of the amounts, events or actions
under review and the actual results may ultimately differ from these estimates. Areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are, where necessary,
disclosed separately.
■■ NEW ACCOUNTING STANDARDS
Changes to accounting standards and interpretations and their likely impact on the Group’s future accounting policies are set out below:
IFRS 7 “Financial instruments: disclosures” is effective for accounting periods beginning on or after 1 January 2007, and will therefore
be applicable for the year ending March 2008, and IFRS 8 “Operating segments”, effective for accounting periods beginning on or after
1 January 2010, will be applicable in the year ended March 2011. These amendments to disclosure requirements will have no effect on
the Group’s reported results.
The Group does not consider that any other standards or interpretations issued by the IASB, but not yet applicable, will have a
significant impact on the consolidated financial statements.
■■ BASIS OF CONSOLIDATION
SUBSIDIARIES
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They cease to be consolidated from the
date that the Group no longer has control. All subsidiaries have been consolidated.
Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated on consolidation.
Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
The financial statements of all subsidiaries are prepared to the same reporting date as the Company. 
The principal subsidiary undertakings of the Company at 30 March 2007 are as follows:
Principal activity % Ownership
Halfords Holdings (2006) Limited Intermediate holding company 100
Halfords Holdings Limited Intermediate holding company 100
Halfords Finance Limited Intermediate holding company 100
Halfords Limited Retailing of auto parts, accessories, cycles and cycle accessories 100
■■ SEGMENTAL REPORTING
The Group has one main business segment, which is retail, and one main geographical segment, which is the United Kingdom. The
business segmental reporting format reflects the Group’s management and internal reporting structure.
■■ REVENUE RECOGNITION
Revenue comprises the fair value of the sale of goods and services to external customers, net of value added tax, rebates, promotions
and returns. Revenue is recognised on the sale of goods when the significant risks and rewards of ownership of the goods have passed
to the buyer and the amount of revenue can be measured reliably. Revenue on goods delivered is recognised when the customer
accepts delivery. The Group operates a variety of sales promotion schemes that give rise to goods being sold at a discount to standard
retail price. Revenue is adjusted to show sales net of all related discounts. A provision for estimated returns is made, representing the
profit on goods sold during the year, which will be returned and refunded after the year end based on past experience. Revenue is
reduced by the value of sales returns provided for during the year.
■■ EXCEPTIONAL ITEMS
Income or costs that are both material and non-recurring, whose significance is sufficient to warrant separate disclosure in the financial
statements, are referred to as exceptional items. These items are included and separately identified within their relevant income
statement category. Accounting Policies
continued
44/45
Halfords Group plc Annual Report and Accounts 2007
■■ FOREIGN CURRENCY TRANSLATION
FUNCTIONAL AND PRESENTATION CURRENCY
The consolidated financial statements are presented in sterling, which is the Group’s functional and presentation currency. Items
included in the financial statements of the Group’s entities are measured using the currency of the primary economic environment in
which the entity operates (the functional currency).
TRANSACTIONS AND BALANCES
Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction. At each balance sheet
date, monetary assets and liabilities denominated in foreign currencies are retranslated at the exchange rate prevailing at the balance
sheet date. Translation differences on monetary items are taken to the income statement with the exception of differences on
transactions that are subject to effective cash flow hedges.
Translation differences on non-monetary items are reported as part of the fair value gain or loss and are included in either equity or the
income statement as appropriate.
■■ SHARE-BASED PAYMENTS
The Group operates a number of equity-settled, share-based compensation plans.
The fair value of the employee services received under such schemes is recognised as an expense in the income statement. Fair value
is determined by use of the Black Scholes Option Pricing Model. The amount to be expensed over the vesting period is determined by
reference to the fair value of share incentives, excluding the impact of any non-market vesting conditions. Non-market vesting
conditions are included in assumptions about the number of share incentives that are expected to vest. At each balance sheet date, the
Group revises its estimates of the number of share incentives that are expected to vest. The impact of the revision of original estimates,
if any, is recognised in the income statement, with a corresponding adjustment to equity, over the remaining vesting period.
■■ EQUITY DIVIDENDS
Final dividends are recognised in the Group’s financial statements in the period in which the dividends are approved by shareholders.
Interim equity dividends are recognised in the period they are paid.
■■ PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are held at cost less accumulated depreciation and any impairment in value.
Depreciation of property, plant and equipment is provided to write off the cost, less residual value, on a straight-line basis over their
useful economic lives as follows:
■ Leasehold premises with lease terms of 50 years or less are depreciated over the remaining period of the lease
■ Motor vehicles are depreciated over 3 years 
■ Store fixtures are depreciated over the period of the lease to a maximum of 25 years
■ Fixtures, fittings and equipment are depreciated over 4 to 10 years according to the estimated life of the asset
■ Computer equipment is depreciated over 3 years
■ Land is not depreciated
■ Assets in the course of construction are not depreciated until commissioned
Residual values, remaining useful economic lives and depreciation periods and methods are reviewed annually and adjusted if
appropriate. 
■■ GOODWILL AND INTANGIBLE ASSETS
Goodwill is the excess of the fair value of the consideration payable for an acquisition over the fair value of the Group’s share of
identifiable net assets of a subsidiary acquired at the date of acquisition. Fair value is attributed to the identifiable assets, liabilities and
contingent liabilities that existed at the date of acquisition, reflecting their condition at that date. Adjustments are made where
necessary to bring the accounting policies of acquired businesses into alignment with those of the Group.
Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill is stated at cost less any impairment. Goodwill is not
amortised but is tested annually for impairment. An impairment charge is recognised for any amount by which the carrying value of
goodwill exceeds its fair value.
Costs that are directly associated with the production of identifiable and unique software products controlled by the Group and that 
will generate economic benefits beyond one year are recognised as intangible assets. These intangible assets are stated at cost less
accumulated amortisation and impairment losses. Software is amortised over 3 to 5 years depending on the estimated useful 
economic life.
■■ FINANCIAL INSTRUMENTS
The Group holds financial instruments that have been classified as financial assets and liabilities and loans and receivables. LOANS AND RECEIVABLES
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.
They arise when the Group provides money, goods or services directly to a debtor with no intention of trading the receivable. They are
included in current assets, except for those with maturities greater than 12 months after the balance sheet date, which are classified as
non-current assets. Loans and receivables are included in trade and other receivables in the balance sheet.
■■ ACCOUNTING FOR DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
Derivatives are recognised at fair value on the date a contract is entered into and are subsequently re-measured at their fair value.
The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument and, if
so, the nature of the item being hedged. The Group designates certain derivatives as:
■ Fair value hedges — hedges of the fair value of recognised assets or liabilities or a firm commitment; or
■ Cash flow hedges — hedges of highly probable forecast transactions
The Group documents the relationship between hedging instruments and hedged items at the hedge inception stage, as well as its risk
management objective and strategy for undertaking various hedge transactions. The Group also documents its assessment, both at
hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in
offsetting changes in fair value or cash flow hedged items. Movements on the hedging reserve in equity are shown in the consolidated
statement of changes in shareholders’ equity. 
FAIR VALUE HEDGES
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement,
together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
CASH FLOW HEDGES
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognised in
equity. The gain or loss relating to the ineffective portion is recognised immediately in the income statement.
Amounts accumulated in equity are recycled in the income statement in the periods when the hedged item will affect profit or loss (for
instance when the forecast purchase that is hedged takes place). However, when the forecast transaction that is hedged results in the
recognition of a non-financial asset or liability, the gains and losses previously deferred in equity are transferred from equity and
included in the initial measurement of the cost of the asset or liability. When a hedging instrument expires or is sold, or when a hedge no
longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is
recognised when the forecast transaction is ultimately recognised in the income statement. When a forecast transaction is no longer
expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement.
NON-HEDGING DERIVATIVES
Changes in the fair value of any derivative instrument that does not qualify for hedge accounting are recognised immediately in the
income statement.
■■ FAIR VALUE ESTIMATION
The fair value of interest rate swaps is calculated as the present value of the estimated future cash flows. The fair value of forward
foreign exchange contracts is determined using forward exchange rates at the balance sheet date. The nominal value less estimated
credit adjustments of trade receivables and payables are assumed to approximate to their fair values.
■■ TRADE RECEIVABLES
Trade receivables are recognised and carried at original invoice amount less provision for impairment.
A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect
all amounts due according to the original terms of receivables. The amount of the provision is recognised in the income statement. 
■■ INVENTORIES
Inventories are valued at the lower of cost and net realisable value. Cost comprises the purchase cost of goods, adjusted for rebates
and costs related to distribution.
■■ IMPAIRMENT OF ASSETS
Intangible assets that are attributed an indefinite useful life are not subject to amortisation but are tested annually for impairment. Other
tangible and intangible assets that are subject to amortisation and depreciation are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount
by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less
costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash flows (cash-generating units). Each store is deemed to be a cash-generating unit. Accounting Policies
continued
46/47
Halfords Group plc Annual Report and Accounts 2007
■■ CASH AND CASH EQUIVALENTS
Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid investments with
original maturities of three months or less and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the
balance sheet. For the purpose of the consolidated cash flow statement, cash and cash equivalents are as defined above, net of
outstanding bank overdrafts.
■■ BORROWINGS AND BORROWING COSTS
All loans and borrowings are initially recognised at the fair value of the consideration received net of issue costs associated with the
borrowing. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and
the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method.
Borrowing costs are expensed in the period in which they are incurred, except for issue costs, which are amortised over the period of
the borrowing.
■■ BASIS OF CHARGE FOR TAXATION
The tax base of an asset is the amount that will be deductible for tax purposes against any taxable economic benefits that will flow to
an entity when it recovers the carrying amount of the asset. If those economic benefits will not be taxable, the tax base of the asset is
equal to its carrying amount.
The tax base of a liability is its carrying amount, less any amount that will be deductible for tax purposes in respect of that liability in
future periods. In the case of revenue which is received in advance, the tax base of the resulting liability is its carrying amount, less any
amount of the revenue that will not be taxable in future periods.
■■ DEFERRED TAXATION
Deferred taxation is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated financial statements. However, if the deferred taxation arises from initial
recognition of an asset or liability in a transaction other than a business combination, that at the time of the transaction affects neither
accounting nor taxable profit or loss, it is not accounted for. Deferred taxation is calculated using rates that are expected to apply when
the related deferred asset is realised or the deferred taxation liability is settled.
Deferred taxation assets are recognised to the extent that it is probable that future taxable profit will be available against which the
temporary differences can be utilised.
■■ PROVISIONS
Provisions are recognised when:
■ The Group has a present legal or constructive obligation as a result of past events;
■ It is more likely than not that an outflow of resources will be required to settle the obligation; and
■ The amount can be reliably estimated.
Provisions are not recognised for future operating losses. Where there are a number of similar obligations, the likelihood that an outflow
will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the
likelihood of an outflow with respect to any one item included in the same class of obligations may be small.
Where the Group expects a provision to be reimbursed, the reimbursement is recognised as a separate asset when the reimbursement
is certain.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax
rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Where
discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
■■ LEASES
FINANCE LEASES
Leases of property, plant and equipment where the Group has substantially all the risks and rewards of ownership are classified as a
finance lease. Finance leases are capitalised at the lease’s inception at the lower of the fair value of the leased property and the present
value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a
constant rate on the finance balance outstanding. The corresponding rental obligations, net of finance charges, are included in other
long-term payables. The interest element of the finance cost is charged to the income statement over the lease period so as to produce
a constant periodic rate of interest on the remaining balance of the liability for each period. Property, plant and equipment acquired
under finance leases are depreciated over the shorter of the useful life of the asset and its lease term. In determining whether a lease is
a finance lease, the building and land elements of the lease are reviewed separately. OPERATING LEASES
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases.
Payments made under operating leases are charged to the income statement on a straight-line basis over the period of the lease.
Incentives from lessors are recognised as a systematic reduction in the charge over the lease term.
LANDLORD CONTRIBUTIONS
Contributions received from landlords that do not represent an incentive for future rental commitments are recognised in the income
statement on the exchange of contracts. This income is netted off against selling and distribution costs.
SUBLEASE INCOME
The Group leases properties from which it no longer trades. These properties are often sublet to third parties. Rents receivable are
recognised by offsetting the income against rental costs accounted for within selling and distribution costs in the income statement. 
■■ PENSIONS
Colleagues are offered membership of Halfords Pension Plan, a defined contribution pension arrangement. The costs of contributions to
the scheme are charged to the income statement in the period that they arise.
■■ ESTIMATES AND JUDGEMENTS
The preparation of the consolidated financial statements requires management to make judgements, estimates and assumptions that
affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated
assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances,
the results of which form the basis of making judgements about the carrying value of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from the estimates.
The judgements and key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial
statements are detailed below:
IMPAIRMENT OF ASSETS
Goodwill and other assets are subject to impairment reviews if current or future events and circumstances suggest that their
recoverable value may be less than their carrying value or if they are attributed an indefinite useful life. The recoverable amount is based
on a calculation of expected future cash flows, which includes management assumptions and estimates of future performance. Details
of the assumptions used in the valuation of goodwill are explained in note 9.
ALLOWANCES AGAINST THE CARRYING VALUE OF INVENTORIES
The Group reviews the market value of and demand for its inventories on a periodic basis to ensure that recorded inventory is stated at
the lower of cost and net realisable value. In assessing the ultimate realisation of inventories, the Group is required to make judgements
as to future demand requirements and to compare these with the current or committed inventory levels. Factors that could impact
estimated demand and selling prices are the timing and success of product ranges.
PROVISIONS
Provisions have been estimated for onerous leases and estimated sales returns. These provisions are estimates of the actual costs of
future cash flows and are dependent on future events. Any difference between expectations and the actual future liability will be
accounted for in the period when such determination is made. Notes to the Financial Statements
48/49
Halfords Group plc Annual Report and Accounts 2007
1. SEGMENTAL REPORTING
The Group has one main business segment, which is retail, and one main geographical segment, which is the United Kingdom. The
business segmental reporting format reflects the Group’s management and internal reporting structure. 
2. OPERATING EXPENSES
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Selling and distribution costs 240.1 221.5
Administrative expenses 42.5 36.1
282.6 257.6
3. OPERATING PROFIT
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Operating profit is arrived at after charging/(crediting):
Operating lease rentals:
— plant and machinery 1.0 0.8
— property rents 70.9 66.3
— rentals receivable under operating leases (9.8) (10.7)
Landlord contributions (4.5) (6.9)
Loss on disposal of property, plant and equipment 0.2 0.5
Amortisation of intangible assets (included in administrative expenses) 1.7 1.9
Depreciation of: 
— owned property, plant and equipment 18.6 18.9
— assets held under finance leases 0.6 0.7
Net foreign exchange gains — (2.0)
Trade receivables impairment 0.2 —
The total fees payable by the Group to PricewaterhouseCoopers LLP and their associates during the period was £0.5m (2006: £0.5m)
in respect of the services detailed below: 
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£’000 £’000
Fees payable for the audit of the parent company and consolidated accounts 28 37
Fees payable to PricewaterhouseCoopers LLP and their associates for other services:
The audit of the Company’s subsidiaries, pursuant to legislation 119 111
Other services supplied pursuant to such legislation 21 21
Other services relating to taxation 263 232
All other services 95 77
Fees in respect of the audit of Halfords Pension Plan 20 20
546 498 4. EMPLOYEE BENEFIT EXPENSE
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
The aggregated remuneration of all employees including directors comprised:
Wages and salaries 97.5 88.5
Social security costs 7.1 6.8
Share-based payment charge 2.1 1.3
Other pension costs (note 22) 3.1 3.3
109.8 99.9
Number Number
Average number of persons employed by the Group during the period:
Stores 9,637 9,385
Central warehousing 205 223
Head office 483 461
10,325 10,069
Full details of directors’ remuneration and interests are set out in the Directors’ Remuneration Report on pages 30 to 35.
Key management compensation
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Salaries and short-term benefits 2.2 1.4
Social security costs 0.3 0.2
Pensions 0.2 0.2
Share-based payment charge 0.5 0.7
3.2 2.5
Key management compensation includes the emoluments of the Board of Directors, which are disclosed separately in the Directors’
Remuneration Report, and the emoluments of the Halfords Limited Board.  Notes to the Financial Statements
continued
50/51
Halfords Group plc Annual Report and Accounts 2007
5. NET FINANCE COSTS
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Finance costs:
Bank borrowings (10.0) (9.7)
Amortisation of issue costs on loans (0.3) (0.7)
Commitment and guarantee fees (0.2) (0.3)
Cost of forward foreign exchange contracts — (0.9)
Interest payable on finance leases (0.9) (0.9)
Finance costs before exceptional finance costs (11.4) (12.5)
Exceptional finance costs:
Accelerated amortisation of issue costs on loans(1) (1.5) —
Swap close out costs(2) (1.1) —
(2.6) —
Finance costs (14.0) (12.5)
Finance income: Bank and similar interest 1.4 0.4
Net finance costs (12.6) (12.1)
(1) On 14 July 2006 the Group replaced its existing borrowings with a five-year term loan of £180m and a revolving credit facility of
£120m. As a consequence, a charge of £1.5m was made in respect of the accelerated amortisation of the issue costs associated
with the original borrowings.
(2) On 29 September 2006 the Group closed out the interest rate swap on its old borrowings at a cost of £1.1m. On the same date, the
interest on the new £180m term loan was fixed for a three-month period. On 29 December the Group entered into a new interest
rate swap for £70m for the length of the new facility. 
6. TAXATION 
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Current taxation
UK corporation tax charge for the period 26.1 25.8
Adjustment in respect of prior periods (0.4) (1.2)
25.7 24.6
Deferred taxation
Origination and reversal of timing differences (1.9) (1.5)
Adjustment in respect of prior periods (0.3) 0.3
(2.2) (1.2)
Total tax charge for the period 23.5 23.4
The tax charge is reconciled with the standard rate of UK corporation tax as follows:
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Profit before tax 80.9 77.0
UK corporation tax at standard rate of 30.0% (2006: 30%) 24.3 23.1
Factors affecting the charge for the period:
Depreciation on expenditure not eligible for tax relief 0.7 1.1
Deduction for employee share options — (0.3)
Impact of intra-group financing (1.4) —
Other disallowable expenses 0.6 0.4
Adjustment in respect of prior periods (0.7) (0.9)
Total tax charge for the period 23.5 23.4 7. DIVIDENDS
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Equity — ordinary shares
Final for the 52 weeks ended 31 March 2006 — paid 8.75p (2006: 8.3p) 19.8 18.9
Interim — paid 4.35p (2006: 4.0p) 9.7 9.1
29.5 28.0
In addition, the directors are proposing a final dividend in respect of the financial year ended 30 March 2007 of 9.50p per share, which
will absorb an estimated £20.8m of shareholders’ funds. It will be paid on 1 August 2007 to shareholders who are on the register of
members on 29 June 2007.
8. EARNINGS PER SHARE
Basic earnings per share are calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number
of ordinary shares in issue during the period. The weighted average number of shares excludes shares held by an Employee Benefit
Trust (see note 19) and has been adjusted for the issue/repurchase of shares during the period. 
For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all
dilutive potential ordinary shares. These represent share options granted to employees where the exercise price is less than the
average market price of the Company’s ordinary shares during the 52 weeks to 30 March 2007. 
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
Number Number
m m
Weighted average number of shares in issue 223.8 228.0
Less: shares held by the Employee Benefit Trust (0.9) (0.9)
Weighted average number of shares for calculating basic earnings per share 222.9 227.1
Weighted average number of dilutive shares 0.9 0.2
Total number of shares for calculating diluted earnings per share 223.8 227.3
The alternative measure of earnings per share is provided because it reflects the Group’s underlying performance by excluding the
effect of exceptional items.
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
£m £m
Basic earnings attributable to equity shareholders 57.4 53.6
Exceptional items:
Finance costs (see note 5) 2.6 —
Tax on exceptional finance costs (0.8) —
Underlying earnings before exceptional items 59.2 53.6
Earnings per share is calculated as follows:
For the period 52 weeks to 52 weeks to
30 March 31 March
2007 2006 
Basic earnings per ordinary share 25.8p 23.6p
Diluted earnings per ordinary share 25.6p 23.6p
Basic earnings per ordinary share before exceptional items 26.6p 23.6p
Diluted earnings per ordinary share before exceptional items 26.5p 23.6p Notes to the Financial Statements
continued
52/53
Halfords Group plc Annual Report and Accounts 2007
9. INTANGIBLE ASSETS 
Computer Product
software rights Goodwill Total
£m £m £m £m
Cost
At 1 April 2005 7.4 0.2 274.8 282.4
Additions 1.4 — — 1.4
At 31 March 2006 8.8 0.2 274.8 283.8
Additions 0.7 — — 0.7
At 30 March 2007 9.5 0.2 274.8 284.5
Amortisation
At 1 April 2005 1.2 0.2 21.7 23.1
Charge for the period 1.9 — — 1.9
At 31 March 2006 3.1 0.2 21.7 25.0
Charge for the period 1.7 — — 1.7
At 30 March 2007 4.8 0.2 21.7 26.7
Net book value at 30 March 2007 4.7 — 253.1 257.8
Net book value at 31 March 2006 5.7 — 253.1 258.8
Net book value at 1 April 2005 6.2 — 253.1 259.3
The Group has one main business segment, which is retail, and one main geographical segment, which is the United Kingdom, and as
such goodwill is calculated assuming one cash-generating unit (“CGU”).
The recoverable amount of goodwill is determined based on ‘value-in-use’ calculations. These calculations use cash flow projections
based on financial budgets approved by management covering a five-year period. 
The key assumptions used in the value-in-use calculation for goodwill held at 30 March 2007 and 31 March 2006 are as follows:
Notes 2007 2006
Discount rate (1) 8.6% 8.6%
Growth rate (2) 0.0% 0.0%
Tax rate 31.9% 31.9%
Notes:
(1) Post-tax discount rate applied to the cash flow projections.
(2) Growth rate used to extrapolate cash flows beyond the budget period. 10. PROPERTY, PLANT AND EQUIPMENT 
Payments on
Short account and
leasehold Fixtures, assets in
land and fittings and course of
buildings equipment construction Total
£m £m £m £m
Cost 
At 1 April 2005 41.0 211.0 0.4 252.4
Additions 2.2 23.2 1.0 26.4
Disposals (0.1) (2.2) — (2.3)
Reclassifications 0.20.2(0.4)—
At 31 March 2006 43.3 232.2 1.0 276.5
Additions 2.1 16.0 4.7 22.8
Disposals (0.1) (0.9) — (1.0)
Reclassifications 0.20.2(0.4)—
At 30 March 2007 45.5 247.5 5.3 298.3
Depreciation
At 1 April 2005 12.5 142.1 — 154.6
Depreciation for the period 1.9 17.7 — 19.6
Disposals (0.1) (1.7) — (1.8)
At 31 March 2006 14.3 158.1 — 172.4
Depreciation for the period 2.0 17.2 — 19.2
Disposals — (0.8) — (0.8)
At 30 March 2007 16.3 174.5 — 190.8
Net book value at 30 March 2007 29.2 73.0 5.3 107.5
Net book value at 31 March 2006 29.0 74.1 1.0 104.1
Net book value at 1 April 2005 28.5 68.9 0.4 97.8
Included in the above are assets held under finance leases as follows: 
Fixtures,
Land and fittings, and
buildings equipment Total
£m £m £m
As at 30 March 2007
Cost 12.7 0.8 13.5
Accumulated depreciation (1.5) (0.5) (2.0)
Net book value 11.2 0.3 11.5
As at 31 March 2006
Cost 12.7 0.8 13.5
Accumulated depreciation (1.0) (0.4) (1.4)
Net book value 11.7 0.4 12.1
No fixed assets are held as security for external borrowings.  Notes to the Financial Statements
continued
54/55
Halfords Group plc Annual Report and Accounts 2007
11. INVENTORIES
2007 2006
£m £m
Finished goods for resale 141.6 127.2
The Group consumed £364.1m (2006: £335.2m) of inventories during the period.
Finished goods inventories include £5.6m (2006: £5.8m) of provisions to carry inventories at fair value less costs to sell where such
value is lower than cost. The Group did not reverse any unutilised provisions during the period.
12. TRADE AND OTHER RECEIVABLES
2007 2006
£m £m
Falling due within one year:
Trade receivables 3.8 4.0
Less: provision for impairment of receivables (0.3) (0.1)
Trade receivables — net 3.5 3.9
Other receivables 8.5 5.1
Prepayments and accrued income 20.6 20.4
32.6 29.4
There is no concentration of credit risk with respect to trade receivables, as the Group has a large number of customers.
13. CASH AND CASH EQUIVALENTS
2007 2006
£m £m
Cash at bank and in hand 24.8 1.5
Cash and bank overdrafts include the following for the purposes of the cash flow statement:
2007 2006
£m £m
Cash at bank and in hand 24.8 1.5
Bank overdrafts (13.0) (19.9)
11.8 (18.4)
The Group’s banking arrangements are subject to a netting facility whereby credit balances may be offset against the indebtedness of
other Group companies. 14. TRADE AND OTHER PAYABLES — CURRENT
2007 2006
£m £m
Trade payables 65.1 65.2
Other taxation and social security payable 16.5 17.0
Other payables 0.8 1.5
Accruals and deferred income 31.1 18.2
113.5 101.9
15. BORROWINGS
2007 2006
Current £m £m
Bank loans and overdrafts due within one year or on demand — unsecured 13.0 63.2
Finance leases 0.3 0.3
13.3 63.5
Non-current
Bank loan — unsecured 179.1 99.0
Finance leases 12.4 12.7
191.5 111.7
The above borrowings are stated net of unamortised issue costs of £0.9m (2006: £1.7m).
The exposure of borrowings to interest rate changes when borrowings reprice is as follows:
1 year 1–5 years Total
£m £m £m
Total borrowings as at 30 March 2007 192.1 — 192.1
Effect of interest rate swaps (70.0) 70.0 —
122.1 70.0 192.1
1 year 1–5 years Total
£m £m £m
Total borrowings as at 31 March 2006 162.2 — 162.2
Effect of interest rate swaps (100.0) 100.0 —
62.2 100.0 162.2
The effective interest rates at the balance sheet date were as follows:
2007 2006
Bank overdraft 6.25% 5.50%
Bank borrowings 5.49% 5.22%
Finance leases 7.14% 7.14% Notes to the Financial Statements
continued
56/57
Halfords Group plc Annual Report and Accounts 2007
15. BORROWINGS continued
Maturity of financial liabilities
The maturity profile of the carrying amount of the Group’s non-current liabilities at 30 March 2007 was as follows:
Finance 2007 Finance 2006
Debt leases Total Debt leases Total
£m £m £m £m £m £m
Expiring between 1 and 2 years — 0.2 0.2 19.5 0.3 19.8
Expiring between 2 and 5 years 179.1 0.7 179.8 79.5 0.9 80.4
Expiring after 5 years — 11.5 11.5 — 11.5 11.5
179.1 12.4 191.5 99.0 12.7 111.7
The Group completed a debt refinancing exercise on 14 July 2006. The debt facility now comprises a £180m 5-year non-amortising
loan, maturing with a bullet repayment on 13 July 2011 and a £120m revolving credit facility. This facility is underwritten by The Royal
Bank of Scotland Group plc and the syndication group allocations were effected from 29 September 2006.
The term loan attracts interest rate of LIBOR plus a fixed margin of 0.45%, and the rate is set biannually. An interest rate swap is in
place for £70m and mirrors the biannual rate setting of the term loan facility. The revolving credit facility permits further borrowings to a
maximum of £120m. This facility matures on 13 July 2011 and drawings under the facility attract interest at LIBOR plus 0.45%–0.50%
dependent upon covenant fulfilment.
Borrowing facilities
The Group has the following undrawn committed borrowing facilities available at the period end in respect of which all conditions
precedent had been met at that date:
2007 2006
£m £m
Expiring within 1 year 1.0 1.0
Expiring between 2 and 5 years 120.0 106.9
121.0 107.9
The facilities expiring within one year were annual facilities subject to review at various dates during the period. The other facilities
were arranged to help finance the proposed expansion of the Group’s activities. All these facilities incurred commitment fees at 
market rates.
The minimum lease payments under finance leases fall due as follows:
2007 2006
£m £m
Not later than one year 1.1 1.1
Later than one year but not more than five years 4.1 4.2
More than five years 19.0 20.1
24.2 25.4
Future finance charges on finance leases (11.5) (12.4)
Present value of finance lease liabilities 12.7 13.0
16. PROVISIONS 
Vacant
property Returns Total
£m £m £m
At 31 March 2006 0.7 0.5 1.2
Charged during the period 0.5 0.9 1.4
Utilised during the period (0.5) (0.5) (1.0)
At 30 March 2007 0.7 0.9 1.6
Both of the above provisions are classified as current as they are expected to be utilised in the next financial year.
Provisions include a vacant property provision of £0.7m (2006: £0.7m) and a provision of £0.9m (2006: £0.5m) in respect of estimated
sales returns. The vacant property provision represents recognition of the net costs arising from vacant properties and sub-let
properties. 17. DEFERRED TAX
Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 30% (2006: 30%).
2007 2006
£m £m
The movement on the deferred taxation provision is shown below:
At the beginning of the period 3.5 5.1
Income statement credit (2.2) (1.2)
Credited to equity (0.4) (0.4)
At the end of the period 0.9 3.5
Deferred tax assets and liabilities are only offset where there is a legally enforceable right of offset and there is an intention to settle the
balances net.
Deferred tax liabilities:
Accelerated tax
depreciation
£m
At 1 April 2005 (8.7)
Credit to the income statement 0.3
At 31 March 2006 (8.4)
Credit to the income statement 0.5
At 30 March 2007 (7.9)
Deferred tax assets:
Provisions and 
share options
£m
At 1 April 2005 3.6
Credit to the income statement 0.9
Credit to equity 0.4
At 31 March 2006 4.9
Credit to the income statement 1.7
Credit to equity 0.4
At 30 March 2007 7.0
Net deferred tax liability
At 31 March 2006 3.5
At 30 March 2007 0.9 Notes to the Financial Statements
continued
58/59
Halfords Group plc Annual Report and Accounts 2007
18. DERIVATIVE FINANCIAL INSTRUMENTS
Fair value of derivative financial instruments
The Group’s policy is to hedge the following exposures:
■ Interest rate risk — using interest swaps.
■ Forward foreign currency contracts are also used for currency exposures on future expected purchases.
All the gains and losses on the hedging instruments are expected to be matched by losses and gains on the hedged transactions or
positions. Under the Group’s accounting policy, foreign currency transactions, which are hedged using forward foreign currency
contracts, are translated at the contracted rates. Consequently, the carrying value of the relevant asset or borrowings effectively
includes the gain or loss on the hedging instrument. 
2007 2007 2006 2006
Assets Liabilities Assets Liabilities
£m £m £m £m
Interest rate swaps 1.3 — — 2.1
Forward foreign currency contracts —2.4 1.2 —
Total 1.3 2.4 1.2 2.1
Less non-current portion
Interest rate swaps (1.3) — — (2.1)
Forward foreign currency contracts — (0.1) ——
Current portion —2.3 1.2 —
Forward foreign exchange contracts
The notional principal amounts of the outstanding forward foreign exchange contracts at 30 March 2007 are £71.9m (2006: £63.5m).
Gains and losses in equity on forward foreign exchange contracts as of 30 March 2007 will be released to the income statement at
various dates between one and thirteen months from the balance sheet date.
Interest rate swaps
The notional principal amount of the outstanding interest rate swap contract at 30 March 2007 was £70m (2006: £120m). At 30 March
2007 the fixed interest rate was 5.165% and the floating rate is LIBOR.
Treasury policy
The Group’s objective in using financial instruments is to minimise its exposure to financial risk. The Group’s treasury department’s main
responsibilities are to:
■ Ensure adequate funding and liquidity for the Group;
■ Manage the interest risk of the Group’s debt;
■ Invest surplus cash; 
■ Manage the clearing bank operations of the Group; and
■ Manage the foreign exchange risk on its non-sterling cash flows.
The main risk arising from the Group’s financial instruments is interest rate risk. Policies for managing financial risks are governed 
by Board approved policies and procedures, which are reviewed on an annual basis. The latest policy review was performed in
December 2006.
The Group’s debt management policy is to provide an appropriate level of funding to finance the Business Plan over the next three to
five years at a reasonable cost and ensure adequate flexibility to meet the changing needs of the enterprise.
Financial risk
The Business Plan and cash flow forecasts are subject to key assumptions such as interest rates and the significance of these risks is
dependent upon the level of the trading profit and the strength of the balance sheet.
Interest rate risk
The Group maintains its policy to minimise interest rate risk on its borrowings and deposits by using interest rate derivatives where
appropriate. The Group’s policy aims to manage the interest cost of the Group within the constraints of the Business Plan and its
financial covenants. The aim is to reduce exposure to the effect of interest rates movements by hedging at least 40% of the following
period’s net interest rate exposure, whilst maintaining the flexibility to minimise early termination costs. 18. DERIVATIVE FINANCIAL INSTRUMENTS continued
Foreign currency risk
The Group has a significant transaction exposure with increasing, direct source purchases of its supplies from the Far East, with most
of the trade being specifically US dollar denominated. The Group’s policy is to manage the foreign exchange transaction exposures of
the business for a minimum period of twelve months forward to ensure the actual costs do not exceed the budget costs by 10%
(excluding increases in the base cost of the product). The Group does not hedge either economic exposure or the translation exposure
arising from the profits, assets and liabilities of non-sterling business whilst they remain immaterial.
Credit risk
The Group’s policy is to minimise the risk that foreign exchange and interest rate derivative counterparties, the holders of surplus cash
and the providers of debt will be unable to fulfil their obligations and also, in the case of lenders, unwilling to renegotiate the terms of
the borrowings. The Group ensures that such counterparties used for credit transactions hold at least an A credit rating.
Liquidity risk
The Group ensures that it has sufficient cash or loan facilities to meet all its commitments when required. The Group ensures that it
has sufficient funding to meet its Business Plan requirements so that it is not reliant on there being sufficient liquidity in the market
when it needs the funding.
Fair values of non-derivative financial liabilities
The following table is a comparison by category of the carrying amounts and the fair values of the Group’s financial assets and
financial liabilities at 30 March 2007 and 31 March 2006. 
2007 2007 2006 2006
Book value Fair value Book value Fair value
£m £m £m £m
Trade and other receivables 32.6 32.6 29.4 29.4
Short-term borrowings (13.0) (13.0) (63.2) (63.2)
Long-term borrowings (179.1) (179.1) (99.0) (99.0)
Finance leases (12.7) (12.7) (13.0) (13.0)
Other financial liabilities — current (115.1) (115.1) (103.1) (103.1)
Other financial liabilities — non-current (25.9) (25.9) (22.7) (22.7)
Cash at bank and in hand 24.8 24.8 1.5 1.5
Fair value assumptions
Short-term deposits and borrowings The fair value of short-term deposits, loans and overdrafts approximates to the carrying
amount because of the short maturity of these instruments.
Long-term borrowings The fair value of bank loans and other loans approximates to the carrying value reported in
the balance sheet as the majority are floating rate where payments are reset to market
rates at intervals of less than one year. 
19. EQUITY SHARE CAPITAL
2007 2007 2006 2006
Number of Number of
Ordinary shares of 1p each: shares £ shares £
Authorised 295,000,000 2,950,000 295,000,000 2,950,000
Allotted, called up and fully paid 219,046,537 2,190,465 228,027,743 2,280,277
Allotted, called up and fully paid share capital decreased during the period due to the Company’s £50m share repurchase programme.
During the period the Company acquired 9,003,956 shares at a cost of £30.0m. Distributable reserves have been reduced by £30.0m,
being the consideration paid for the shares. 
The Company’s share capital increased by 22,750 shares (2006: 91,000) due to the early exercising of share options by members of
the Halfords Share Option Scheme. Early exercise of the options are allowed if an option holder ceases to be employed by reason of
death, injury, disability, redundancy, retirement or on the sale of his employing company or business.
On 17 May 2007 the Company applied for block listing of a total of 6,000,000 ordinary shares of 1p each to be admitted on allotment
to the Official List of the UK Listing Authority and to trade on the London Stock Exchange market for listed securities. The shares will
be allotted under the Company’s CSOP and SAYE share schemes and when issued, will rank pari passu with the existing ordinary
shares of the Company.
Interest in own shares
At 30 March 2007 the Company held in Trust 877,498 (2006: 881,350) of its own shares with a nominal value of £8,774 (2006: £8,814).
The Trust has waived any entitlement to the receipt of dividends in respect of its holding of the Company’s ordinary shares. Notes to the Financial Statements
continued
60/61
Halfords Group plc Annual Report and Accounts 2007
20. SHARE-BASED PAYMENTS
At present the Group has three share award plans:
1. Halfords Company Share Option Scheme (“CSOP”)
2. Halfords Sharesave Scheme (“SAYE”)
3. The Long-Term Incentive Plan (“LTIP”)
1. The Halfords Company Share Option Scheme
The CSOP was introduced in June 2004. Options are granted with a fixed exercise price equal to the market price of the shares under
option at the date of grant. The contractual life of an option is 10 years.
The Company has made annual grants in 2004/05, 2005/06 and 2006/07. Options granted will become exercisable on the third
anniversary of the date of grant, subject to the achievement of a three-year performance condition. For grants up to 150% of basic
salary the options can only be exercised if the increase in earnings per share (“EPS”) over the period is not less than the increase in
the Retail Price Index (“RPI”) plus 6% for 2004/05 grants, 5% for 2005/06 grants and 3.5% for 2006/07 grants. In the case of grants in
excess of 150% of basic salary, the excess can only be exercised in full if the increase is not less than RPI plus 10% per year. For
increases in excess of 6% but less than 10% a proportion of the option in excess of 150% of salary can be exercised. Exercise of an
option is subject to continued employment. Grants in excess of 150% of salary have only been made under the 2004/05 scheme.
The expected volatility is based on historical volatility of a peer group of companies since the IPO in June 2004. The expected life is
the average expected period to exercise. The risk-free rate of return is the yield on zero-coupon UK government bonds.
Options were valued using the Black-Scholes option pricing models. No performance conditions were included in the fair value
calculations. The fair value per option granted and the assumptions used in the calculations were as follows:
Grant Date 6 July 2006 13 July 2005 2 June 2004
Share price at grant date £3.010 £2.955 £2.600
Exercise price £3.010 £2.955 £2.600
Number of employees 36 42 3,598
Shares under option 252,000 294,000 6,556,953
Vesting period (years) 333
Expected volatility 35% 37% 40%
Option life (years) 10 10 10
Expected life (years) 4.85 4.85 3.85
Risk-free rate 4.70% 4.68% 4.68%
Expected dividend yield 4.00% 4.00% 4.00%
Possibility of ceasing employment before vesting 32% 32% 34%
Expectations of meeting performance criteria 100% 100% 100%
Fair value per option £0.77 £0.79 £0.70
Number of options outstanding at 30 March 2007 252,000 259,000 4,709,030
2. Halfords Sharesave Scheme
The SAYE is open to all colleagues with eligible employment service. Options may be exercised under the scheme if the option holder
completes his saving contract for a period of three years and then not more than six months thereafter. Special provisions allow early
exercise in the case of death, injury, disability, redundancy, retirement or because the company or business which employs the option
holder is transferred out of the Group, or in the event of a change in control, reconstruction or winding up of the Company.
The fair value per option granted and the assumptions used in the calculations were as follows:
Grant Date 1 August 2006 11 August 2005 7 June 2004
Share price at grant date £3.01 £3.07 £2.64
Exercise price £3.01 £3.07 £2.64
Number of employees 343 573 1,561
Shares under option 173,558 269,037 1,364,861
Vesting period (years) 333
Expected volatility 22% 36% 39%
Option life (years) 333
Expected life (years) 3.5 3.5 3.5
Risk-free rate 4.75% 4.68% 4.68%
Expected dividend yield 4.10% 4.00% 4.00%
Possibility of ceasing employment before vesting 44% 53% 36%
Expectations of meeting performance criteria 100% 100% 100%
Fair value per option £0.44 £0.81 £0.65
Number of options outstanding at 30 March 2007 153,941 185,361 931,015 20. SHARE-BASED PAYMENTS continued
3. The Long-Term Incentive Plan
The introduction of a Long-Term Incentive Plan (‘LTIP’) was approved at the Annual General Meeting in August 2005 awarding the
executive directors and certain senior management conditional rights to receive shares.
To date two schemes have been approved for 2005/06 and 2006/07. The extent to which rights vest will depend upon the Group’s
performance over the subsequent three financial years.
The vesting of 50% of the awards will be determined by the Group’s relative total shareholder return (“TSR”) performance and the
vesting of the other 50% by the Group’s absolute earnings per share performance against RPI. The Group’s TSR performance will be
measured against the FTSE 350 general retailers as a comparator group. No retesting will be permitted. 
Options were valued using a Monte Carlo simulation option pricing model. The fair value per option granted and the assumptions used
in the calculation were as follows:
Grant Date 11 July 2006 8 August 2005
Share price at grant date £3.01 £3.07
Number of employees 18 17
Shares under option 596,908 537,417
Vesting period (years) 33
Expected volatility 22% 31%
Option life (years) 33
Expected life (years) 33
Risk-free rate 4.75% 4.30%
Expected dividend yield 4.25% 4.00%
Possibility of ceasing employment before vesting 30% 30%
Expectations of meeting performance criteria 100% 50%
Fair value per option £1.82 £2.19
Number of shares outstanding 30 March 2007 510,241 454,803
A reconciliation of option movements for the CSOP , SAYE and LTIP performance plans over the year to 30 March 2007 are 
shown below:
30 March 2007 31 March 2006
Weighted Weighted
Number average Number average
(’000) exercise price (’000) exercise price
Outstanding at start of year 7,819 2.67 7,067 2.61
Granted 1,029 3.01 1,100 3.04
Forfeited (171) 3.04 (7) 2.96
Exercised (28) 2.61 (85) 2.60
Lapsed (1,194) 2.64 (256) 2.67
Outstanding at end of year 7,455 2.71 7,819 2.67
Exercisable at end of year —— 3 2.60
30 March 2007 31 March 2006
Weighted Weighted
average Weighted average average Weighted average
exercise Number of remaining life (years) exercise Number of remaining life (years)
price shares Expected Contractual price shares Expected Contractual
£2.60 4,709 0.8 7.2 £2.60 5,739 2.0 8.2
£2.64 931 0.3 0.6 £2.65 1,022 1.6 1.6
£2.95 259 1.3 1.8 £2.95 287 4.2 9.3
£3.01 406 2.5 2.8 £3.01 — — —
£3.07 185 1.5 2.0 £3.07 233 3.0 3.0
£0.00 965 1.7 1.7 £0.00 538 2.0 2.0
The weighted average share price during the period for options exercised was £2.61 (2006: £2.60). The total charge for the year
relating to employee share-based payment plans was £2.1m (2006: £1.3m), all of which related to equity-settled share-based payment
transactions.  Notes to the Financial Statements
continued
62/63
Halfords Group plc Annual Report and Accounts 2007
21. COMMITMENTS
2007 2006
£m £m
Capital expenditure: contracted but not provided 2.8 1.3
The Group leases various stores, warehouses and equipment under non-cancellable operating leases. These leases have varying terms,
escalation clauses and renewal rights.
At 30 March 2007, the Group was committed to making payments in respect of these leases in the following periods:
Land and Other Land and Other 
buildings assets buildings assets
2007 2007 2006 2006
£m £m £m £m
Within one year 73.7 0.6 69.6 0.7
Later than one year and less than five years 288.8 0.5 274.6 0.9
After five years 446.0 — 449.5 —
808.5 1.1 793.7 1.6
The operating lease commitments are shown before receipts of sublet income.
22. PENSIONS
From 1 December 2002 employees have been offered membership of the Halfords Pension Plan, a defined contribution pension
arrangement. The costs of contributions to the scheme are charged to the income statement in the period that they arise. The
contributions to the scheme for the period amounted to £3.1m (2006: £3.3m) representing 3% of pensionable salaries for new
employees and 5% to 12% of pensionable salaries for employees who transferred from the Boots Group pension scheme, plus a
further 2% to 7% for employees whose earnings are above the upper earnings threshold.
23. CONTINGENT LIABILITIES 
The Group’s banking arrangements include the facility for the bank to provide a number of guarantees in respect of liabilities owed by
the Group during the course of its trading. In the event of any amount being immediately payable under the guarantees, the bank has
the right to recover the sum in full from the Group. The total amount of guarantees in place at 30 March 2007 amounted to £3.2m
(2006: £3.1m).
The Group’s banking arrangements are subject to a netting facility whereby credit balances may be offset against the indebtedness of
other Group companies.
24. POST-BALANCE SHEET EVENTS
On 21 March 2007, it was announced that the full rate of UK corporation tax will be reduced from 30% to 28% from April 2008. Once
this change is substantively enacted, when the Finance Bill has been approved, deferred tax assets and liabilities will be reassessed in
the year ending 28 March 2008 to reflect the lower tax rate.  Five Year Record
52 weeks to 53 weeks to 52 weeks to 52 weeks to 52 weeks to
28 March 2 April 1 April 31 March 30 March
2003 2004 2005 2006 2007
£m £m £m £m £m
UK GAAP UK GAAP IFRS IFRS IFRS
Revenue 525.8 578.6 628.4 681.7 744.0
Cost of sales (244.4) (271.6) (292.0) (335.0) (367.9)
Gross profit 281.4 307.0 336.4 346.7 376.1
Operating expenses (247.9) (244.1) (247.1) (257.6) (282.6)
Operating profit before exceptional items 
and goodwill amortisation 50.8 76.6 89.5 89.1 93.5
Goodwill amortisation (8.0) (13.7) — — —
Exceptional items (9.3) — (0.2) — —
Operating profit 33.5 62.9 89.3 89.1 93.5
Profit on sale of fixed assets — 6.4 — — —
Net finance costs (21.9) (44.1) (15.0) (12.1) (12.6)
Profit before tax 11.6 25.2 74.3 77.0 80.9
Tax (6.5) (14.3) (23.2) (23.4) (23.5)
Profit attributable to equity shareholders 5.1 10.9 51.1 53.6 57.4
Basic earnings per share n/a 6.7p 23.7p 23.6p 25.8p
Basic earnings per share before goodwill 
amortisation and exceptional items n/a 16.1p 23.7p 23.6p 26.6p
Halfords Group plc acquired Halfords Limited on 30 August 2002. Prior to this date Halfords Limited was a wholly owned subsidiary of
Boots Company plc and therefore prior to 30 August 2002, the financial information above is based on the financial statements of
Halfords Limited. In June 2004, Halfords Group plc listed on the London Stock Exchange. Consequently, the results across the periods
reflect the differences in the capital and financing structure under the different ownerships.
An analysis of the main differences between UK GAAP and IFRS are detailed in note 25 to the 2006 Annual Report and Accounts. Independent Auditors’ Report to the Members of Halfords Group plc
64/65
Halfords Group plc Annual Report and Accounts 2007
We have audited the Company financial statements of Halfords
Group plc for the 52 weeks to 30 March 2007 which comprise the
Company Balance Sheet and the related notes. These Company
financial statements have been prepared under the accounting
policies set out therein. We have also audited the information in
the Directors’ Remuneration Report that is described as having
been audited.
We have reported separately on the Group financial statements of
Halfords Group plc for the 52 weeks to 30 March 2007.
■■ RESPECTIVE RESPONSIBILITIES OF DIRECTORS 
AND AUDITORS
The directors’ responsibilities for preparing the Annual Report, the
Directors’ Remuneration Report and the Company financial
statements in accordance with applicable law and United
Kingdom Accounting Standards (United Kingdom Generally
Accepted Accounting Practice) are set out in the Statement of
Directors’ Responsibilities.
Our responsibility is to audit the Company financial statements
and the part of the Directors’ Remuneration Report to be audited
in accordance with relevant legal and regulatory requirements and
International Standards on Auditing (UK and Ireland). This report,
including the opinion, has been prepared for and only for the
Company’s members as a body in accordance with Section 235 of
the Companies Act 1985 and for no other purpose. We do not, in
giving this opinion, accept or assume responsibility for any other
purpose or to any other person to whom this report is shown or
into whose hands it may come save where expressly agreed by
our prior consent in writing.
We report to you our opinion as to whether the Company financial
statements give a true and fair view and whether the Company
financial statements and the part of the Directors’ Remuneration
Report to be audited have been properly prepared in accordance
with the Companies Act 1985. We also report to you whether in
our opinion the information given in the Directors’ Report is
consistent with the Company financial statements. The
information given in the Directors’ Report includes that specific
information presented in the Chief Executive’s Review and the
Finance Director’s Report that is cross-referenced from the
Business Review section of the Directors’ Report. In addition, we
report to you if, in our opinion, the Company has not kept proper
accounting records, if we have not received all the information and
explanations we require for our audit, or if information specified by
law regarding directors’ remuneration and other transactions is
not disclosed.
We read other information contained in the Annual Report and
consider whether it is consistent with the audited Company
financial statements. The other information comprises only the
Directors’ Report, the unaudited part of the Directors’
Remuneration Report, the Chairman’s Statement, the Chief
Executive’s Review, the Finance Director’s Report and the
Corporate Governance statement. We consider the implications
for our report if we become aware of any apparent misstatements
or material inconsistencies with the Company financial
statements. Our responsibilities do not extend to any other
information.
■■ BASIS OF AUDIT OPINION
We conducted our audit in accordance with International
Standards on Auditing (UK and Ireland) issued by the Auditing
Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the Company
financial statements and the part of the Directors’ Remuneration
Report to be audited. It also includes an assessment of the
significant estimates and judgements made by the directors in the
preparation of the Company financial statements, and of whether
the accounting policies are appropriate to the Company’s
circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the
information and explanations which we considered necessary in
order to provide us with sufficient evidence to give reasonable
assurance that the Company financial statements and the part of
the Directors’ Remuneration Report to be audited are free from
material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the
overall adequacy of the presentation of information in the
Company financial statements and the part of the Directors’
Remuneration Report to be audited.
■■ OPINION
In our opinion:
■ the Company financial statements give a true and fair view, in
accordance with United Kingdom Generally Accepted
Accounting Practice, of the state of the Company’s affairs as
at 30 March 2007;
■ the Company financial statements and the part of the
Directors’ Remuneration Report to be audited have been
properly prepared in accordance with the Companies Act
1985; and
■ the information given in the Directors’ Report is consistent
with the Company financial statements.
PricewaterhouseCoopers LLP, 
Chartered Accountants and Registered Auditors
Birmingham
6 June 2007
Parent Company Accounts Under UK GAAP Company Balance Sheet
Restated
As at As at  
30 March 31 March
2007 2006
Notes £m £m
Fixed assets
Investments 4 4.3 2.4
4.3 2.4
Current assets
Debtors falling due within one year 5 0.2 37.6
Debtors falling due after one year 5 201.6 149.3
Cash at bank and in hand 0.9 0.8
202.7 187.7
Creditors: amounts falling due within one year 6 (2.5) (2.2)
Net current assets 200.2 185.5
Net assets 204.5 187.9
Capital and reserves
Called up share capital 7 2.2 2.3
Share premium account 8 133.2 133.2
Capital redemption reserve 8 0.1 —
Profit and loss account 8 69.0 52.4
Equity shareholders’ funds 204.5 187.9
The notes on pages 67 to 69 are an integral part of these financial statements. 
The Company has elected to prepare its financial statements under UK GAAP . These policies are outlined on page 66.
The financial statements on pages 65 to 69 were approved by the Board of Directors on 6 June 2007 and were signed on its behalf by: 
Nick Wharton, Finance Director Ian McLeod, Chief Executive Accounting Policies
66/67
Halfords Group plc Annual Report and Accounts 2007
■■ BASIS OF PREPARATION
The accounts of the Company are prepared for the period up to the Friday closest to 31 March each year. Consequently, the financial
statements for the current period cover the 52 weeks to 30 March 2007, whilst the comparative period covered the 52 weeks to 
31 March 2006. The accounts are prepared under the historical cost convention, in accordance with the Companies Act 1985,
applicable accounting standards and specifically in accordance with the accounting policies set out below.
A consolidated cash flow statement has been included in the Halfords Group plc consolidated accounts. The Company has therefore
taken advantage of the exemption under FRS 1 (Revised 1996) “Cash flow statements” not to produce a cash flow statement. 
■■ PENSIONS
Employees are offered membership of Halfords Pension Plan, a defined contribution pension arrangement. The costs of the contribution
to the scheme are charged to the profit and loss account in the period that they arise.
■■ SHARE-BASED PAYMENTS
The Company operates a number of equity-settled, share-based compensation plans that are awarded to employees of the Company’s
subsidiaries.
In accordance with UITF Abstract 44 ‘FRS 20 (IFRS 2) — Group and treasury share transactions’ the fair value of the employee services
received under such schemes is recognised as an expense in the profit and loss account of the subsidiary that benefit from those
services received. The Company has recognised the fair value of the options as an increase to equity with a corresponding adjustment
to Investments. The impact of this change on the comparative period has been to increase investments by £2.3m with a corresponding
£0.1m decrease in amounts owed by Group undertakings and £2.2m increase in amounts owed to group undertakings. 
Fair value is determined by use of the Black-Scholes option pricing model for Options granted under the Halfords Company Share
Option Scheme and Share Save Scheme. Rights granted under the Company’s Long-Term Incentive Plan have been valued using the
Monte Carlo simulation option pricing model. 
The total fair value recognised is determined by reference to the fair value of share incentives, excluding the impact of any non-market
vesting conditions. Non-market vesting conditions are included in assumptions about the number of share incentives that are expected
to vest. At each balance sheet date, the Company revises its estimates of the number of share incentives that are expected to vest. The
impact of the revision of original estimates, if any, is recognised as an adjustment to equity, with a corresponding adjustment to
investments, over the remaining vesting period. 
■■ INVESTMENTS
Investments in subsidiary undertakings are stated at the original cost of the investments. Provision is made against cost where, in the
opinion of the directors, the value of the investments has been impaired.
■■ EQUITY DIVIDENDS
Final dividends are recognised in the Group’s financial statements in the period in which the dividends are approved by shareholders.
Interim equity dividends are recognised in the period they are paid. Notes to the Financial Statements
1. PROFIT AND LOSS ACCOUNT
The Company made a profit before dividends for the financial period of £74.2m (2006: £29.9m). The directors have taken advantage of
the exemption available under section 230 of the Companies Act 1985 and not presented a profit and loss account for the Company
alone.
2. AUDIT FEES
The total fees payable by the Company to PricewaterhouseCoopers LLP and their associates during the period were borne by
Halfords Limited. In the 52 weeks to 30 March 2007 and 31 March 2006 the Company did not expense any fees relating to
PricewaterhouseCoopers LLP .
3. EMPLOYEE BENEFIT EXPENSE
The Company has no employees other than the directors. Full details of the directors’ remuneration and interests are set out in the
Directors’ Remuneration Report on pages 30 to 35.
4. INVESTMENTS 
£m
Shares in Group undertaking
Cost
At 31 March 2006 0.1
Restatement for UITF 44 — share-based payments 2.3
As at 31 March 2006 — restated 2.4
Additions 0.1
Additions — share-based payments 1.9
Disposal (0.1)
At 30 March 2007 4.3
The investment represents shares in the following subsidiary undertaking as at 30 March 2007 and the recognition of share-based
compensation plans that are awarded to employees of the Company’s subsidiaries.
Ordinary shares
percentage 
Incorporated owned Principal
in % activities
Halfords Holdings (2006) Limited Great Britain* 100 Intermediate holding company
* Registered in England and Wales.
Halfords Holdings (2006) Limited was established on 7 June 2006 and was acquired by the Company on 27 June 2006. As part of a
reconstruction of the Group, on 11 July 2006 Halfords Holdings (2006) Limited issued shares to the Company in exchange for the
shares held in Halfords Holdings Limited.
In the opinion of the directors the value of the investment in the subsidiary undertaking is not less than the amount shown above.
Principal subsidiaries
The principal subsidiary undertakings of the Company at 30 March 2007 are as follows:
Principal activity % Ownership
Halfords Holdings (2006) Limited Intermediate holding company 100
Halfords Holdings Limited† Intermediate holding company 100
Halfords Finance Limited† Intermediate holding company 100
Halfords Limited† Retailing of auto, leisure and cycling products 100
† Indirect subsidiary undertakings.
All the above subsidiaries are incorporated in Great Britain and registered in England and Wales. All other subsidiary undertakings are
dormant and did not trade during the year. Notes to the Financial Statements
continued
68/69
Halfords Group plc Annual Report and Accounts 2007
5. DEBTORS
Restated
2007 2006
£m £m
Falling due within one year:
Amounts owed by Group undertakings 0.2 37.6
Falling due after more than one year:
Amounts owed by Group undertakings 201.6 149.3
Amounts owed by Group undertakings that fall due after one year are subject to interest. At 30 March 2007 the amounts bear interest
at a rate of 5.89% (2006: 5.22%). 
6. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Restated
2007 2006
£m £m
Amounts owed to Group undertakings (2.5) (2.2)
7. EQUITY SHARE CAPITAL
2007 2007 2006 2006
Number of Number of
Ordinary shares of 1p each: shares £ shares £
Authorised 295,000,000 2,950,000 295,000,000 2,950,000
Allotted, called up and fully paid 219,046,537 2,190,465 228,027,743 2,280,277
Allotted, called up and fully paid share capital decreased during the period due to the Company’s £50m share purchase programme.
During the period the Company acquired 9.0m shares at a cost of £30.0m. Distributable reserves have been reduced by £29.9m, being
the consideration paid for the shares. 
The Company’s share capital increased by 22,750 shares (2006: 91,000) due to the early exercising of share options by members of
the Halfords Share Option Scheme. Early exercise of the options are allowed if an option holder ceases to be employed by reason of
death, injury, disability, redundancy, retirement or on the sale of his employing company or business.
Potential issue of ordinary shares
The Company has three employee share option schemes. Further information regarding these schemes can be found in note 20 of the
Group financial statements.
Interest in own shares
At 30 March 2007 the Company held in Trust 877,498 (2006: 881,350) own shares with a nominal value of £8,774 (2006: £8,814). The
Trust has waived any entitlement to the receipt of dividends in respect of its holding of the Company’s ordinary shares.
8. RESERVES
Share Capital Profit
premium redemption and loss
account reserve account Total
£m £m £m £m
At 31 March 2006 133.2 — 52.4 185.6
Profit for the financial period — — 74.2 74.2
Purchase of own shares — 0.1 (30.0) (29.9)
Employee share options — — 1.9 1.9
Dividends ——(29.5)(29.5)
At 30 March 2007 133.2 0.1 69.0 202.3
The Company settled dividends of £29.5m in the period, as detailed in note 7 of the Group financial statements.  9. RELATED PARTY DISCLOSURES
Under FRS 8 “Related party disclosures” the Company is exempt from disclosing related party transactions with entities over which it
has 90% control or more.
10. CONTINGENT LIABILITIES 
The Group’s banking arrangements include the facility for the bank to provide a number of guarantees in respect of liabilities owed by
the Group during the course of its trading. In the event of any amount being immediately payable under the guarantees, the bank has
the right to recover the sum in full from the Group. The total amount of guarantees in place at 30 March 2007 amounted to £3.2m 
(2006: £3.1m).
The Company’s banking arrangements are subject to a netting facility whereby credit balances may be offset against the indebtedness
of other Group companies. Shareholder Information
70/71
Halfords Group plc Annual Report and Accounts 2007
■■ ANALYSIS OF SHAREHOLDERS
As at 30 March 2007, the number of registered shareholders was 1,975 and the number of ordinary shares in issue was 220,577,287.*
Number of % of total Number of % of issued
holdings shareholders shares share capital
Range of holdings
1–5,000 1,517 76.8 2,182,007 1.0
5,001–10,000 98 5.0 735,468 0.3
10,001–50,000 155 7.8 3,715,648 1.7
50,001–100,000 37 1.9 2,660,355 1.2
100,001–500,000 89 4.5 23,109,291 10.5
500,001 and above 79 4.0 188,174,518 85.3
Total 1,975 100.0 220,577,287 100.0
Held by
Individuals 868 43.9 1,973,011 0.9
Institutions 1,107 56.1 218,604,276 99.1
Total 1,975 100.0 220,577,287 100.0
* The data above does not take into account shares awaiting cancellation, as part of the share buy-back programme.
■■ RESULTS AND FINANCIAL DIARY
Annual General Meeting: 25 July 2007
Final dividend payable: 1 August 2007
Pre-Close Statement: 4 October 2007
Half Year Report: 22 November 2007
Ex dividend date: 28 November 2007
Record date: 30 November 2007
Interim dividend payable: 9 January 2008
■■ ANNUAL GENERAL MEETING
The Annual General Meeting will be held at 12.30 pm on Wednesday 25 July 2007 at the Alveston Manor Hotel, Clopton Bridge,
Stratford-upon-Avon, Warwickshire, CV37 7HP .
Each shareholder is entitled to attend and vote at the meeting.
■■ DIVIDEND PAYMENTS
The proposed final dividend (if approved) will be paid on 1 August 2007 to shareholders on the register on 29 June 2007.
■■ PAYMENT OF DIVIDENDS BY BACS
Many shareholders have already arranged for dividends to be paid by mandate directly to their bank or building society account. The
Company mandates dividends through the BACS (‘Bankers’ Automated Clearing Services’) system. The benefit to shareholders of the
BACS payment method is that the Registrar posts the tax vouchers directly to them, whilst the dividend is credited on the payment date
to the shareholder’s bank or building society account. Shareholders who have not yet arranged for their dividends to be paid direct to
their bank or building society account and wish to benefit from this service should complete the mandate form attached to their
dividend tax voucher or, alternatively, request the Company’s Registrar (address below) to send them a dividend mandate form.
■■ DIVIDEND REINVESTMENT PLAN 
The Company offers a dividend reinvestment plan that gives shareholders the opportunity to use their cash dividend to buy Halfords
Group plc ordinary shares. The plan is run by Capita Registrars (“Capita”). For further information on the plan and how to join please
contact Capita at Northern House, Woodsome Park, Fenay Bridge, Huddersfield, West Yorkshire, HD8 0LA (tel: 01484 600904) or the
Company Secretary.
■■ SHAREHOLDER INFORMATION ON THE INTERNET
The Company maintains an investor relations section on its website (www.halfordscompany.com) which allows access to share price
information, management biographies, copies of Company reports and other useful investor information.
Halfords Group plc is registered in England and Wales (Number 4457314).
A copy of this Annual Report is being sent to all shareholders. Copies are also available from the registered office shown below. The
Report is also placed on the investor relations section of the Company’s website, www.halfordscompany.com. Shareholder Notes Shareholder Notes
72
Halfords Group plc Annual Report and Accounts 2007 ■■ REGISTERED AND HEAD OFFICE
Halfords Group plc
Icknield Street Drive
Redditch
Worcestershire
B98 0DE
Company no. 04457314
Registered in England and Wales
■■ REGISTRARS
Capita IRG Plc
Northern House
Woodsome Park
Fenay Bridge
Huddersfield
West Yorkshire
HD8 0LA
■■ AUDITORS
PricewaterhouseCoopers LLP
Cornwall Court
19 Cornwall Street
Birmingham
B3 2DT
Company Information
■■ INTERNAL AUDITORS
Deloitte & Touche LLP
180 Strand
London
WC2R 1BL
■■ JOINT BROKERS
Merrill Lynch International
2 King Edward Street 
London 
EC1A 1HQ
Citigroup 
33 Canada Square
London 
E14 5LB
■■ SOLICITORS
Clifford Chance LLP
10 Upper Bank Street
London 
E14 5JJ extra mile
we go the
www.halfordscompany.com
www.halfords.com
Halfords Group plc Annual Report 2007