Bicycle fever and increasingly- affordable satellite-navigation systems have prompted Halfords to stick by its full-year targets, despite seeing sales slow down over the past six months.

Halfords, which has 397 stores and employs more than 9,000 staff, said like-for-like sales are expected to have risen by 8.9 per cent over the year to April 1, while bicycle sales appeared to be at record levels for the company, which was founded in 1892.

It also benefited from a drop in prices of in-car navigation systems from £2,000 around 18 months ago to £300 currently, it added.

But the recent slowdown in the retail sector appeared to have taken its toll. The Redditch-based group had seen sales improve by 10.6 per cent in the first half of its financial year.

Despite the recent sales dip, Halfords said it still remained on target to meet its own expectations and reassured investors that shoppers were continuing to spend more money on all its major product lines.

Total sales rose 8.6 per cent over the past year and underlying sales, which exclude stores where a mezzanine has been added, were up by 8.2 per cent.

In a trading statement, bosses said they remained "confident about the growth prospects for Halfords as the group continues to develop its store and product portfolio".

The update was the first delivered by former Celtic football club boss Ian McLeod since he took over as chief executive from David Hamid last month.

Mr McLeod, who joined Halfords in September 2003 as chief operating officer, was elevated to the top role when 53-year-old Mr Hamid retired due to ill health.

He said the sales slowdown was not unexpected as the company faced tough comparisons with the previous year.

Mr McLeod ruled out any material change in the strategic direction now that he has taken up the reins of the business, vowing to press ahead with existing expansion plans.

This includes investing in stores on the high street, developing its out-of-town presence and also opening smaller "footprint" outlets in market towns that have previously been ignored by the group, he said.

The company's stock has risen almost 17 per cent since it was floated in June at 260 pence per share.

Private equity-house CVC bought Halfords from Boots for £427 million in 2002. It sold half its stake in the firm in December.

Analysts expect the group to post pretax profits of around £77 million when it unveils its full-year results in June.

Halfords shares closed at 300p up 31/2p.