The car parts to bicycles chain said like-for-like bike sales rose 1.9% in its fourth quarter to 1 April, marking its second quarter of growth in a row.
But a dire performance last summer left like-for-like bike sales 0.9% lower over the full year.
Halfords is still expecting to meet its full-year pre-tax profits expectations for between £78m and £82m thanks to robust trading in its car maintenance arm.
The group, which runs 463 Halfords stores, posted a pre-tax profit of £81.1m last year.
Shares leaped 8% higher on the strong fourth quarter trading.
Recently-hired boss Jill McDonald is spearheading a new turnaround plan to get the retailer's performance back on track, including a renewed push in the bike sector, with Olympian and Tour de France champion Sir Bradley Wiggins signed up to launch a new children's range.
Sir Bradley will help design eight bikes as part of his drive to get more children into cycling, with the range due to hit stores in July.
The group is also being boosted by impressive trading at its Autocentre garages, which saw like-for-like sales jump 2.5% higher over the year and up 1.7% in the fourth quarter.
Its travel arm, which sells products such as camping furniture , also saw a strong sales hike, up 9.5% on a like-for-like basis in the fourth quarter.
Analysts at Liberum said: "We see a strong fourth quarter as encouraging, although one quarter does not make a trend and we need to see further momentum before turning more positive."
Halfords posted a 5.9% fall in half-year underlying profits to £46.4m after the bike woes last summer, when sales dropped 7.6% on a like-for-like basis in the group's second quarter and down by 11% between mid-July and mid-August - traditionally its peak selling season.
It was hit by poor weather and high promotional activity, while the sales fall was also compounded by tough comparisons from a year earlier.
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