Pets at Home records a slight increase in revenue despite challenges.
- The Vet Group sees a significant 18.6% growth, boosting overall performance.
- Retail division shows minimal growth with flat like-for-like sales.
- Profit before tax rises by 14.1%, yet future growth expectations are cut.
- Impacts of government policies and market conditions are anticipated.
In a market marked by sluggishness, Pets at Home has managed to achieve a small revenue increase. The total group revenue rose by 1.9% to £789.1 million, with a like-for-like basis increase of 1.6% for the first half of FY25. CEO Lyssa McGowan described the market conditions as ‘subdued’,’ underlining the challenges faced by the retail sector.
The company’s Vet Group, however, has served as a beacon of growth, recording an impressive 18.6% increase in revenue over the 28 weeks leading up to October. This growth was attributed to a rise in subscriptions, higher average transaction values, and increased frequency of visits. Such performance highlights the group’s strong position, even as other areas remain stagnant.
On the retail front, slight progress was recorded with only a 0.1% growth. Like-for-like sales failed to increase, indicating a challenging retail climate. Despite these hurdles, the business reported a notable rise in underlying profit before tax, which achieved a 14.1% uplift, equivalent to a 47.3% increase to £51.1 million on a statutory basis.
The company expressed concerns over future costs due to changes in the minimum wage and National Insurance, which could lead to an additional £18 million expense in the next financial year. It aims to counter these increases via productivity programs and investments in automation.
The retailer’s forward-looking strategy revolves around boosting its digital platform and expanding its store network, alongside leveraging its Stafford distribution centre’s capabilities. Yet, the current outlook remains cautious as Pets at Home has revised its profit growth expectations downwards for the remainder of FY25, anticipating the persistence of present market conditions. CEO McGowan remained optimistic about long-term growth, citing structural growth trends as a solid foundation for future gains.
Despite current market challenges, Pets at Home remains focused on strategic investments, confident in long-term growth opportunities.
