Pets at Home reports a modest revenue increase despite challenging market conditions, prompting a revision of profit expectations.
- The company’s Vet Group stands out, achieving an 18.6% revenue rise due to increased customer engagement.
- Retail division sees modest growth with a stable like-for-like sales performance.
- Pets at Home anticipates continued subdued market conditions, affecting profit projections.
- Strategic investments continue as the company adapts to wage and insurance policy changes.
Pets at Home has reported a 1.9% increase in total group revenue, reaching £789.1 million for the first half of fiscal year 2025. Despite operating in what it describes as a “subdued” retail market, the company’s performance showcases resilience, particularly through its Vet Group. This sector experienced significant growth, with revenues climbing by 18.6%. Such success has been driven by increased customer subscriptions, higher transaction values, and more frequent visits.
In contrast, the retail division posted a modest growth of just 0.1%, maintaining its like-for-like sales on a stable level. The company achieved a 14.1% increase in underlying profit before tax, amounting to £54.5 million, while statutory profit before tax soared by 47.3% to reach £51.1 million. CEO Lyssa McGowan emphasized that their differentiated joint venture model within the Vet Group continues to drive outstanding results, outpacing their competitors. She highlighted that customer satisfaction and competitive pricing in their retail operations remain robust, coupled with stringent cost management.
Looking forward, the company cautioned about the potential financial impact of recent government announcements regarding minimum wage and National Insurance adjustments, which are expected to increase costs by £18 million in the upcoming financial year. Pets at Home plans to counter these with productivity programs and investments in automation.
The company’s active member base has grown by 3% to 8.1 million, following a successful relaunch of its digital platform. This growth supports the solid performance of the Vet Group, which continues to register 18,000 new pet sign-ups weekly. Despite facing an ongoing subdued market, the company has revised its profit growth expectations downward, anticipating these conditions to persist throughout the remainder of FY25.
CEO McGowan expressed confidence in the long-term market improvements, pointing to established trends as a basis for growth. She affirmed that strategic investments in their digital platform, store network expansion, and the Stafford distribution center position the company to deliver attractive returns to shareholders moving forward.
Pets at Home remains optimistic about future growth, leveraging strategic investments despite current market challenges.
