Vet Business Growth Offsets Retail Decline and Digital Improvement

  • Pets at Home maintains full-year profit guidance despite a 0.2% drop in total group revenue
  • Consumer revenue increased by 2.3% to £468m, driven by vet business growth
  • Retail revenue dropped 2.4%, but digital performance improved with strong growth in subscriptions
  • Network optimisation includes exiting Northampton DC by the end of financial year
  • Transition to Stafford distribution centre leads to non-underlying costs increase from £7m to £11m in FY25

Pets at Home has managed to maintain its full-year profit guidance despite a slight drop in total group revenue to £361.6m for the 12 weeks ended January 2025, with consumer revenue increasing by 2.3% to £468m. The company attributes this success to strong growth within its vet group, which saw a 21.3% increase in revenue and a 19.9% rise on a like-for-like (LFL) basis. This growth was driven by high-quality expansion in subscriptions, visits, and average transaction values. However, the retail business experienced a 2.4% drop in revenue and a 2.8% decline LFL, mainly due to weak footfall in October. The digital performance improved throughout the quarter, building momentum through strong growth in subscriptions. Pets at Home expects its underlying profit before tax (PBT) for FY25 to grow ‘modestly’ compared to last year, thanks to disciplined gross margin management and effective cost control. Additionally, the company revealed plans to exit its Northampton distribution center (DC) by the end of the financial year as part of network optimization efforts, leading to a non-underlying cost increase from £7m to £11m in FY25.

Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about Pets at Home’s financial performance, including revenue figures, growth within its vet group, and plans for its distribution centers. It also includes quotes from the company itself regarding its expectations for future profitability.
Noise Level: 3
Noise Justification: The article provides relevant information about Pets at Home’s financial performance and specific details on its revenue growth and cost management. However, it lacks analysis or exploration of long-term trends or consequences for stakeholders.
Financial Relevance: Yes
Financial Markets Impacted: No
Financial Rating Justification: The article discusses Pets at Home’s financial performance, including revenue and profit guidance, as well as its cost management and distribution center transition. However, it does not directly mention any specific impact on financial markets or companies.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no mention of an extreme event in this article.

Reported publicly: www.retailsector.co.uk