Pets at Home ‘not threatened’ by regulator probe as it holds firm on growth plans
Animal care retailer Pets At Home has held its guidance for the year and said its vet growth strategy is “not threatened” by the CMA’s review into the sector.
It comes just days after the competitions watchdog confirmed it would press ahead with an investigation into the UK’s vet industry following concerns pet owners are not getting value for money.
Pets at Home, which has 400 surgeries across the UK, will be one of the companies examined by the body.
They said: “Our unique practice owner model has driven record growth and consistent market outperformance, with consumer revenues now £576m, acting as a material contributor to the overall group.”
“As more practices reach maturity it unlocks opportunities to drive additional growth through advanced capabilities, practice extensions, and the rollout of 5-15 new practices a year.”
On Friday the company said it would “continue to fully cooperate with the CMA to ensure our unique and pro-competitive business model of locally-owned vet practices is fully understood”.
Its update for the year to March revealed a 13.7 per cent decline in statutory profit before tax to £105.7m, with the group blaming its office consolidation for the dip.
Total group revenue growth of 5.2 per cent to £1.5bn, while vet group revenue grew 16.8 per cent and retail revenue was up four per cent.
Pets at Home also confirmed a £25m share buyback announced for FY25, having completed £100m in buybacks over the last two years.
Shares in the firm rose by over three per cent in early trade .
Lyssa McGowan, chief executive officer, at Pets at Home, said: “Our medium-term strategy and financial framework is unchanged and, looking ahead, the fundamental strengths of the business position us well to deliver growth.
“We hold a leading position in a structurally growing market, with an unrivalled retail store network, and a unique, differentiated and integrated vet business. We know the nation’s pets better than anyone else, with over 10 years of analytical data on 10 million pets, and we now have a best-in-class digital platform, and a modern efficient DC.”
Dan Coatsworth, investment analyst at AJ Bell, said: “Shares in Pets at Home, which have been buffeted by weakening demand and a CMA probe into the vet industry, were steady following the company’s full-year results.
“Profit fell, as expected, but more significantly the company stuck with guidance for what CEO Lyssa McGowan has described as a ‘pivotal year’ ahead as the company launches a new digital platform.”
He added: “It’s no secret that Britons love their pets but while people might still buy the basics, demand for all the little extras like toys and treats, which are lucrative sales for Pets at Home, has waned.
“By offering everything under one roof, including grooming and veterinary services, Pets at Home hopes to drive loyalty and bat off the competitive threat from non-specialists like the supermarkets.”