Pets at Home boss remains upbeat despite pre-tax profits taking a hit.
The Cheshire-headquartered retailer saw pre-tax profits slump 37.7 per cent year on year to £49.6m in the 12 months to the end of March as it ringfenced £40.4m to fund more buyouts of joint ventures with vet practices in the retailer’s latest financial year.
However, underlying profit rose 6.1 per cent to £89.7m and revenues rose 6.9 per cent to £961m.
Pets at Home chief executive Peter Pritchard said the business was “trading strongly and taking share across the pet market”.
He said: “Customers are loving our lower prices, the convenience of subscription packages, high quality veterinary care and pet healthplans.
“We launched our pet care strategy last year and we’re already making good progress, bringing our Retail and Vet businesses closer together.
“Our commitment is to make sure pets and their owners get the very best advice, care and products, and we’re able to join this up for customers in a way that competitors just can’t.
“I’m pleased with our progress and the results we have delivered, but there remains plenty to do. I’m confident we will successfully reposition our Vet Group so that, with the strong performance in Retail, we will be well placed to deliver our strategy.”
Russ Mould, investment director at AJ Bell, said today’s results are a step in the right direction, ‘but there is more to do to earn the market’s full approval.’
He added: “In reality the company has been all over the place since it was let off the leash at its IPO in 2014 – the substantial borrowings which it carried from the outset didn’t help – and they are still tagged some way below the 245p they floated at.
“Pets at Home is not alone in having spotted the potential in this space and it has faced competitive threats from online players and discount supermarkets.
“The firm’s joint venture vet practices also aren’t expected to be profitable for a number of years and a shortage of veterinary practitioners is pushing up vet salaries.
“Today’s results are a step in the right direction, but there is more to do to earn the market’s full approval.”
