Pets at Home Revenue Slips, But Guidance Remains Unchanged

Pets at Home, the UK's leading pet care retailer, has reported a marginal fall in its third-quarter revenue, but the company remains confident in its full-year guidance. The group's revenue for the 12-week period to January 2 fell by 0.2% to £361.6 million, with retail sales declining by 2.4% and like-for-like sales dropping by 2.8%. However, the company's vet revenues jumped by 21.3%, partially offsetting the decline in retail sales.



The decline in retail sales can be attributed to a challenging consumer environment, particularly weak footfall from October onwards, which hit the entire retail sector. The group highlighted "particularly weak" footfall during this period, leading to a 2.4% decline in sales at its shops and a 2.8% like-for-like dip. Additionally, a weaker performance across accessories such as beds, collars, and leads contributed to the overall revenue decline.

Despite the challenging backdrop, Pets at Home has maintained a disciplined gross margin performance, supported by strong Christmas seasonal sell-through and effective cost management. The company's vet group has also delivered differentiated performance, growing visits and attracting new customers, driven by its passionate, independent practice owners.

Looking ahead, Pets at Home remains on track to deliver modest growth in underlying pre-tax profit this year, as set out at its H1 results. The company has invested in its logistics, stores, and digital platforms to improve efficiency and customer experience, which should help drive retail sales growth in the future. Additionally, the company's unique joint venture vets have continued to deliver differentiated performance, growing visits and attracting new customers.

In conclusion, while Pets at Home has faced a challenging consumer environment and experienced a decline in retail sales, the company's vet group has performed strongly, and its full-year guidance remains unchanged. By continuing to invest in its logistics, stores, and digital platforms, and leveraging the strength of its vet group, Pets at Home is well-positioned to navigate the current market conditions and deliver growth in the future.