Pets at Home reveals strong first half

Pets At Home reveals strong first half
Pets at Home posts encouraging first half results.
// Pets at Home says retail revenue up 7.8 per cent for H1
// Retailer hails “sustained momentum” across business
// Pets at Home achieves 11 consecutive quarters of growth

Pet specialist retailer Pets at Home said it is “on track” to deliver a full year of profit growth this morning, after revealing like-for-like retail revenue up 7.8 per cent.

In the 28 weeks to October 10 Pets at Home noted “sustained momentum” in its retail business, with omnichannel revenues up 31.7 per cent to £46.5 million.

READ MORE: Pets at Home: profit guidance raised after encouraging quarter

Retail sales grew 8.1 per cent in the first half, with Pets At Home pointing out it has achieved 11 consecutive quarters of growth.

Group revenue rose 9.4 per cent year-on-year, up 7.6 per cent like-for-like to £546.3 million.

The business said it was “bucking the retail trend” by receiving a record number of consumer transactions.

While the pet market is growing, Pets at Home said its business was outpacing the sector thanks to its wider range of services, including dog grooming.

In its first half the retailer groomed more than 460,000 dogs, equating to more than 2,350 a day.

“We have executed our plans well, and this has been reflected in the strong customer sales growth across the group,” said chief executive Peter Pritchard.

“We have seen sustained momentum in retail, with a 2-year like-for-like of 13 per cent. This has been complemented by a meticulous delivery of our Vet Group recalibration. The programme to buy out a number of joint venture practices is already complete, whilst changes we have made to the fee arrangements for ongoing practices are already showing signs of positive progress and will be followed by further planned adjustments in the second half of the year.

“All this provides a strong foundation, meaning we have much to look forward to in FY20 and beyond, and we now expect to return to profit growth a year ahead of our original plan,” Pritchard added.

Looking ahead, Pritchard said the business now expects full year group underlying free cashflow to be broadly flat, despite the previously disclosed one-off outflow of £10.7 million relating to a change in timing to Corporation Tax payments.

Pets at Home will open five new stores in the second half of its financial year, as well as grooming salons and vet practices.

The retailer said its focus “remains on sustaining the return to profit growth and we expect to generate further underlying profit and free cashflow growth from FY21, despite the potential headwind posed to retail gross margin by USD currency movements”.

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