Pets at Home's profits edge up as demand for vet services surges
Pets at Home saw underlying pre-tax profits across its veterinary arm rise by 23.3 per cent year-on-year to £75.9million, preliminary results show.
But, across the chain's retail arm, underlying pre-tax profits slipped 16.6 per cent year-on-year to £72.9million.
Revenue from vet services swelled by 13 per cent year-on-year, to £655.1million, comprising a third of total revenue at the business.
Revenue from retail sales fell 1.8 per cent year-on-year to £1.3billion, Pets at Home said.
Pets at Home has struggled with sluggish retail sales for the last few years, which it has previously attributed to weak footfall and a 'challenging UK consumer backdrop'.
Across all its operations, the company reported an underlying pre-tax profit of £133million for the year ending 27 March, up from £132million the previous year.
On retail sales, the group said the business was 'impacted by a period of subdued growth in the pet sector due to a soft UK consumer backdrop throughout FY25, deflation and normalising levels of new pet ownership.'
Overall statutory revenue edged up 0.1 per cent to £1.48billion in the year to 27 March.
The group said it had 8.2million members signed up to its loyalty scheme by the end of the period.
On vet practice expansion, the group said: 'In FY26 we plan to open at least 10 new JV practices alongside 15 extensions.'
Pets at Home increased its dividend for shareholders by 1.6 per cent year-on-year, from 12.8p to 13p.
Pets at Home shares fell 0.38 per cent or 1.00p to 261.40p on Wednesday, having fallen over 7 per cent in the last year.
Chief executive Lyssa McGowan, said: 'The past two years have seen a profound transformation at Pets at Home.
'We have moved from a business with a strong presence in pet retail and vets, to a true pet care platform.'
She added: 'In FY25, we also saw another outstanding year of growth in our vets business, fuelled by the commitment and expertise of our partners, supported by our best-in-class scale services, platform benefits and industry knowhow.
'Our practices significantly outperformed a more subdued industry backdrop and delivered this progress despite the ongoing uncertainty of the CMA investigation – further demonstration of the power of our unique joint venture model.'
The Competition and Markets Authority has been investigating the veterinary sector and is probing whether a lack of competition in the industry has contributed to surging prices.
Across businesses in the sector, prices for treatments grew by 60 per cent between 2015 and 2023, compared with inflation of 35 per cent for other general services, according to CMA research.
The CMA is pushing for more transparency over pricing as part of the overhaul due to be finalised in the coming months.
In addition to the price caps, the CMA is examining whether a ban on bonuses linked to offering specific treatments would be viable.
Adam Vettese, a market analyst at eToro, said: 'Pets at Home are putting their best paw forward with the veterinary side of the business, which is continuing to show robust growth.
'This has helped offset weaker retail performance and brought overall results in line with market expectations. Pre-tax profit and earnings per share rose, reflecting operational resilience despite a challenging macro environment.
'The board's confidence is evident in the 1.6 per cent dividend hike to 13.0p, signalling optimism for long-term growth.
'However, headwinds persist. Elevated costs, softer retail footfall, and the ongoing CMA probe into veterinary pricing practices continue to cloud the outlook.'
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