Pets at Home HY profit falls amid elevated costs
By Scott Kanowsky
Investing.com -- Pets at Home Group PLC (LON:PETSP) posted a decline in half-year pre-tax income, as an inflation-fuelled rise in expenses offset resilient customer demand at the British pet supplies retailer.
Group underlying profit before tax in the 28 weeks to October 13 fell by 9.3% compared to the same period last year to £59.2 million, which the Handforth-based company said was due to increased freight and energy costs, as well as an annual uptick in spending on its key digital business.
"The inflationary environment creates pressures for both our customers and the business," Pets at Home said in a statement. "We are conscious of the challenges faced by many consumers, and continue to prioritize making pet care as convenient and affordable as possible."
Revenue growth came in at 7.3%, buoyed by "record" customer levels, in a sign that U.K. consumers may be shrugging off cost-of-living concerns to pay for the necessities for their furry charges.
Omnichannel sales, which include both in-store and online revenue, surged by 16.2% in the first half. The number of active VIP shoppers - or customers with loyalty cards that offer discounts - also jumped by 9% annually.
Vet group sales expanded by 13.1% on a like-for-like basis in the second quarter, adding on to gains seen in the prior period. Chief executive officer Lyssa McGowan has previously said this increase in demand for vet services is linked to a change in lifestyles for pet owners following COVID-19 lockdowns.
Meanwhile, the firm backed its full-year guidance for underlying pre-tax income of £131M.
Shares in Pets at Home fell in early trading on Wednesday.
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