Pets At Home sees profits leap as record sales offset rising costs

Retailer Pets At Home has posted better-than-expected annual profits as record sales helped offset soaring energy costs and higher investment spend.

The group reported underlying pre-tax profits of £136.4 million for the year to March 30, up 4.8% or 8% higher on a 52-week basis as the boom in pet ownership seen since the pandemic started helped sales jump 6.6% to £1.4 billion.

Like-for-like sales jumped 13.4% across its Vet Group chain, while retail revenues lifted 7.5%.

The profits leap came despite energy costs soaring by £14.9 million and a £5.9 million spend on digital investment.

On a reported basis, pre-tax profits fell 17.7% to £122.5 million after last year’s figures were boosted by gains from the sale of its specialist group business, as well as costs of its new Stafford warehouse.

Chief executive Lyssa McGowan unveiled plans alongside the results to “build the world’s best pet care platform”, with aims for an all-in-one pet care app, offering services including allowing customers to book surgical veterinary appointments, order repeat prescription deliveries and manage nutrition subscriptions.

Her growth plans also include targeting growth of 10% for pre-tax profits and 7% for sales each year.

But costs of investment are set to hold back profits growth over the year ahead, with the group sticking by guidance for underlying pre-tax profits of around £136 million in 2023-24.

It is set to take another £15 million in costs from its switch to the new warehouse.