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16 Aug 2022

Pandemic pet boom keeps sales growing for Pets At Home

Pandemic pet boom keeps sales growing for Pets At Home

Pets At Home has seen its first-quarter revenues boosted as it continues to profit from the pandemic pet boom.

The pet supplier said its total revenue grew 7.1% to £404.7 million in the 16 weeks to July 21, while revenue for its vet arm increased by 11%.

The company acquired 1.1 million new customers last year as the lockdown-driven boom in pet ownership created new opportunities for animal retailers.

Sign-ups to its puppy and kitten club – a subscription service for pet owners – averaged 25,000 a week, three times higher than before Covid, the retailer said.

It also reported a record number of loyalty club members, growing 10.7% year-on-year to total 7.4 million people paying for the service.

In May, the group’s outgoing chief executive said cash-strapped households would rather cut back on eating out and buying a new car before spending less on their beloved pets.

It came as the company reported record annual profits, surging 65.3% compared to the previous year.

Steep cost inflation has impacted the business in recent months with rising prices of raw materials and huge surges in energy costs.

But it plans to manage cost pressures by reducing costs and improving operational efficiencies and therefore avoiding price rises for customers, bosses said.

Lyssa McGowan, Pets At Home’s chief executive, said: “Our performance has remained strong in the first quarter, underpinned by continued customer growth and high levels of retention.”

Pets At Home ended the quarter with £40.2 million in net cash and said its full-year profit outlook of £131 million remained unchanged.

Matt Britzman, an equity analyst at Hargreaves Lansdown, commented: “The pandemic fuelled pet ownership craze was a blessing for Pets At Home and those cats and dogs will need looking after long into the future.

“What’s very interesting with Pets At Home is its hybrid approach, omni-channel revenue continues to grow and was the standout this quarter.

“That’s testament to a lot of work that’s gone into boosting the online offering, with services like click and collect meaning customer journeys are a mix of online and in-store.”

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