Pets at Home ‘optimistic’ as sales rise in H1

Pets at Home has announced that group revenue grew by 5.1% to £574.4m in the half-year ended 8 October 2020, noting that the underlying pet care market remains “in good health” despite the pandemic.

While the group saw pre-tax profit fall by 5.1% to £39.6m in the period, down from £41.7m the prior year, recovery was seen in the second quarter, where a pre-tax profit growth of 43.7% was reported. 

The essential retailer said there was “much to be optimistic about” as like-for-like revenue rose by 5.3% in the period, with revenue up by 12.7% in the second quarter. 

Retail like-for-like sales grew by 5.8%, while its omnichannel revenue growth soared by 65.8% as more shoppers made online purchases. Online sales now account for 15.2% of revenue sales, up from 10% the prior year. 

It comes as the group said that pet ownership has increased during the pandemic, adding that lockdown has “accentuated our emotional bond with pets as they play a more significant role in our daily lives”.

The “sustained strength” in its retail performance during Q2 has continued into the third quarter, according to the group, and it “continues to take market share across all channels”. 

Looking ahead, Pets at Home said the pandemic continues to create a number of “material uncertainties” around the near-term trading environment, including a reversion to a tiered system of localised restrictions.

The group now anticipates full-year underlying pre-tax profit to be in line with the prior year, with the estimated financial impact of the pandemic not fully offset by this year’s business rates relief. 

CEO Peter Pritchard said: “In spite of the ongoing and wide-ranging impact of COVID-19, there is much to be optimistic about. The market in which we operate remains resilient, with recent changes to our work and leisure patterns supporting rising levels of pet ownership, a good proxy for future growth in both the underlying market and our business. 

“We adapted our operations rapidly post the onset of the pandemic, and our focus on customer acquisition is underpinning market share gains across all channels and strong growth in our VIP and Puppy and Kitten clubs, thereby increasing the long-term opportunity of using data-driven, joined-up solutions across our range of products and services to drive customer share of wallet and lifetime value.” 

He added: “We are introducing new ways to meet our customers’ needs across all channels, making pet care as affordable, convenient, engaging and flexible as possible, and our customer-centric pet care platform, underpinned by the most extensive and unique proprietary pet dataset in the UK and a true omnichannel backbone, provides us with significant competitive advantages. 

“There is much to be proud of over the last six months and much to look forward to in equal measure. While we will continue to remain focused and agile in our execution, we are, more than ever, confident in the resilience and longevity of our pet care platform.”