Pets at Home cuts FY profit guidance on subdued retail market

(Sharecast News) - Pets at Home cut its full-year profit guidance on Thursday, pointing to "subdued" retail market growth rates. In its FY25 results, Pets set its FY26 guidance based around an assumption of 2% growth in the pet retail market. It said on Thursday that while this scenario assumed improving growth through the year, the market growth rates in the first quarter have been below those initial expectations.

It now expects market growth of around 1% and has adjusted its guidance to reflect this. As a result, Pets cut its full-year underlying pre-tax profit range to between £110m and £120m, from previous guidance of £115m to £125m.

"Where we end up in our updated range is mostly dependent on the trajectory of retail market growth through the second half of FY26," it said.

"Reaching the top end of guidance would require a step up in market growth, while the bottom end of guidance would imply a continuation of current subdued market trends through the remainder of the year."

The group said that against this subdued market backdrop, it was "pleased" to have delivered sequential improvement in its relative performance and continues to expect it will outperform the retail market over FY26.

In the 16 weeks to 17 July, consumer revenue rose 0.4% to £591m. Vet Group revenue was up 7.1%, driven by higher average transaction value and increased numbers of Care Plans.

Meanwhile, retail consumer revenue declined 3%, with sequential improvement, as the company moved beyond the transition of online sales to Stafford DC, and delivered against a subdued market backdrop with no growth in the pet retail market.

Group statutory revenue fell 1.9% to £435m, with group like-for-like revenue down 1.9%.

Vet Group revenue grew 6.2%, with LFL growth of 7.8%, reflecting strong consumer revenue growth and continued progress in converting company-owned practices into Joint Venture practices.

Retail revenue declined 3.0% year-on-year, with LFL sales down 3%.

Chief executive Lyssa McGowan said: "We are pleased to have seen momentum in our business build through Q1, against a subdued market backdrop and uncertain consumer environment.

"Progress has been made across all 4 of our strategic metrics in the quarter, including growing our subscription revenues by over 40%, growing Pets Club members, increasing average spend and continuing to grow our Vet talent as we continue building the world's best pet care platform."