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Pets at Home set to reveal strong sales but slower growth

·2-min read

Pets at Home is set to reveal another jump in sales next week as a buoyant UK pet market continues to drive demand across both its retail and vet divisions.

The group has enjoyed a bumper period of growth throughout the pandemic on the back of a surge in pet ownership in the UK.

Bosses revealed sales growth of 30.2% for the three months to July compared with the same period in 2020, led by growth of 45% in its vet group.

Pets at Home boss Peter Pritchard recently announced he would stand down from the retailer (Pets at Home/PA)
Pets at Home boss Peter Pritchard recently announced he would stand down from the retailer (Pets at Home/PA)

But equity analysts at Berenberg said they were expecting this growth to slow down. They predicted sales growth of around 15% for the remainder of the year, while growth in the vet group would slow to 20%.

Pets at Home’s half-year results on Tuesday come just two weeks after the chief executive, Peter Pritchard, announced he was moving on from the firm after 11 years.

The business upped its guidance for the year’s pre-tax profits alongside the announcement of his departure and said it was now predicting profits of £130 million, a 49% jump compared with 2020.

Shares fell 3.6% after the news but Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said the market’s reaction was one of “simple disappointment”.

She said: “Mr Pritchard has overseen an impressive turnaround, and guided the pet superstore through astonishing growth during the pandemic. However, this is a natural time to walk away. This isn’t a case of a less savoury ousting or running for the hills.

“The baton being passed on to any successor is in a much better condition than it was, and the wider challenge for the newcomer will be coming up with ways to keep gathering momentum.”

Adam Tomlinson, equity analyst at Liberum, said that Pritchard “leaves the group better positioned than ever” and that the demand in the pet market shows no sign of waning.

He said: “The UK pet market remains robust, and the strong performance witnessed across both parts of the business during the second half of last year has continued throughout the past six months.”

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