Changes to the National Living Wage and employers’ National Insurance Contributions will cost Pets at Home an additional £18m in the next financial year, the retailer revealed in its FY25 Interim Results for the 28-week period to October 10, 2024.
The half-year trading period was marked by “an unusually subdued pet retail market”, said the company, with retail revenue growth of just 0.1% (flat on a like-for-like basis). During the half year, the retailer opened three new stores and refitted a further 14.
However, the operator’s Vet Group revenue growth remained strong at 18.6% (18.2% LFL), meaning that total group revenue grew by 1.9% to £789.1m, with like-for-like revenue up 1.6%.
The company also achieved sales growth of 3% among members of its Pets Club loyalty scheme, which now has 8.1million consumers signed up. Pets Club was recently relaunched on the retailer’s new digital platform, and the updated platform led to a near-doubling of app sales during the period, reported Pets at Home.
Chief executive Lyssa McGowan said: “The first half of FY25 was characterised by a subdued market, against which we outperformed. In Vets, our differentiated joint venture model continues to drive material outperformance over peers. In Retail, our customer satisfaction is excellent, our price position is strong, and we have tight control of our cost base.
“Our Stafford distribution centre is performing well, supporting near record availability in stores, and we will unlock efficiency savings through automation in e-commerce into next year. The unusually subdued pet retail market we now expect to continue through H2. We are confident this will be temporary, and growth will return to historical norms with the longer-term attractive outlook for the UK pet care market unchanged.”
The company will mitigate the cost increases due to the Budget, McGowan added, through ongoing productivity programmes and investments in automation.
