Pet group increases profit forecast as strong momentum continues

Cheshire Pet care group Pets at Home has raised profit forecasts for its full fiscal year, in a trading update today.

The Handforth-based business says it anticipates a full-year underlying pre-tax profit of at least £772m, which is ahead of previous guidance.

This figure includes the previously announced repayment of business rates relief of £28.9m.

The group said its robust balance sheet and liquidity position was strengthened further at the end of 2020 through £80m in initial cash proceeds relating to the completion of the disposal of its specialist group to Birmingham-based Linnaeus Group, a subsidiary of Mars Veterinary Health, in a deal worth £100m.

In today’s update, covering the third quarter of the fiscal year ending December 31, 2020, the group said the momentum from the previous half year continued.

It said the interim results announcement, on November 24, highlighted the inherent resilience of both its pet care model and the underlying pet care market.

This was reflected in strong sales momentum across the retail and veterinary operations during the second quarter, despite an extremely challenging external environment caused by lockdown.

This momentum has accelerated across all channels during the third quarter, it said, with ‘high-teens’ group like-for-like sales growth during December.

And, while renewed COVID-related restrictions on a national level may constrain trade, the business remains an “essential” retailer and it said the measures it continues to take across stores, veterinary practices and online operations are ensuring it remains in a strong position to meet all of its customers’ pet care needs.