Pets at Home has lowered its profit expectations for the current financial year, citing weaker-than-expected retail performance. The company now anticipates annual profits to be between £110 million and £120 million, a significant reduction from last year’s £133 million and the previous forecast of £115 million to £125 million.
The retailer reported a 3% decline in like-for-like sales over the 16 weeks to July 17, marking its third consecutive quarter of negative growth. This drop comes as the overall pet retail market struggles, with growth projected to be just 1%, down from an earlier estimate of 2%.
The company has attributed its revised outlook to subdued market conditions and an uncertain consumer environment, which have affected its trading performance. Despite efforts to control costs, including tight cost management measures, the retailer has faced additional challenges, such as a £20 million increase in wage-related expenses.
However, Pets at Home noted that its Vet Group segment has been performing well, with like-for-like revenue growth of 7.8%. Additionally, the company has seen a rise in its Pets Club membership, which now totals 8.1 million customers, contributing 14.5% of its revenue from subscriptions.
