Pets at Home cuts next year’s profit guidance as costs increase

Pets at Home has slashed its profit guidance for the upcoming financial year as it prepares for a hike in costs stemming from the Budget.

The pet specialist warned it faces a £30m increase in costs arising from changes to employers’ National Insurance contributions, new packaging regulations and the rebuild of variable pay.

It said its ability to mitigate cost inflation depends “on the rate of sales growth we are able to deliver, which is dependent on how consumer demand evolves and how inflation comes through”.

As a result, it expects group underlying profit before tax to be down during the next financial year and fall within the range of £115m to £125m.

Pets at Home said this year’s pre-tax profits will be in line with its previous guidance of £133m after final quarter trends were “broadly as we planned” across its retail and vets divisions amid “a challenging and volatile UK consumer backdrop”.

The retailer said it had completed its network optimisation following the transition of online sales to its Stafford distribution centre, “setting our retail business up to return to sales growth and market outperformance in FY26”.

Pets at Home CEO Lyssa McGowan said: “We are making good progress in delivering our strategy of building the world’s best pet care platform, although the market remains challenging with subdued consumer confidence and the business facing significant external cost headwinds in 2025.

“Our Vets business is delivering very strong growth and continuing to outperform the market, with a robust pipeline of new openings in place for the coming year leveraging our unique practice owner model.

“In Retail, we’re confident that with our major infrastructure investments behind us, we are well placed for future growth as the short-term pressures ease and the consumer environment improves.

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