Pets at Home Group PLC (LON:PETS) took its time releasing its Christmas trading update but it looks like it was worth the wait.
The pet care business said group revenue in the 12 week period from 13 October to 4 January was up 6.3% from the same period a year earlier to £237.2mln.
READ: Analysts round on Pets at Home as vet restructuring squeezes margins
Retail revenue was up 5.5% to £213.4mln, with online orders up 41.5% to £19mln.
Vet group revenue rose 13.6% to £23.8mln.
On a like-for-like basis, group revenue was up 5.1%; retail revenue was up 4.7% and vet revenue was up 9.1%.
The retail said customer key performance indicators continue to improve with the visit frequency of its VIP members club on the up, as is the amount they typically spend. The number of VIP members who purchase products and services has grown by 16% year-on-year.
The group reiterated full-year guidance of underlying profit before tax of £80mln to £85mln and underlying free cash flow of at least £55mln.
How we're spending this weekend ???? pic.twitter.com/ugYoHckfwF
— Pets at Home (@PetsatHome) January 19, 2019
"Momentum in Retail accelerated over the festive period, culminating in the biggest trading day of our entire history on the Saturday before Christmas,” revealed Peter Pritchard, the chief executive officer of the group.
“Our omni-channel business delivered exceptional performance, benefiting from investments made earlier in the year, including a new mobile website. This resulted in a 4.7% like-for-like growth in Retail, an impressive 11% growth on a two-year basis,” he continued.
“We saw good customer revenue growth across our entire Vet Group. In November, we reiterated the big opportunity to accelerate the maturity of our vet practices, but this needs to be achieved in a more sustainable way. As such, I am particularly pleased with how the recalibration of the Vet Group is taking shape; the engagement from JVPs [joint venture partners] has been positive and we have made good progress in our discussions with buyback practices,” he added.
In early afternoon trading, Pets at Home shares were 9.8% higher at 137.60p.
Pat on the back for Pets
Sophie Lund-Yates, equity analyst at Hargreaves Lansdown commented: “The woes of retail are being talked about every day it would seem, but Pets at Home’s managing to keep the downturn at bay. Steady like-for-likes mean the group should give itself a pat on the back, but some of the sales momentum is coming from price cuts, which isn’t a good move for long-term health.”
She added: “We admire Pets at Home’s efforts to get punters through the door though. Its vet and grooming clinics are paying off, despite a less-than-perfect launch period. By making stores a one-stop shop for pet owners, the group’s better positioned than shops with less enticing propositions.”
“All in all, Pets at Home has woken up to the fact the retail environment has changed, and has adapted to fit that. The group has forged itself a sturdy and viable consumer offering, which will come in handy if the retail climate gets much tougher.”
-- Adds analysts comment, updates share price --