Pets at Home chain plans to open 40 new stores

Pets at Home says it is planning to open at least 40 new stores across the UK as home working inspires more people to buy pets.

The retailer, which has almost 460 shops currently, unveiled the plans as it reported record annual profits.

It said it was particularly interested in opening in urban areas like London.

Pets at Home, which put up its prices this year, said the rise in home working meant more people were buying pets at a younger age.

Lyssa McGowan, who took over as chief executive last June, said the opportunity offered by "Generation Z" was there for the taking.

Total revenue at the business was up 6.6% to £1.4bn in the year to the end of March.

Underlying pre-tax profits came in at £136.4m - up 4.8%.

The record performance came despite the business facing soaring energy costs and having to pay higher wages.

While the group has put up prices, it said it had held back from passing on all the cost pressures it has been facing.

Ms McGowan added that it was hard to predict prices over the year ahead, but pledged to pass on any cuts if its own wholesale costs fell.

The chain, which also offers grooming and veterinary services, said the boom in pet ownership seen during the pandemic had showed little sign of easing, despite the cost-of-living crisis.

Membership of its VIP loyalty club scheme, which offers discounts and tips, has grown to 7.7 million.

The firm said the scheme was still attracting large numbers of new consumers, with around 24,000 puppy and kitten owners signing up each week.

This is down slightly from the 29,000 seen during the pandemic, but still "significantly" higher than pre-Covid, it said.

The company's £400m growth strategy also includes building a new app which will allow customers to book veterinary appointments and manage subscriptions.

However, the firm's plans for investment are expected to hold back profit growth in the year ahead as the firm reinvests.

It said it expected underlying pre-tax profits to be flat in 2023-24 at around £136m.