Pets at Home Group Plc recorded a significant decline in annual pretax profit for the year ended March 2026, reporting £92.8 million compared with £133 million in the prior year. Despite the drop, the company said results were broadly in line with earlier guidance and that it was comfortable with market expectations for a recovery in the coming fiscal year, a development that helped lift the group's shares by more than 4%.
The reported pretax profit exceeded the company's own March outline of £92 million and remained inside the £90 million to £100 million range the business had communicated in September 2025. Management reiterated its comfort with consensus analyst forecasts calling for £98 million of pretax profit in fiscal 2027.
Division-level performance
The split between the group's Retail and Vet operations was stark. Retail pretax profit fell by 58% to £31 million. The company attributed this reduction to a softer market environment and weaker demand in discretionary accessories, where like-for-like sales declined by 3.5%.
By contrast, the Vet division delivered stronger profitability, with pretax profit rising 10% to £84 million. The company also reported a 6% increase in revenues from joint-venture consumer activities.
Trading momentum and operational metrics
Current trading data released alongside the results suggested improvement in Retail like-for-like sales growth, which the company said had accelerated to a mid-single-digit percentage rate from 2.2% in the fourth quarter. This marked what the company described as a fifth consecutive quarter of improvement. The firm noted that the comparative period in the first quarter was more challenging, at negative 2.8%, than the comparative in the fourth quarter, at negative 5.2%.
Additional operational details included a statement that volume growth was outpacing sales growth and that customer satisfaction scores had improved by four percentage points, including on measures of value for money. Management also disclosed delivery of £20 million in cost savings during the period.
Outlook for fiscal 2027
For fiscal 2027, Pets at Home forecast like-for-like sales growth, supported in part by market growth estimated at 1% to 2% and anticipated market share gains. The company expects profit growth across both the Retail and Vet divisions, with the Vet business projected to deliver low-single-digit profit growth and momentum building through the year.
Market and broker reaction
Market commentators highlighted the preservation of guidance as the key takeaway. One analyst said the intact FY27 guidance was central, noting that after a year in which Retail profits substantially weakened and Vet carried the group, the business needed to demonstrate a credible recovery path.
Analysts warned the Retail division would be an area to watch, suggesting that being the go-to store for customers will be increasingly important as pet ownership trends normalise and competition intensifies. These comments were framed around the need for Retail to regain momentum after its sharp profit decline.
Jefferies, which maintains a "buy" rating and a price target of 265 pence on the stock, said early initiatives are producing momentum and that it is confident fiscal 2026 will represent trough divisional earnings. The broker trimmed its fiscal 2027 pretax profit estimate to £101 million from £106 million, citing macro uncertainty and the possibility that the new chief executive, James Bailey, may opt to reinvest in growth opportunities. Despite the reduction, Jefferies' estimate remained above the £98 million consensus referenced by the company.
Jefferies' fiscal 2027 earnings per share estimate stood at 17.28 pence, down from a prior 17.84 pence forecast. The broker also said its fiscal 2027 estimate was 8% above consensus and its fiscal 2028 estimate was 21% above consensus.
What the results mean
The group’s full-year numbers underscore a business in transition: robust performance and margin resilience in the Vet division cushioned a marked deterioration in Retail profits. Management's ability to maintain FY27 guidance, combined with signs of improving Retail like-for-like growth and operational efficiencies, underpinned investor confidence despite the annual profit drop.
However, the divergent divisional dynamics and external headwinds flagged by brokers mean the path to recovery will be watched closely by investors, with retail trading trends and the pace of margin recovery in both divisions central to future performance.