Pets At Home Group, the U.K. pet-care company, has revised down its pretax profit guidance for the year ending March 31. The company now expects a group underlying pretax profit of approximately £132 million ($167.8 million), compared to the analysts’ consensus of around £136 million. This adjustment comes as third-quarter growth in Pets At Home’s retail business unit fell short of expectations.

Strong Consumer Revenue Growth

Despite the lower profit guidance, Pets At Home Group saw a 6% increase in consumer revenue for the 12-week period ending January 4 compared to the previous year. This growth was driven by higher consumer spend and increased membership in their VIP program.

Total Group Revenue and Business Unit Performance

Total group revenue for Pets At Home Group grew by 4.3% to reach £362.4 million. On a like-for-like basis, revenue rose by 4.4%. The Vet Group, one of Pets At Home’s business units, reported a significant revenue increase of 13%. The Retail unit saw a more modest revenue growth of 3.5%, or 3.7% on a like-for-like basis.

Challenges and Long-Term Opportunities

While the company acknowledged the resilience of its retail unit given the challenging comparative period, it expressed disappointment with the growth falling short of expectations. Factors such as soft discretionary accessories trends and inflation slowdown contributed to this outcome.

Despite the setback, Chief Executive Lyssa McGowan remains optimistic about the long-term growth prospects for Pets At Home Group. McGowan stated, “The business remains well positioned to benefit from long-term growth in the sector as we continue to win share and grow volumes across food and deliver differentiated performance through our unique vets business.”

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