Pets at Home's latest update announced "softer than anticipated" merchandise sales – knocking its share price down more than nine per cent, at the time of writing, to 216.40p.
Group revenue rose 4.4 per cent to £203.7m, though merchandise revenues were flat at £177.4m. The growth was propelled by its services business (including veterinary practices and dog grooming – so at least people's penchant for primping their pooches isn't on the wane).
The company said services revenues were up 47.8 per cent to £26.3m, which it said reflected joint venture vet practice fee income up 26.2 per cent to £9.5m and the boost from newly acquired specialist referral centres.
Taking out the effect of being down one trading day this year, like-for-like revenues rose 0.1 per cent, thanks to services.
Pets at Home said its profit outlook for the 2017 year remains on track and in line with market expectations.
Why it's interesting
The company didn't exactly get the early Christmas present it was after – shares wobbled late last year after the retailer said trading had weakened in recent weeks.
Still, the services business remains strong – and Pets at Home boss Ian Kellett has been adamant his company won't end up in the doghouse, saying the pet market in general "has shown to be much more resilient" than the underlying retail sector.
What the company said
Chief executive Ian Kellett said:
In merchandise, whilst overall sales were softer than anticipated, online grew strongly, reflecting the momentum gained from our investments in seamless shopping.
With a quarter to go, our profit outlook for the year remains in line with expectations, reflecting both the continued investment in our customer offer and ongoing efficiency initiatives.
Our focus on becoming more specialist, and doing the right thing for our customers, remains at the forefront of our strategy. Our colleagues worked extremely hard over the busy festive period and I want to thank them all for their commitment and dedication.
Investors have a bone to pick with Pets at Home for its softer merchandise sales – shares were down nine per cent today.