The chief of Pets At Home has said pet owners are keen to treat their animals still, as the FTSE 250 firm posts subdued profit before tax.
In interim results, the London-listed business posted underlying profit before tax of £59.2m, some 9.3 per cent below its previous half-year sum of £65.3m.
Profit slipped due to heightened freight and energy costs, the firm said, as inflation hit a 41-year high last month.
Customers were continuing to splash the cash on premium products and services, Lyssa McGowan, chief executive officer said.
Increased pet ownership was “far from being a COVID boom”, McGowan said, adding that “elevated levels of pet ownership are here to stay and continue to drive growth.”
On Wednesday morning, analysts said it was unlikely pet owners would trim back spending on their animals amid an economic downturn, with consumers opting to budget in other parts of their lives instead.
The company said it expected its full-year group underlying profit before tax to meet analysts’ expectations, with a consensus of £131m, in a range of £121-136m.
As consumers start to feel inflationary pressures hitting their budget over the coming months, Pets At Home’s revenue may “take a hit”, warned Sarah Riding, retail partner at law firm Gowling WLG.
“Investors will be wary of this eating into profits,” she said.
The retailer’s share price took a battering to the tune of three per cent in early trading on Wednesday morning.