Pets at Home has grown its revenues by 10.2% to £381.5m in the first half of its financial year and will be paying its shareholders an interim dividend of 1.8p per share. In its interim results for the 28 week period from 28th March to 9th October 2014 annouced today, the company said it was "delivering on the strategic plan across all measures."

Nick Wood, Chief Executive Officer, commented: “We are pleased with our first half financial performance. We continue to deliver on our strategy to be the leading destination brand for pet lovers, with particularly strong performance from new growth areas including vets and groom rooms. Our passion for pets guides everything we do and it’s a passion we share with our customers, with more than half a million joining our VIP Club during this period.”

“We end the first half in a strong financial position, the business remains very cash generative and we are pleased to announce our first dividend payment. Looking ahead, we will continue to focus on our successful strategy, and by doing so, we are confident that we can deliver sustainable long-term growth.”

H1 FY15 financial highlights

• Total revenue growth of 10.2% to £381.5m
• Merchandise revenues up 8.9% to £348.3m, comprised of Food revenues up 9.6% to £188.7m and Accessories revenues up 8.0% to £159.6m
• Services revenues up 27.0% to £33.2m, reflecting both new openings and the growing revenue streams from our maturing vet practices and Groom Rooms
• Like-for-like (LFL) sales growth 4.2%, driven by strength in Advanced Nutrition, Health & Hygiene, VIP Club, growth from our vet practices and Groom Rooms, and omnichannel
• Merchandise LFL revenue growth of 3.7%
• Services LFL revenue growth of 10.2%
• Gross margin of 53.8%, +20bps on the prior year; reflecting Merchandise margin +7bps to 55.9% and strong Services margin expansion +546bps to 31.7%
• Underlying EBITDA of £58.6m (+10.8%) and margin of 15.4%, expansion of 8bps on the prior year, despite £1.4m in additional Plc operating costs
• Underlying free cashflow of £33.8m, conversion of 57.7% compared with prior year at 43.8%
• Interim dividend of 1.8p per share

H1 FY15 Operational highlights

• Added 8 stores net to the portfolio total of 385; including 10 new stores, one store closure in Knutsford, and a temporary closure of our Rugby store which will be relocated in H1 FY16
• Opened 26 veterinary practices, bringing the total portfolio to 303
• Opened 23 Groom Rooms, bringing the total portfolio to 152
• VIP Club reached 2.6m members, up from 2.0m at the end of FY14
• Wainwright’s grew 54.8% to £20.5m, driven by launches of WW’s Cat & Grain Free for dogs
• Refreshed 30% of total SKUs, of which over a third are own brand or private label
• Deliver To Store online offering now fully operational, which gives customers access to the extended omnichannel range of 10,800 SKUs for pickup in their local store

Outlook

The pet care market outlook remains positive. We continue to expect gross openings of around 25 stores, 60 veterinary practices and 50 Groom Room salons in FY15.

Management and the Board remain confident in the Group’s prospects for the year and trading since the end of the half year period has been in line with our expectations.