REG - Pets at Home Grp - FY24 Preliminary Results
29/05/2024 07:00
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RNS Number : 1709Q Pets At Home Group Plc 29 May 2024
FOR IMMEDIATE RELEASE, 29 MAY 2024
Pets at Home Group Plc: FY24 Preliminary Results
for the 52-week period to 28 March 2024
A pivotal year building our platform for future growth
Business Highlights
FY24 has been a foundational year for Pets at Home. We have delivered the key
strategic elements that will form the platform for future growth. We have:
• Launched digital platform to consumers, an important milestone in the
digitisation of the business, with our new app and website positioned to bring
together everything owners need to care for their pet.
• Brought our new DC onstream, with all stores now being served from a single
site and availability at structurally higher levels. We will complete the
transition of our online business in the coming year.
• Continued progress in growing our vet footprint, with 3 new vet practices, 26
practice extensions, and 10 company-owned to JV conversions, supported by
further progress on vet talent.
• Invested in our pet care centres with 5 new openings and 41 store refits.
• Grown our large, loyal customer base. We now have 7.8m active Pets Club
members, up 2% YoY with strong retention and a continued normalisation in new
Puppy & Kitten sign ups as expected.
• 1.7m subscriptions, now generating 10% of consumer revenue. The launch of our
digital platform will offer customers an enhanced subscriptions capability
with improved choice and flexibility.
• Launched our new unified Pets brand, bringing together all of our products and
services under one master brand reflecting our consumer positioning as a
provider of all your pet care needs.
• Accelerated range innovation, introducing new frozen ranges, launching an own
brand freeze-dried range, and exclusively partnering with Butternut Box to
offer freshly-cooked dog food to consumers.
• Progressed our sustainability agenda, reducing our Scope 1 & 2 emissions
by a further 3.5%, raising over £9.2m for pet charities, feeding 2.7m pets
for a day through our pet food bank partnership with Blue Cross, and donating
over 16,000 hours to local communities.
Financial Highlights
• Consumer revenue(#) grew 6.9%, in line with our medium-term ambition, to
£1.9bn. Underlying consumer demand was resilient with structural trends
underpinning sustained market growth.
• Total Group revenue growth of 5.2% to £1.5bn, with Group like-for-like(#)
(LFL) revenue up 5.1%.
• Vet Group revenue grew 16.8%, and LFL(#) up 16.5%, with record sales supported
by higher Average Transaction Value, mix and visits as we increased clinical
capacity.
• Retail revenue grew 4.0%, and LFL(#) up 4.1%. Q4 LFL was in line with
expectations with continued volume growth and slowing inflation in food, and
softer performance within accessories.
• Underlying PBT(#) of £132.0m is down 3.2% YoY as guided, impacted by
short-term availability issues as we transitioned to our new DC and weaker
performance of discretionary accessories. Returning accessories to growth is a
key focus in the year ahead and we have a strong plan to do so.
• Statutory PBT was £105.7m, down 13.7% reflecting the decline in underlying
PBT and non-underlying costs of £26.3m, mostly associated with our DC
transition and our support office consolidation.
• Underlying basic EPS was 20.7p, down 9.0%, and statutory basic EPS was 16.6p,
down 19.0%.
• Total dividend per share held at 12.8p, final dividend held at 8.3p.
• Free cash flow(#) down 29.7% to £69.0m reflecting YoY profit shape and the
phasing of investments.
• Balance sheet remains robust with net cash(#) of £8.8m (before lease
liabilities of £380.9m). Cash and cash equivalents were £57.1m at the end of
the year.
• £25m share buyback announced for FY25, having completed £100m in buybacks
over last 2 years.
Lyssa McGowan, Chief Executive Officer:
"FY24 has been a pivotal year for the business, having delivered some key
building blocks of our platform for long term growth. I am proud of the
progress we have made in the year; we relaunched our brand, opened our new DC,
built our new digital platform, made progress in our sustainability agenda,
and enhanced our physical estate. The business has come together brilliantly
to navigate any challenges faced this year, and we have delivered some key
milestones of our strategy.
Our medium-term strategy and financial framework is unchanged and, looking
ahead, the fundamental strengths of the business position us well to deliver
growth. We hold a leading position in a structurally growing market, with an
unrivalled retail store network, and a unique, differentiated and integrated
vet business. We know the nation's pets better than anyone else, with over 10
years of analytical data on 10 million pets, and we now have a best-in-class
digital platform, and a modern efficient DC.
Above all else, we have the best colleagues in the industry, who use their
passion and expertise to guide customers through their pet care journey every
day. All of this positions us incredibly well as we continue to execute our
strategy to build the world's best pet care platform."
Current trading and outlook
No change to FY25 underlying PBT guidance. Whilst the external trading
environment has been subdued, overall pet care spend has proven resilient, and
in the year ahead, we should begin to benefit from previous investments and
key productivity programs.
Over the first 6 weeks of the year, we have seen low double-digit growth in
our Vet Group, with Retail at -2%, broadly in line with plan. Retail LFL
currently reflects the annualization of our strongest comparative periods, and
some short term disruption as we transitioned to our new digital app from the
legacy web platform. We are currently projecting that these impacts will ease
from Q2 onwards.
Market growth in recent quarters has been impacted by easing inflation,
continued caution amongst consumers, and the timing impacts of normalised
numbers of new puppies and kittens. Importantly through this period we have
consistently won share in our key food category, and are currently expecting
industry growth to progressively return closer to historic levels over the
coming quarters.
For FY25:
■ We are comfortable with current analyst consensus for underlying PBT,
currently c£144m.
■ We expect non-underlying costs of c£7m reflecting further transition costs
for the DC (£3m) and one-off support office restructuring costs (£4m).
■ Effective tax rate is expected to be 26%.
■ Plan for capex of £60m.
■ Planning for a further £25m share buyback, following the £100m completed
over the last 2 years.
Delivering against our strategy - Building the world's best pet care platform
Our medium-term vision and strategy is to build the world's best pet care
platform. As the UK's only complete pet care provider we have a leading
position in a structurally growing market, and our strategy will help
differentiate us further and unlock the unique opportunity we see ahead,
generating long-term sustainable value for all stakeholders.
FY24 has been a pivotal year for the business and represents just one year of
a medium-term strategy that will enable us to build an even better business
that is fully integrated for customers, offers a seamless omnichannel
proposition, and that provides a truly consumer-centric experience.
An integrated consumer experience
■ Our pet care platform truly integrates our unique blend of products, services
and advice. Once complete, it will span the entire group, seamlessly
connecting consumers, vets, and retail colleagues.
■ Our Pets Club loyalty program provides unique insights into the UK pet
population, with over 10 years of analytical data on 10 million pets. We now
have 7.8m active members, +2% YoY.
■ Growing share of wallet is our greatest opportunity, unlocked by creating
easy, frictionless, and enjoyable customer journeys across our platform.
■ Our average customer now spends £178 a year with us, but our most engaged
customers spend over £900, highlighting our significant growth headroom.
A unique data and digital platform
■ Our new app and website are live, transforming the shopping and subscription
experience for pet owners. Early insights are positive, with average daily app
sales up c25% versus pre-launch.
■ This marks a major step in the digitisation of the business but is only the
beginning of what we will offer consumers, and we will continue to deliver a
succession of improvements in the years ahead.
■ We will increasingly leverage data to drive targeted and highly personalised
offers, improve operational efficiency, and grow predictable, sticky revenue
streams e.g. subscriptions.
■ The final element of our digital platform, a new vet practice management
system, will pilot this year enabling vets to deliver improved efficiency and
clinical productivity, and access real-time client data.
Differentiated, sector-leading vets
■ We are the only business which has successfully brought together clinical and
retail services at scale, a key part of offering complete pet care to
customers.
■ Our unique practice owner model has driven record growth and consistent market
outperformance, with consumer revenues now £576m, acting as a material
contributor to the overall group.
■ As more practices reach maturity it unlocks opportunities to drive additional
growth through advanced capabilities, practice extensions, and the rollout of
5-15 new practices a year.
■ We believe that our vets growth strategy is not threatened by the CMA's review
into the vet sector. Our key building blocks for growth support competition
and deliver better outcomes for consumers.
An unrivalled retail proposition
■ We will leverage our category authority and expertise to lead on innovation in
food, led by our own brands (up 13% YoY), introducing new ranges, and
increasing our presence in emerging areas.
■ We plan to return accessories to growth through driving premiumisation,
leveraging exclusive licenses and tie-ups, and creating points of engagement
around major events.
■ Our nationwide network of pet care centres gives us scale and reach
advantages, bringing us closer to pet owners and able to offer more
flexibility and convenience than competitors, all under one roof.
■ We will continue to open new pet care centres in attractive catchments,
particularly urban, targeting 35-40 new openings over the medium term, as well
as continuing to invest in our existing estate.
Our values underpin everything we do
■ Planet: We will continue to reduce the carbon intensity of our own operation.
Our 3.5% reduction in Scope 1&2 emissions in FY24 takes the reduction over
the past 9 years to 44%.
■ Pets: We remain the biggest supporter of pet-related charities in the UK
through the Pets Foundation, having raised over £9.2m in this year alone.
■ People: We continue to support the communities in which we operate, and our
colleagues have collectively donated over 16,000 hours to local causes through
our Better World Pledge days.
Our financial framework
FY24 was a pivotal year for the business, and represents just the first year
of a multi-year strategy. Our financial framework remains unchanged, and over
the medium term we expect to deliver the following.
■ Ambition to grow consumer sales at 7% per annum, within a market growing at
c4%.
■ Target 10% PBT CAGR through operational leverage and productivity gains.
■ FCF conversion trends to 70% of PBT, as capex tapers and benefits from
previous investments flow.
■ Maintain capital discipline and a clear capital allocation policy;
1. Invest £280m of capex in the business over medium term; £400m including
digital/opex investment.
2. Pay a progressive ordinary dividend targeting 50% EPS payout.
3. Explore inorganic growth opportunities. Focus on strategic investments and
bolt-on M&A.
4. Return excess cash to shareholders subject to maintaining a prudent balance
sheet and not constraining the business.
Key Performance Indicators
Financial KPIs(1) FY24 FY23 YoY
Consumer revenue(#, 2) (£m) 1,906.3 1,782.4 6.9%
Underlying PBT(#) (£m) 132.0 136.4 (3.2)%
Free cash flow(#) (£m) 69.0 98.2 (29.7)%
Underlying Basic EPS(#) (p) 20.7 22.8 (9.0)%
Strategic KPIs FY24 FY23 YoY
Number of active Pets Club members(3) (m) 7.8 7.7 1.6%
Average Consumer Value(4) (£) 178 168 5.7%
% of Revenue from Subscriptions(5) (%) 10.0 6.7 330bps
Clinical FTE Headcount(6) (k) 3.3 3.0 10.0%
1. Financial KPIs represent those used by the business to monitor performance.
Management recognise that as Alternative Performance Measures they differ to
statutory metrics, but believe they represent the most appropriate KPIs. GAAP
Measures are presented on pages 74-76.
2. Consumer revenue includes consumer revenue made by Joint Venture vet
practices, and therefore differs to the fee income recognised within Vet Group
revenue.
3. Number of active Pets Club members who transacted across the group in the last
365 days prior to the end of the reporting period.
4. The average spend of active Pets Club members across the group over the last
365 days based on consumer revenue as defined above, rather than statutory
revenue.
5. Subscription revenue includes our Flea & Worm, Easy Repeat, Complete Care
and Vac4Life plans and is divided by Group consumer revenue.
6. Full time equivalent number of all vets and nurses working across the group,
based on standard working hours.
Results presentation
A presentation for analysts and investors will be held today at 9:30am at
Deutsche Numis, 45 Gresham Street, London, EC2V 7BF, attendance is by
invitation only. To access a live streaming of the event, please click on the
following link https://brrmedia.news/PETS_PRFY24
(https://brrmedia.news/PETS_PRFY24) . A webcast and statement of these results
will be available for playback after the event at www.petsathomeplc.com
(http://www.petsathomeplc.com) .
Our next scheduled update will be our Q1 FY25 trading statement on 1 August
2024.
Investor Relations Enquiries
Pets at Home Group Plc:
Andrew Porteous, Director of Investor Relations +44 (0) 7740 361 849
Chris Ridgway, Head of Investor Relations +44 (0) 7788 783 925
Media Enquiries
Pets at Home Group Plc:
Natalie Cullington, Head of Communications +44 (0) 7974 594 701
Citigate Dewe Rogerson:
Angharad Couch +44 (0) 7507 643 004
About Pets at Home
Pets at Home Group Plc is the UK's leading pet care business, providing pets
and their owners with the very best advice, products and care. Pet products
are available online or from over 450 pet care centres, many of which also
have vet practices and grooming salons. The Group also operates a leading
small animal veterinary business, with over 440 veterinary general practices
located both in our pet care centres and in standalone locations. For more
information visit: http://investors.petsathome.com/
(http://investors.petsathome.com/)
Disclaimer
This trading statement does not constitute an invitation to underwrite,
subscribe for, or otherwise acquire or dispose of any Pets at Home Group Plc
shares or other securities nor should it form the basis of or be relied on in
connection with any contract or commitment whatsoever. It does not constitute
a recommendation regarding any securities. Past performance, including the
price at which the Company's securities have been bought or sold in the past,
is no guide to future performance and persons needing advice should consult an
independent financial adviser. Certain statements in this trading statement
constitute forward-looking statements. Any statement in this document that is
not a statement of historical fact including, without limitation, those
regarding the Company's future plans and expectations, operations, financial
performance, financial condition and business is a forward-looking statement.
Such forward-looking statements are subject to risks and uncertainties that
may cause actual results to differ materially. These risks and uncertainties
include, among other factors, changing economic, financial, business or other
market conditions. These and other factors could adversely affect the outcome
and financial effects of the plans and events described in this statement. As
a result you are cautioned not to place reliance on such forward-looking
statements. Nothing in this statement should be construed as a profit forecast
Chief Financial Officer's Review
The FY24 period represents the 52 weeks from 31 March 2023 to 28 March 2024.
The comparative period represents the 52 weeks from 1 April 2022 to 30 March
2023.
The Group's results are shown as three segments that represent the size of the
respective businesses and our internal reporting structures; Retail (includes
products purchased online and in-store, pet sales, grooming services and
insurance products), Vet Group (includes general practices and our veterinary
telehealth business) and Central (includes Group costs and finance expenses).
FY24 FY23(3) YoY change
Group consumer revenue (£m) 1,906.3 1,782.4 6.9%
Retail 1,330.1 1,278.7 4.0%
Vet Group 576.2 503.7 14.4%
Group statutory revenue (£m) 1,476.6 1,404.2 5.2%
Retail 1,330.1 1,278.7 4.0%
Vet Group 146.5 125.5 16.8%
Group like-for-like revenue growth(#) 5.1% 7.9%
Retail 4.1% 7.5%
Vet Group 16.5% 13.4%
Group gross profit margin(3) 46.8% 48.0% (123)bps
Retail 46.2% 47.5% (137)bps
Vet Group 52.7% 53.3% (53)bps
Group statutory PBT (£m) 105.7 122.5 (13.7)%
Group statutory PBT margin 7.2% 8.7% (157)bps
Group underlying PBT(1,2,#) (£m) 132.0 136.4 (3.2)%
Retail 87.4 98.8 (11.5)%
Vet Group 61.6 51.3 19.8%
Central (17.0) (13.7) (23.1)%
Group underlying PBT margin(1,2,#) 8.9% 9.7% (77)bps
Retail 6.6% 7.7% (115)bps
Vet Group 42.0% 40.9% 108bps
Statutory basic EPS (p) 16.6 20.5 (19.0)%
Statutory diluted EPS (p) 16.4 20.2 (18.8)%
Underlying basic EPS(1,2,#) (p) 20.7 22.8 (9.0)%
Non-underlying items(1,2) (£m) (26.3) (13.9) (12.4)
Free cash flow(#) (£m) 69.0 98.2 (29.7)%
Cash and cash equivalents (£m) 57.1 178.0 (120.9)
Total indebtedness(#) (£m) (372.0) (366.7) (5.3)
Net cash(#) (£m) 8.8 54.7 (45.9)
Dividend (p) 12.8 12.8 -
Number of
Pet care centres 458 457 1
Grooming salons 347 345 2
Joint Venture vet practices 391 387 4
Company managed vet practices 56 57 (1)
1. FY24 non-underlying items of £21.7m (FY23: £10.1m) relate to transition
costs relating to our new distribution centre, £4.4m (FY23: £2.7m) relating
to restructuring of certain support functions, and £1.1m (FY23: £nil)
relating to the write down of investments. In addition, in FY23 we incurred
£0.1m relating to aborted project costs. All allocated against non-underlying
operating costs.
2. FY24 non-underlying cost of £0.1m (FY23: £1.0m) relates to transition costs
relating to our new distribution centre, recognised within non-underlying
interest charge.
3. Refer to Note 1 of the accounts for an explanation of the prior year
restatement.
Revenue
Consumer revenue(#) grew 6.9%, in line with of our medium-term ambition, to
£1.9bn (Retail £1.3bn, Vets £0.6bn), with all channels remaining in growth.
Group statutory revenue in FY24 grew 5.2% to £1,476.6m (FY23: £1,404.2m) and
like-for-like (LFL) revenue grew 5.1%(#).
Retail revenue grew 4.0% to £1,330.1m (FY23: £1,278.7m), with LFL revenue
growth of 4.1%(#). This includes the short-term disruption to our in-store
sales performance in Q2 due to the transition to our new DC, which impacted Q2
LFL by c3%. Outside of this, the shape of performance has remained broadly
consistent throughout the year with strong growth and share gains in food, but
softer trends in discretionary accessories as noted previously. Performance in
Q4 was in line with our expectations and as previously guided.
Vet Group revenue was up 16.8% to £146.5m (FY23: £125.5m) and LFL revenue
grew by 16.5%(#). Total Joint Venture fee income increased by 15.7% to £89.3m
(FY23: £77.2m) and revenues from company managed practices increased by 18.7%
to £44.6m (FY23: £37.5m). Revenue of £3.2m was recognised in relation to
The Vet Connection, our telehealth business.
LFL Revenue Growth Q1 Q2 Q3 Q4
Retail 7.1% 2.8% 3.7% 2.1%
Vet Group 16.6% 18.3% 13.3% 17.8%
Group 7.9% 4.1% 4.4% 3.4%
Gross margin
Group gross margin(1) decreased YoY by 123 bps to 46.8% (FY23: 48.0%).
Gross margin(1) within Retail was 46.2%, a reduction of 137 bps over the prior
period (FY23: 47.5%), predominantly driven by food growing faster than
accessories (76bps impact on Group gross margin), as well as a foreign
exchange impact as our contracted $ rate was lower YoY (90bps impact on Group
gross margin). We have now hedged c80% of our foreign exchange requirements
for FY25 at an average rate of $1.25 (FY24: $1.19), meaning FX will act as a
slight tailwind to gross margin in the year ahead.
Gross margin(1) within the Vet Group decreased by 53 bps to 52.7% (FY23:
53.3%) including a £2.2m impact from a planned one-off marketing investment
into our TV brand launch campaign which is charged against gross margin.
Excluding this impact, the strong sales growth across our Joint Venture estate
against a relatively fixed cost base, as well as the YoY improvement in
performance in our company managed practices, helped deliver a 92bps YoY gross
margin expansion.
Operating costs
Operating costs(2) of £584.7m (FY23: £550.0m) grew at 6.3% including a
£13.3m YoY increase in non-underlying costs. In FY24, we incurred a total of
£26.2m of non-underlying operating costs (FY23: £12.9m). Before
non-underlying costs, operating costs(2) grew 4.0%.
(£m) FY24 FY23 YoY
Selling and distribution expenses 442.2 416.1 6.3%
Administrative expenses 116.3 121.0 (3.9)%
Underlying operating costs 558.5 537.1 4.0%
Non-underlying costs 26.2 12.9 13.3
Operating costs 584.7 550.0 6.3%
We continue to maintain a tight operational grip on industry-wide cost
headwinds, most notably in FY25:
• The 9.8% increase in National Living Wage, a c£16m unmitigated cost headwind
to the business
• The removal of business rates relief as announced in the Autumn Statement, a
c£2m cost
As well as directly mitigating these costs where possible, we are also
proactively offsetting them through our ongoing self-help initiatives. Our
programme of store rent reductions is progressing well; where we have actively
sought to reduce the rent at property lease events, we have achieved an
average reduction of 20%. We expect to complete 40 lease renegotiations in
FY25. We also continue to target efficiencies across consumables and goods not
for resale, and we are driving further productivity gains across our stores
and supply chain, using technology to lower our overall cost to serve.
Finance expense
The net finance expense, including interest charged on lease liabilities,
reduced to £13.6m (FY23: £14.3m). Of this, £13.3m (FY23: £12.4m) related
to interest expense on lease liabilities.
Profit before tax (PBT)
Group statutory profit before tax was £105.7m (FY23: £122.5m), in part due
to a £12.4m YoY increase in non-underlying costs. In FY24 we incurred a total
of £26.3m of non-underlying costs (£26.2m operating costs, £0.1m interest),
of which £21.5m relates to the transition to our new distribution centre. In
FY23, non-underlying costs totalled £13.9m (£12.9m operating costs, £1.0m
interest), of which £11.1m related to our new DC.
Group underlying profit before tax was £132.0m(#) (FY23: £136.4m), with
underlying profit margin(3) of 8.9% (FY23: 9.7%), impacted by lower profits in
our retail business, offset by a significant step up in profits in our vet
business.
Retail statutory profit before tax was £64.8m (FY23: £87.7m). Retail
underlying profit before tax was £87.4m(#) (FY23: £98.8m) with underlying
profit margin(3) of 6.6% (FY23: 7.7%) reflecting the gross margin impacts
described above as food grew ahead of accessories, higher distribution costs
as we transitioned to our new DC, and increased colleague costs following the
9.7% National Living Wage increase in April.
Vet Group statutory profit before tax was £58.8m (FY23: £51.3m). Vet Group
underlying profit before tax was £61.6m(#) (FY23: £51.3m) with underlying
profit margin(3) of 42.0% (FY23: 40.9%), driven by ongoing strong sales
performance as we continue to improve clinical capacity.
Central costs of £17.9m (FY23: £16.5m) includes payroll costs for Group
functions, professional fees, and finance expenses. Underlying central costs
were £17.0m (FY23: £13.7m).
Taxation, profit after tax & EPS
Total tax expense was £26.5m for the period, an effective rate of 25%.
Statutory profit after tax decreased by 21.4% to £79.2m (FY23: £100.7m).
Statutory basic earnings per share (EPS) were 16.6 pence (FY23: 20.5 pence)
and underlying basic earnings per share(#) were 20.7 pence (FY23: 22.8 pence).
Working capital
The movement in working capital(4) for FY24 was an outflow of £4.6m (FY23:
£19.8m inflow) reflecting a more normalised working capital position. In the
prior year, working capital was supported by three main factors; growth in
GNFR payables relating to the timing of invoicing and project spend, a growth
in provisions built ahead of closing our legacy DCs, and a reduction in
receivables attributable to a significant decrease in operating loans due to
strong performance in our vets.
Inventories decreased by £11.1m YoY reflecting in part the unwind of the
stock position built ahead of the transition to our new DC last year, along
with tighter stock control.
Payables decreased by £5.3m YoY primarily driven by the reduction in
inventory position.
Receivables increased £6.3m YoY, partly driven by timing differences in
supplier-funded marketing activity. Within receivables, the strong financial
performance across our Joint Venture vet practices contributed to the gross
value of operating loans reducing by £5.0m to £8.8m from £13.8m at FY23
year end.
Investment
Capex was £42.9m (FY23: £75.3m) in the year as we continue to move past the
period of peak investment in our strategy.
Investment was focused on three strategic growth areas; £9.5m (FY23: £7.9m)
into digitising the business, a £6.4m (FY23: £43.7m) investment into our new
distribution centre, and £19.6m (FY23: £17.5m) to continue with our store
refit programme.
Capital investment in the year was below our original plan due to three
primary factors; the timing of our store development plan, as well as adopting
a more capital-light approach to store refits; opting for a lower cost, highly
efficient technology in our solar panel installation in our new DC; and a
change in phasing in investment regarding our new practice management system,
however total capital investment over the course of our medium-term plan is
unchanged at c£280m.
In addition, a £2.7m investment in vet practices, initially included in our
capex guidance, is now classified as investments. This relates to investments
in refits, extensions and advanced capabilities. The equivalent figure in
FY23, which was included within capex, was £0.4m.
Free cash flow
Free cash flow after interest and tax, but before acquisitions was £69.0m(#)
(FY23: £98.2m). The decrease in free cash flow compared with the prior year
primarily reflects the underlying profit decline, and the normalisation in
working capital, offset in part by lower capex as we move past our peak
investment phase.
Free cash flow(#) (£m) FY24 FY23
Net cash flow from operating activities 210.0 251.2
Lease payments(5 ) (68.4) (68.9)
Cash receipts from lease incentives - 22.0
Debt issue costs (0.9) (0.1)
Net cash capex(6) (48.5) (77.2)
Net interest(7) (12.4) (14.7)
Purchase of own shares for colleague share schemes (10.8) (14.1)
Free cash flow(#) 69.0 98.2
The cash and cash equivalents at the end of the period were £57.1m, down
£120.9m YoY (FY23: £178.0m).
Divisional free cash flow FCF (£m)
Retail 27.7
Vet Group 58.3
Central (16.9)
Group(#) 69.0
The cash generation described above, enables us to maintain our dividend
payment and fund the £50m share buyback programme completed in the year. Our
net cash position(#) at the end of the period was £8.8m (cash £57.1m, debt
£48.3m), and total indebtedness(#) was £372.0m post lease liabilities. This
represents a leverage ratio(#) of (0.1)x underlying EBITDA or 1.5x on a lease
adjusted basis.
Net cash (£m) FY24 FY23
Opening net cash(#) 54.7 66.0
Free cash flow(#) 69.0 98.2
Equity dividends paid (60.7) (58.7)
Share buyback (50.3) (50.3)
Acquisitions(8) (2.4) (0.5)
Disposals(9) (1.5) -
Closing net cash(#) 8.8 54.7
Pre IFRS 16 leverage(#) (0.1)x (0.3)x
Lease adjusted leverage(#) 1.5x 1.5x
1. Gross margin is calculated as gross profit as a percentage of revenue. Refer
to Note 1 of the accounts for an explanation of the prior year restatement.
2. Operating costs are the sum of selling and distribution expenses and
administrative expenses. Refer to Note 1 of the accounts for an explanation of
the prior year restatement.
3. Underlying profit margin is calculated as underlying profit before tax as a
percentage of revenue.
4. Working capital is the sum of YoY movements in trade and other receivables,
inventories, trade and other payables, and provisions.
5. Lease payments are cash payments for the principal portion of the right-of-use
lease liability.
6. Net cash capex is proceeds from the sale of property, plant and equipment less
costs to acquire right-of-use assets and acquisition of property, plant and
equipment and other intangible assets.
7. Net interest is interest received less interest paid, interest paid on lease
obligations, and debt issue costs.
8. FY24 includes £1.0m investment in Good Dog Food, £2.5m investment in joint
venture (JV) practices, £1.0m relating to the acquisition of JV practices,
offset by £2.1m proceeds from repayment of initial loans from JV partners.
9. FY24 disposals relates to the disposal of certain company managed practices as
we converted them to joint venture partnerships.
The Group's underlying cash return on invested capital (CROIC)(#) in the
period decreased to 19.4% (FY23: 22.7%) having been through a period of
heightened investment as we build our digital platform and bring our new DC
onstream, with the cash benefits to come in future years.
Capital allocation
Our capital allocation policy prioritises investing cash in areas that will
expand the Group and deliver attractive returns. These areas include organic
investment (into our digital capability, our infrastructure, and our store
refit program), our dividend policy (which approximates to 50% of earnings per
share) and value-accretive opportunities including M&A (which are
strategically aligned to expanding our platform in core and adjacent markets).
We will return to shareholders any surplus cash after these items, and it is
the Board's intention to review this on an annual basis. Having completed
£100m in share buybacks over the past two years, we have today announced a
further £25m buyback for the year ahead.
Dividend
The Board has recommended a final dividend of 8.3 pence per share, taking the
total dividend for the year to 12.8 pence per share. Dividends have been
maintained in the year despite the YoY decline in EPS, resulting in a payout
ratio of 61%. In the years ahead we will gradually move our payout ratio
closer to the 50% stated in our capital allocation policy. The final dividend
will be payable on 16 July 2024 to shareholders on the register at the close
of trading on 7 June 2024.
Mike Iddon
Chief Financial Officer
28 May 2024
Financial statements
Section 435 statement
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated balance sheet
Consolidated statement of changes in equity as at 28 March 2024
Consolidated statement of changes in equity as at 30 March 2023
Consolidated statement of cash flows
Company balance sheet
Company statement of changes in equity as at 28 March 2024
Company statement of changes in equity as at 30 March 2023
Company statement of cash flows
Notes (forming part of the financial statements)
Glossary - Alternative Performance Measures
Advisors and contacts
Section 435 statement
The financial information set out below does not constitute the company's
statutory accounts for the period ended 28 March 2024 or 30 March 2023 but is
derived from those accounts. Statutory accounts for 2023 have been delivered
to the registrar of companies, and those for 2024 will be delivered in due
course. The auditor has reported on those accounts; their reports were (i)
unqualified, (ii) did not include a reference to any matters to which the
auditor drew attention by way of emphasis without qualifying their report and
(iii) did not contain a statement under section 498 (2) or (3) of the
Companies Act 2006.
Consolidated income statement for the 52 week period ended 28 March 2024
Note 52 week period ended 28 March 2024 52 week period ended 30 March 2023 (restated) (1)
Underlying trading Non-underlying Total Underlying trading Non-underlying Total
£m items (note 3) £m £m items (note 3) £m
£m £m
Revenue 2 1,476.6 - 1,476.6 1,404.2 - 1,404.2
Cost of sales(2) (785.3) - (785.3) (729.6) - (729.6)
Gross profit 691.3 - 691.3 674.6 - 674.6
Selling and distribution expenses (442.2) (21.4) (463.6) (416.1) (10.1) (426.2)
Administrative expenses 3 (116.3) (4.8) (121.1) (121.0) (2.8) (123.8)
Other income 3 12.7 - 12.7 12.2 - 12.2
Operating profit 2,3 145.5 (26.2) 119.3 149.7 (12.9) 136.8
Financial income 6 4.0 - 4.0 2.7 - 2.7
Financial expense 7 (17.5) (0.1) (17.6) (16.0) (1.0) (17.0)
Net financing expense (13.5) (0.1) (13.6) (13.3) (1.0) (14.3)
Profit before tax 132.0 (26.3) 105.7 136.4 (13.9) 122.5
Taxation 8 (33.1) 6.6 (26.5) (24.4) 2.6 (21.8)
Profit for the period 98.9 (19.7) 79.2 112.0 (11.3) 100.7
(1) See notes 1.1 and 1.27 for an explanation of the prior year restatements.
(2) Impairment gains on receivables of £1.0m (52 weeks to 30 March 2023
£2.0m) are reported within cost of sales.
Basic and diluted earnings per share attributable to equity shareholders of
the Company:
Note 52 week period ended 28 March 2024 52 week period ended 30 March 2023
Equity holders of the parent - basic 5 16.6p 20.5p
Equity holders of the parent- diluted 5 16.4p 20.2p
( )
Dividends paid and proposed are disclosed in note 9.
The notes on pages 18 to 73 form an integral part of these financial
statements.
Consolidated statement of comprehensive income for the 52 week period ended 28
March 2024
Note 52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Profit for the period 79.2 100.7
Other comprehensive income
Items that are or may be recycled subsequently into profit or loss:
Foreign exchange translation differences 22 - (0.1)
Effective portion of changes in fair value of cash flow hedges 22 3.3 (10.6)
Net change in fair value of cash flow hedges reclassified to profit or loss 22 1.3 -
Other comprehensive income for the period, before income tax 4.6 (10.7)
Income tax on other comprehensive income 15,22 (0.3) 1.3
Other comprehensive income for the period, net of income tax 4.3 (9.4)
Total comprehensive income for the period 83.5 91.3
The notes on pages 18 to 73 form an integral part of these financial
statements.
Consolidated balance sheet at 28 March 2024
Note At 28 March 2024 £m At 30 March 2023 £m
Non-current assets
Property, plant and equipment 11 158.1 146.9
Right-of-use assets 12 319.3 359.6
Intangible assets 13 979.7 989.5
Deferred tax asset 15 - 1.9
Other non-current assets 16 10.9 10.9
1,468.0 1,508.8
Current assets
Inventories 14 97.5 108.6
Other financial assets 16 0.3 2.2
Trade and other receivables 17 60.9 51.8
Cash and cash equivalents 18 57.1 178.0
215.8 340.6
Total assets 1,683.8 1,849.4
Current liabilities
Trade and other payables 20 (249.2) (261.2)
Income tax payable (1.4) (0.3)
Other interest-bearing loans and borrowings 19 (2.2) (1.2)
Lease liabilities 12 (79.8) (83.3)
Provisions 21 (7.6) (3.9)
Other financial liabilities 16 (1.0) (3.7)
(341.2) (353.6)
Non-current liabilities
Other interest-bearing loans and borrowings 19 (43.3) (119.3)
Lease liabilities 12 (301.0) (338.1)
Provisions 21 (5.1) (12.9)
Deferred tax liabilities 15 (4.7) -
Other financial liabilities 16 - (0.4)
(354.1) (470.7)
Total liabilities (695.3) (824.3)
Net assets 988.5 1,025.1
Equity attributable to equity holders of the parent
Ordinary share capital 22 4.7 4.8
Consolidation reserve (372.0) (372.0)
Merger reserve 113.3 113.3
Translation reserve (0.1) (0.1)
Capital redemption reserve 0.3 0.2
Cash flow hedging reserve (0.5) (1.6)
Retained earnings 1,242.8 1,280.5
Total equity 988.5 1,025.1
On behalf of the Board:
Mike Iddon
Chief Financial Officer
28 May 2024
Company number: 08885072
The notes on pages 18 to 73 form an integral part of these financial
statements.
Consolidated statement of changes in equity as at 28 March 2024
Share capital Consolidation reserve Merger reserve Cash flow hedging reserve Translation reserve Capital redemption reserve Retained earnings Total equity
£m £m £m £m £m £m £m £m
Balance at 30 March 2023 4.8 (372.0) 113.3 (1.6) (0.1) 0.2 1,280.5 1,025.1
Total comprehensive income for the period
Profit for the period - - - - - - 79.2 79.2
Other comprehensive income (note 22) - - - 4.3 - - - 4.3
Total comprehensive income for the period - - - 4.3 - - 79.2 83.5
Hedging gains and losses reclassified to inventory - - - (3.2) - - - (3.2)
Total hedging gains and losses reclassified to inventory - - - (3.2) - - - (3.2)
Transactions with owners, recorded directly in equity
Equity dividends paid - - - - - - (60.7) (60.7)
Share-based payment charge - - - - - - 5.9 5.9
Deferred tax movement on IFRS2 reserve - - - - - - (1.0) (1.0)
Share buyback (0.1) - - - - 0.1 (50.3) (50.3)
Purchase of own shares - - - - - - (10.8) (10.8)
Total contributions by and distributions to owners (0.1) - - - - 0.1 (116.9) (116.9)
Balance at 28 March 2024 4.7 (372.0) 113.3 (0.5) (0.1) 0.3 1,242.8 988.5
Consolidated statement of changes in equity as at 30 March 2023
Share capital Consolidation reserve Merger reserve Cash flow hedging reserve Translation reserve Capital redemption reserve Retained earnings Total equity
£m £m £m £m £m £m £m £m
Balance at 31 March 2022 5.0 (372.0) 113.3 3.4 - - 1300.0 1,049.7
Total comprehensive income for the period
Profit for the period - - - - - - 100.7 100.7
Other comprehensive income (note 22) - - - (9.3) (0.1) - - (9.4)
Total comprehensive income for the period - - - (9.3) (0.1) - 100.7 91.3
Hedging gains and losses reclassified to inventory - - - 4.3 - - - 4.3
Total hedging gains and losses reclassified to inventory - - - 4.3 - - - 4.3
Transactions with owners, recorded directly in equity - -
Equity dividends paid - - - - - - (58.7) (58.7)
Share-based payment charge - - - - - - 4.9 4.9
Deferred tax movement on IFRS2 reserve - - - - - - (2.0) (2.0)
Share buyback (0.2) - - - - 0.2 (50.3) (50.3)
Purchase of own shares - - - - - - (14.1) (14.1)
Total contributions by and distributions to owners (0.2) - - - - 0.2 (120.2) (120.2)
Balance at 30 March 2023 4.8 (372.0) 113.3 (1.6) (0.1) 0.2 1,280.5 1,025.1
Consolidated statement of cash flows for the 52 week period ended 28 March
2024
52 week period 52 week period
ended ended
28 March 2024 30 March 2023
£m £m
Cash flows from operating activities
Profit for the period 79.2 100.7
Adjustments for:
Depreciation and amortisation 109.6 103.4
Financial income (4.0) (2.7)
Financial expense 17.6 17.0
Share-based payment charges 5.9 4.9
Taxation 26.5 21.8
234.8 245.1
(Increase) /Decrease in trade and other receivables (6.3) 3.4
Decrease/(Increase) in inventories 11.1 (24.1)
(Decrease)/Increase in trade and other payables (5.3) 36.9
(Decrease)/Increase in provisions (4.1) 3.6
Movement in working capital (4.6) 19.8
Tax paid (20.2) (13.7)
Net cash flow from operating activities 210.0 251.2
Cash flows from investing activities
Investments (3.5) -
Proceeds from repayment of initial loans 2.1 -
Interest received 4.1 2.7
Costs to acquire right-of-use assets (0.5) (1.9)
Acquisition of subsidiaries, net of cash acquired (1.0) (0.5)
Disposal of subsidiaries, net of cash disposed (1.5) 0.4
Acquisition of property, plant and equipment and other intangible assets (48.0) (75.7)
Net cash generated from in investing activities (48.3) (75.0)
Cash flows from financing activities
uEquity dividends paid (60.7) (58.7)
Proceeds from new loan - 123.3
Repayment of borrowings (75.0) (100.0)
Debt issue costs (0.9) (0.1)
Cash receipts from lease incentives - 22.0
Cash payments for the principal portion of the right-of-use lease liability (68.4) (68.9)
Purchase of own shares (10.8) (14.1)
Share buyback (50.3) (50.3)
Interest paid (3.2) (5.0)
Interest paid on lease obligations (13.3) (12.4)
Net cash used in financing activities (282.6) (164.2)
Net (decrease)/increase in cash and cash equivalents (120.9) 12.0
Cash and cash equivalents at beginning of period 178.0 166.0
Cash and cash equivalents at end of period 57.1 178.0
( )
The notes on pages 18 to 73 form an integral part of these financial
statements.
Company balance sheet at 28 March 2024
Note At 28 March 2024 £m At 30 March 2023 £m
Non-current assets
Investments in subsidiaries 28 936.2 936.2
Deferred tax asset 15 0.9 2.8
Trade and other receivables 17 663.3 578.4
1,600.4 1,517.4
Current assets
Other financial assets 16 - 2.0
Cash and cash equivalents 18 - 0.4
- 2.4
Total assets 1,600.4 1,519.8
Current liabilities
Trade and other payables 20 (816.3) (618.0)
(816.3) (618.0)
Non-current liabilities
Other interest-bearing loans and borrowings 19 (22.2) (97.3)
Other financial liabilities 16 - (0.4)
(22.2) (97.7)
Total liabilities (838.5) (715.7)
Net assets 761.9 804.1
Equity attributable to equity holders of the parent
Ordinary share capital 22 4.7 4.8
Merger reserve 113.3 113.3
Capital redemption reserve 0.3 0.2
Cash flow hedging reserve - 1.2
Retained earnings 643.6 684.6
Total equity 761.9 804.1
As permitted by section 408 of the Companies Act 2006, the Company's income
statement has not been included in these financial statements. The Company's
profit for the 52 week period ended 28 March 2024 was £75.9m (profit for the
52 week period ended 30 March 2023 was £33.4m).
On behalf of the Board:
Mike Iddon
Chief Financial Officer
28 May 2024
Company number: 08885072
The notes on pages 18 to 73 form an integral part of these financial
statements.
Company statement of changes in equity as at 28 March 2024
Share capital Merger reserve Cash flow hedging reserve Capital redemption reserve Retained earnings Total equity
£m £m £m £m £m £m
Balance at 30 March 2023 4.8 113.3 1.2 0.2 684.6 804.1
Total comprehensive income for the period
Profit for the period - - - - 75.9 75.9
Other comprehensive income - - (1.2) - - (1.2)
Total comprehensive income for the period - - (1.2) - 75.9 74.7
Transactions with owners,recorded directly in equity
Equity dividends paid - - - - 60.7) (60.7)
Share-based payment charge - - - - 5.9 5.9
Deferred tax movement on IFRS2 reserve - - - - (1.0) (1.0)
Share buyback (0.1) - - 0.1 (50.3) (50.3)
Purchase of own shares - - - - (10.8) (10.8)
Total contributions by and distributions to owners (0.1) - - 0.1 (116.9) (116.9)
Balance at 28 March 2024 4.7 113.3 - 0.3 643.6 761.9
Company statement of changes in equity as at 30 March 2023
Share capital Merger reserve Cash flow hedging reserve Capital redemption reserve Retained earnings Total equity
£m £m £m £m £m £m
Balance at 31 March 2022 5.0 113.3 1.3 - 771.4 891.0
Total comprehensive income for the period
Profit for the period - - - - 33.4 33.4
Other comprehensive income - - (0.1) - - (0.1)
Total comprehensive income for the period - - (0.1) - 33.4 33.3
Transactions with owners, recorded directly in equity
Equity dividends paid - - - - (58.7) (58.7)
Share-based payment charge - - - - 4.9 4.9
Deferred tax movement on IFRS2 reserve - - - - (2.0) (2.0)
Share buyback (0.2) - - 0.2 (50.3) (50.3)
Purchase of own shares - - - - (14.1) (14.1)
Total contributions by and distributions to owners (0.2) - - 0.2 (120.2) (120.2)
Balance at 30 March 2023 4.8 113.3 1.2 0.2 684.6 804.1
Company statement of cash flows for the 52 week period ended 28 March 2024
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Cash flows from operating activities
Profit for the period 75.9 33.4
Adjustments for:
Financial expense 1.2 1.5
Share-based payment charges 5.9 4.9
Taxation (2.3) (3.0)
80.7 36.8
Increase in trade and other payables 208.8 62.8
Tax (paid)/received (6.0) 3.5
Net cash flow from operating activities 283.5 103.1
Cash flows from investing activities
(Increase)/Decrease in amounts owed by group undertakings (85.0) 21.9
Net cash generated from investing activities (85.0) 21.9
Cash flows from financing activities
Equity dividends paid (60.7) (58.7)
Proceeds from new loan - 100.0
Repayment of borrowings (75.0) (100.0)
Debt issue costs (0.9) -
Share buyback (50.3) (50.3)
Interest paid (1.2) (1.5)
Purchase of own shares (10.8) (14.1)
Net cash used in financing activities (198.9) (124.6)
Net (decrease)/increase in cash and cash equivalents (0.4) 0.4
Cash and cash equivalents at beginning of period 0.4 -
Cash and cash equivalents at end of period - 0.4
Notes (forming part of the financial statements)
Pets at Home Group Plc (the Company) is a company incorporated in the United
Kingdom and its registered office is Epsom Avenue, Stanley Green, Handforth,
Cheshire, SK9 3RN.
1 Significant accounting policies
The accounting policies set out below have, unless otherwise stated, been
applied consistently to all periods presented in these consolidated financial
statements.
1.1 Basis of preparation
The consolidated financial statements were prepared in accordance with UK
adopted international accounting standards and applicable law. The Company's
financial statements have been prepared in accordance with UK adopted
international accounting standards (UK-adopted IFRS) as applied in accordance
with the provisions of the Companies Act 2006. The Company has taken advantage
of the exemption provided under section 408 of the Companies Act 2006 not to
publish its individual income statement and related notes.
New standards and interpretations issued by the International Accounting
Standards Board (IASB) and the International Financial Reporting
Interpretations Committee (IFRIC) becoming effective during the 52 week period
ended 28 March 2024 have not had a material impact on the Group's financial
statements, these include IAS 8 amendments and IAS 1 amendments on
current/non-current classification of liabilities.
The group has assessed the impact of IFRS 17 (Insurance Contracts) which is
effective for annual reporting periods beginning on or after 1 January 2023.
The group has deemed the standard does not have a material impact on the Group
due to the income in relation to insurance contracts being immaterial.
The Group has adopted International Tax Reform - Pillar Two Model Rules
(Amendments to IAS 12). The amendments provide a temporary mandatory exception
from deferred tax accounting for the top-up tax, which is effective
immediately, and require new disclosures about the Pillar Two exposure. As the
Group is headquartered in the UK where profits are taxed at a rate higher than
the global minimum rate of 15% and the only overseas operations are in Hong
Kong where any profit arising is taxed at a rate higher than 15%, it is not
considered that the BEPs Pillar 2 has have any impact on the tax position of
the Group.
The Directors have restated the presentation of the segmental reporting
disclosures in Note 2 to reflect the fact that the veterinary telehealth
business is now reported within the Vet Group reporting segment. In the 52
week period ended 30 March 2023 the telehealth business was reported within
the Central segment. As a result, £2.7m of revenue, £1.3m of gross profit
and £0.4m at an operating profit level have been reclassified from Central
segment to the Vet Group segment.
1.2 Measurement convention
The consolidated financial statements are prepared on the historical cost
basis except that the following assets and liabilities are stated at their
fair value: derivative financial instruments, financial instruments classified
as fair value through the profit or loss. Non-current assets held for sale are
stated at the lower of previous carrying amount and fair value less costs to
sell.
1.3 Going concern
The Group and Company's business activities, together with the factors likely
to affect its future development, performance and position, are set out in the
Strategic Report. The financial position of the Group and Company, its cash
flows, liquidity position and borrowing facilities are described in the Chief
Financial Officer's review. In addition, note 23 to the financial statements
includes the Group and Company's objectives, policies and processes for
managing its capital; its financial risk management objectives; details of its
financial instruments and hedging activities; and its exposures to credit risk
and liquidity risk.
The Directors of the Group have prepared cash flow forecasts for a period of
at least 12 months from the date of the approval of these financial statements
which indicate that, despite taking account of reasonably possible downsides,
the Group will have sufficient funds, through its revolving credit facility,
to meet its liabilities as they fall due for that period.
In preparing the forecasts for the Group, the Directors have carefully
considered the impact of consumer confidence, geopolitical tensions and the
actual and potential impact on supply chains, as well as energy cost inflation
on liquidity and future performance. The Group has also considered the impact
of climate change and the Task Force on Climate Related Financial Disclosures
('TCFD') scenario analysis conducted in undertaking this assessment.
The Group has access to a revolving credit facility of £300m which expires on
30 September 2028 and a £26.0m asset backed loan which expires on 27 March
2030. The Group has £48.3m drawn down at 28 March 2024 and cash balances of
£57.1m. The lowest level of headroom forecast over the next 12 months from
the date of signing of the financial statements is in excess of £342.0m in
the base case scenario. On a sensitised basis, the lowest level of headroom
forecast over the next 12 months from the date of approving of the financial
statements is £332.9m due to the removal of the dividend payment in an
extreme scenario.
The Group has been in compliance with all covenants applicable to this
facility within the financial year and is forecast to continue to be in
compliance for 12 months from the date of signing of the financial statements.
A number of severe but plausible downside scenarios were calculated compared
to the base case forecast of profit and cash flow to assess headroom against
facilities for the next 12 months. These scenarios included:
- Scenario 1: Reduction on Group like-for-like sales growth assumptions of 1% in
each year throughout the forecast period, but ordinary dividends continue to
be paid.
- Scenario 2: Using scenario 1 outcomes and further impacted by a conflated risk
impact of £36.0m on sales and £14.7m on PBT per annum (using specific
financial risks taken from Group risk register with sales and PBT financial
impact quantified), with dividends held at 12.8p per share per annum.
- Scenario 3: Group like-for-like sales growth declines to 0% in each year and a
conflated risk impact of £115.0m on sales and £46.9m on PBT is applied
(using the top risks from Group risk register with sales and PBT impact
quantified), with dividends cut to nil to conserve cash.
Against these negative scenarios, adjusted projections showed no breach of
covenants. Further mitigating actions could also be taken in such scenarios
should it be required, including reducing capital expenditure.
Despite net current liabilities of £125.4m at Group level and £816.3m in the
Company, the Directors of Pets at Home Group Plc, having made appropriate
enquiries including the principal risks and uncertainties on page 23, consider
that the Group and Company will have sufficient funds to continue to meet
their liabilities for a period of at least 12 months from the date of approval
of these financial statements and that, therefore, it is appropriate to adopt
the going concern basis in preparing the Group consolidated financial
statements and the Company only financial statements as at and for the period
ended 28 March 2024.
Notes (forming part of the financial statements) continued
1 Significant accounting policies (continued)
1.4 Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an
entity when it is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns
through its power over the entity. In assessing control, the Group takes into
consideration potential voting rights that are currently exercisable. The
acquisition date is the date on which control is transferred to the acquirer.
The financial statements of subsidiaries are included in the consolidated
financial statements from the date that control commences until the date that
control ceases. Losses applicable to the non-controlling interests in a
subsidiary are allocated to the non-controlling interests even if doing
so causes the non-controlling interests to have a deficit balance.
The Group and Company operate an Employee Benefit Trust (EBT) for the purposes
of acquiring shares to fund share awards made to employees. The EBT is deemed
to be a subsidiary of the Group and Company as Pets at Home Group Plc is
considered to be the ultimate controlling party for accounting purposes. The
assets and liabilities of this trust have been included in the consolidated
financial information. The cost of purchasing own shares held by the EBT is
accounted for in retained earnings.
Investment in Joint Venture veterinary practices
The Group has a number of non-participatory shareholdings in veterinary
practice companies, which are accounted for as Joint Venture arrangements. The
veterinary practices were established under terms that require mutual
agreement between the Group and the Joint Venture Partner, and do not give
the Group power over decision making, nor joint control, to affect its
exposure to, or the extent of, the returns from its involvement with the
practices and therefore are not consolidated in these financial statements.
Further, the Group is not entitled to profits, losses, or any surplus on
winding up or disposal of the Joint Venture veterinary practices, and as
such no participatory interest is recognised. The Group's category of
shareholding in the Joint Venture veterinary practices entitles the Group to
charge management fees for support services provided. For further details see
notes 16, 17 and 27. The Group's shares are non-participatory, and therefore
the Group does not share in any profits, losses or other distribution of value
from the Joint Venture company; the investments are held at cost less
impairment, which is deemed to be their carrying value as explained further in
note 16.
1.5 Foreign currency
Transactions in foreign currencies are translated to the respective functional
currencies of Group entities at the foreign exchange rate ruling at the date
of the transaction. Monetary assets and liabilities denominated in foreign
currencies at the balance sheet date are retranslated to the functional
currency at the foreign exchange rate ruling at that date. Foreign exchange
differences arising on translation are recognised in the income statement.
Non-monetary assets and liabilities that are measured in terms of historical
cost in a foreign currency are translated using the exchange rate at the date
of the transaction. Non-monetary assets and liabilities denominated in foreign
currencies that are stated at fair value are retranslated to the functional
currency at foreign exchange rates ruling at the dates the fair value was
determined.
The assets and liabilities of foreign operations, including goodwill and fair
value adjustments arising on consolidation, are translated to the Group's
presentational currency, sterling, at foreign exchange rates ruling at the
balance sheet date. The revenues and expenses of foreign operations are
translated at an average rate for the period where this rate approximates to
the foreign exchange rates ruling at the dates of the transactions. Exchange
differences arising from this translation of foreign operations are reported
as an item of other comprehensive income and accumulated in the translation
reserve or non-controlling interest, as the case may be.
Functional currency
The consolidated financial statements are presented in sterling which is the
functional currency of the parent company and the presentational currency of
the Group and Company, these have been rounded to the nearest £0.1m.
1.6 Classification of financial instruments issued by the Group
Following the adoption of IAS32, financial instruments issued by the Group are
treated as equity only to the extent that they meet the following
two conditions:
(a) they include no contractual obligations upon the Company (or Group as
the case may be) to deliver cash or other financial assets or to exchange
financial assets or financial liabilities with another party under conditions
that are potentially unfavourable to the Company (or Group); and
(b) where the instrument will or may be settled in the Company's own
equity instruments, it is either a non-derivative that includes no obligation
to deliver a variable number of the Company's own equity instruments or is a
derivative that will be settled by the Company exchanging a fixed amount of
cash or other financial assets for a fixed number of its own equity
instruments.
To the extent that this definition is not met, the proceeds of issue are
classified as a financial liability.
1.7 Non-derivative financial instruments
Non-derivative financial instruments comprise investments in equity and debt
securities, trade and other receivables, cash and cash equivalents,
interest-bearing borrowings, and trade and other payables.
Trade and other receivables
Trade and other receivables are recognised initially at fair value. Subsequent
to initial recognition they are measured at amortised cost using
the effective interest method, less any expected credit loss.
Trade and other payables
Trade and other payables are recognised initially at fair value. Subsequent to
initial recognition they are measured at amortised cost using the effective
interest method.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank
overdrafts that are repayable on demand and form an integral part of the
Group's cash management are included as a component of cash and cash
equivalents for the purposes of the cash flow statement and are only offset
for balance sheet purposes where the offsetting criteria are met.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair value, net of
attributable transaction costs. Subsequent to initial recognition,
interest-bearing borrowings are stated at amortised cost using the effective
interest method.
Contingent consideration
Contingent consideration on acquisition or disposal of a subsidiary is valued
at fair value at the time of acquisition or disposal. Any subsequent change in
fair value is recognised in profit or loss (see 1.13).
Notes (forming part of the financial statements) continued
1 Significant accounting policies (continued)
1.8 Derivative financial instruments and hedging
Derivative financial instruments
Derivative financial instruments are recognised at fair value. The gain or
loss on remeasurement to fair value is recognised immediately in profit
or loss. However, where derivatives qualify for hedge accounting, recognition
of any resultant gain or loss depends on the nature of the item being hedged
(see below).
Cash flow hedges
Where a derivative financial instrument is designated as a hedge of the
variability in cash flows of a recognised asset or liability, or a highly
probable forecast transaction, the effective part of any gain or loss on the
derivative financial instrument is recognised directly in the hedging reserve.
Any ineffective portion of the hedge is recognised immediately in the income
statement.
If a hedge of a forecast transaction subsequently results in the recognition
of a financial asset or a financial liability, the associated gains and losses
that were recognised directly in equity are reclassified into profit or loss
in the same period or periods during which the asset acquired or liability
assumed affects profit or loss, i.e. when interest income or expense is
recognised.
When the hedged forecast transaction subsequently results in the recognition
of a non-financial item such as inventory, the amount accumulated in the
hedging reserve and the cost of hedging is included directly in the initial
cost of the non-financial item when it is recognised. For all other hedging
forecast transactions, the amount accumulated in the hedging reserve and the
cost of hedging is reclassified to profit or loss in the same period or
periods during which the hedged expected future cash flows affect the profit
or loss.
For cash flow hedges, other than those covered by the preceding two policy
statements, the associated cumulative gain or loss is removed from equity and
recognised in the income statement in the same period or periods during which
the hedged forecast transaction affects profit or loss.
When a hedging instrument expires or is sold, terminated or exercised, or the
entity revokes designation of the hedge relationship but the hedged forecast
transaction is still expected to occur, the cumulative gain or loss at that
point remains in equity and is recognised in accordance with the above policy
when the transaction occurs. If the hedged transaction is no longer expected
to take place, the cumulative unrealised gain or loss recognised in equity is
recognised in the income statement immediately.
1.9 Intra-group financial instruments
Financial guarantee contracts to guarantee the indebtedness of companies
within the Group are considered to be insurance arrangements and accounted for
as such. In this respect, the Group treats the guarantee contract as a
contingent liability until such time as it becomes probable that a payment
will be required under the guarantee, see note 26.
1.10 Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation
and accumulated impairment losses. Where parts of an item of property, plant
and equipment have different useful lives, they are accounted for as separate
items of property, plant and equipment.
Depreciation is charged to the income statement on a straight-line basis over
the estimated useful lives of each part of an item of property,
plant and equipment. Land and assets under contruction are not depreciated.
The estimated useful lives are as follows:
Freehold property - 50 years
Fixtures, fittings, tools and equipment - 3-20 years
Leasehold improvements - the terms of the lease
Depreciation methods, useful lives and residual values are reviewed at each
balance sheet date.
The impact of climate change, particularly in the context of risks identified
in the Task Force on Climate Related Financial Disclosures ('TCFD') scenario
analysis have been considered and no material impact on the carrying value,
useful lives or residual values have been identified.
1.11 Intangible assets
Intangible assets acquired in a business combination
Intangible assets acquired in a business combination and recognised separately
from goodwill are initially recognised at their fair value
at the acquisition date (which is regarded as their cost).
Subsequent to initial recognition, intangible assets acquired in a business
combination are reported at cost less accumulated amortisation
and accumulated impairment losses, on the same basis as intangible assets
that are acquired separately.
Customer lists are valued based on the forecast net present value of the
future economic relationship with those customers, adjusted for forecast
retention rates. Technology based 'know how' assets are valued based on the
expected cost to reproduce or replace the asset, adjusted for the physical
deterioration and functional or economic obsolescence, if present and
measurable. Software is stated at cost less accumulated amortisation.
Amortisation is charged to the income statement on a straight-line basis over
the estimated useful life of an asset. The estimated useful lives are as
follows:
Software 2 to 7 years
Customer lists 10 years
Technology based know how 10 years
Amortisation methods, useful lives and residual values are reviewed at each
balance sheet date.
Expenditure on Software as a Service ('SaaS') customisation and configuration
that is distinct from access to the cloud software can only be capitalised to
the extent it gives rise to an asset, i.e. where the Group has the power to
obtain the future economic benefits and can restrict others' access to those
benefits, otherwise such expenditure in relation to developing SaaS for use is
expensed.
The impact of climate change, particularly in the context of risks identified
in the Task Force on Climate Related Financial Disclosures ('TCFD') scenario
analysis have been considered and no material impact on the carrying value,
useful lives or residual values have been identified.
Notes (forming part of the financial statements) continued
1 Significant accounting policies (continued)
1.12 Leases
On completion of a lease, the Group recognises a right-of-use asset,
representing its right to use the underlying asset and a lease liability,
representing its obligation to make lease payments. The lease liability is
measured at the present value of the lease payments over the term of the
lease, discounted using the interest rate implicit in the lease, or if that
rate cannot be readily determined, the Group's incremental borrowing
rate. The rate implicit in the lease cannot be readily determined and
therefore a rate based on the Group's incremental borrowing rate is
used. This rate is adjusted to take into account the risk associated with the
length of the lease. Lease payments will include any fixed payments, including
as a result of stepped rent increases.
The right-of-use asset is measured at cost, which comprises the initial amount
of the lease liability adjusted for any lease payments made at or before the
lease commencement date and any lease incentives received or premiums paid. In
the 52 weeks ending 30 March 2023 the Group received a lease incentive of
£22.0m in relation to the new distribution centre (2024: £nil). The cash
received was included within cash flows from financing activities in FY23 on
the basis that it was associated with the payments for the lease liability.
The Group has lease contracts in relation to property and equipment. There are
recognition exemptions for low-value assets and short-term leases with a lease
term of 12 months or less. Any leases under a short-term licence agreement are
excluded as they fall into the lease term of 12 months or less. The Group
recognises the lease payments associated with these leases as an expense on a
straight-line basis over the term of the lease. The total value of leases
where the Group has taken a recognition exemption is disclosed in note 12.
The Group has a small number of leases where it is an intermediate lessor. For
these leases, it accounts for the interest in the head lease and sub-lease
separately. It assesses the lease classification of the sub-lease with
reference to the right-of-use asset arising from the head lease, not with
reference to the underlying asset.
The Group currently receives rental income from related Joint Venture
veterinary practices which are located within the Group's retail
stores. These rental incomes are disclosed in note 3. Under IFRS16, the lease
classification of sub-leases is assessed by reference to the right-of-use
asset under the head lease rather than the underlying asset. This rental
income is presented in other income in the Consolidated Income Statement.
Right-of-use assets may be impaired if the lease becomes onerous. Impairment
costs would be charged to administrative expenses if this occurred.
1.13 Business combinations
Business combinations are accounted for by applying the acquisition method as
at the acquisition date, which is the date on which control is transferred to
the Group.
Acquisitions on or after 26 March 2010
For acquisitions on or after 26 March 2010, the Group measures goodwill at the
acquisition date as:
• the fair value of the consideration transferred; plus
• the recognised amount of any non-controlling interests in the acquiree; plus
• the fair value of the existing equity interest in the acquiree; less
• the net recognised amount (generally fair value) of the identifiable assets
acquired and liabilities assumed.
When the excess is negative, a bargain purchase gain is recognised immediately
in profit or loss.
Costs related to the acquisition, other than those associated with the issue
of debt or equity securities, are expensed as incurred.
Any contingent consideration payable is recognised at fair value at the
acquisition date. If the contingent consideration is classified as equity,
it is not remeasured, and settlement is accounted for within equity.
Otherwise, subsequent changes to the fair value of the contingent
consideration are recognised in profit or loss. If contingent consideration is
payable and is dependent on future employment, it is recognised as an expense
over the relevant period as a cost of continuing employment. Any contingent
deferred consideration receivable is recognised at fair value.
On a transaction-by-transaction basis, the Group elects to measure
non-controlling interests, which have both present ownership interests and are
entitled to a proportionate share of net assets of the acquiree in the event
of liquidation, either at its fair value or at its proportionate interest in
the recognised amount of the identifiable net assets of the acquiree at the
acquisition date. All other non-controlling interests are measured at their
fair value at the acquisition date.
Acquisitions prior to 26 March 2010 (date of adoption of IFRS)
IFRS1 grants certain exemptions from the full requirements of Adopted IFRS for
first time adopters. In respect of acquisitions prior to 26 March 2010,
goodwill is included on the basis of its deemed cost.
1.14 Assessment of control with regard to Joint Ventures
The Group has assessed, and continually assesses, whether the level of an
individual Joint Venture veterinary practice's indebtedness to the Group,
particularly those with high levels of indebtedness, implies that the Group
has the practical ability to control the Joint Venture, which would result in
the requirement to consolidate. In making this judgement, the Group reviewed
the terms of the Joint Venture agreement and the question of practical
ability, as a provider of working capital to control the activities of the
practice. This included consideration of barriers to the Group's ability to
exercise such practical or other control which include difficulty in replacing
Joint Venture Partners due to the shortage of veterinarians in the UK and
reputational damage within the veterinary network should the Group attempt to
exercise control, as well as potential barriers to the Joint Venture Partner
exercising their own power over the activities of the practice. We note that
under the terms of the Joint Venture agreement, the partners run their
practices with complete operational and clinical freedom. The Group is
satisfied that on the balance of evidence from the Group's experience as
shareholder and provider of working capital support to the practices, it does
not have the current ability to exercise control over those practices to which
operating loans are advanced, and therefore non consolidation is appropriate.
1.15 Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is
based on the weighted average cost principle and includes expenditure incurred
in acquiring the inventories, production or conversion costs and other costs
in bringing them to their existing location and condition, less rebates and
discounts.
Provision is made against specific inventory lines where market conditions
identify an issue in recovering the full cost of that Stock Keeping Unit
('SKU'). The provision focuses on the age of inventory and the length of time
it is expected to take to sell and applies a progressive provision against the
gross inventory based on the numbers of days' stock on hand. Where necessary,
further specific provision is made against inventory lines, where the
calculated provision is not deemed sufficient to carry the inventory at net
realisable value.
Notes (forming part of the financial statements) continued
1 Significant accounting policies (continued)
1.15 Inventories (continued)
To the extent that the ageing profile of gross inventory as calculated by this
provision methodology results in a material provision, it will be disclosed as
an estimate that may have an impact on subsequent periods. To the extent this
is material, it will be disclosed in note 1.22.
1.16 Impairment excluding inventories and deferred tax assets
Financial assets (including receivables)
Measurement of Expected Credit Losses ('ECLs') and definition of default
ECLs are a probability-weighted estimate of credit losses. Credit losses are
measured as the present value of all cash shortfalls (i.e. the difference
between the cash flows due to the Group in accordance with the contract and
the cash flows that the Group expects to receive). ECLs are discounted at the
effective interest rate of the financial asset.
The definition of default is applicable to intercompany and related party
receivables but not relevant to trade receivables where the lifetime expected
credit loss is considered. The Group considers Joint Venture receivables
(operating loans) to be in default when the underlying veterinary practice is
significantly under-performing against its business plan, assessed based on
future cashflow forecasts for the individual practices which utilise
consistent assumptions across all practices. Any shortfall in repayment of the
Joint Venture loans and receivables following the 10-year forecast period are
considered to be in default as repayment is expected during this time. Loss
given default is also determined based on the forecast shortfall amount. Those
within the performing credit risk category are deemed to have low credit risk.
Practices categorised within the in default credit risk categories are those
considered to be in default based on their cashflow forecast. Significant
increase in credit risk is not applicable to Joint Venture operating loans due
to the on-demand payment terms.
The Group considers initial set up loans to Joint Ventures to be in default
when the loan remains outstanding once the practice has reached 15 years of
age. These loans have no set repayment date but are expected to be recovered
within 15 years. Significant increase in credit risk is defined as any
practice which has an operating loan which is in default as defined above. All
other loans are considered to be performing and have low credit risk.
The Group considers other intercompany and related party assets to be in
default when the entity does not have the forecasted future funds available to
repay the balance, if recalled.
Credit-impaired financial assets
At each reporting date, the Group assesses whether financial assets carried at
amortised cost and debt securities at FVOCI are credit-impaired. A financial
asset is 'credit-impaired' when one or more events that have a detrimental
impact on the estimated future cash flows of the financial asset have
occurred.
Write-offs
The gross carrying amount of a financial asset is written off (either
partially or in full) to the extent that there is no realistic prospect of
recovery. Details of these provisions are explained in note 16.
Non-financial assets
The carrying amounts of the Group's non-financial assets, other than
inventories and deferred tax assets, are reviewed at each reporting date to
determine whether there is any indication of impairment. If any such
indication exists, then the asset's recoverable amount is estimated. For
goodwill, and intangible assets that have indefinite useful lives or that are
not yet available for use, the recoverable amount is estimated each period at
the same time.
The recoverable amount of an asset or cash-generating unit as defined by IAS36
is the greater of its value in use and its fair value less costs to sell. In
assessing value in use, the estimated future cash flows are discounted to
their present value using a post-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the
asset. For the purpose of impairment testing, assets that cannot be tested
individually are grouped together into the smallest group of assets that
generates cash inflows from continuing use that are largely independent of the
cash inflows of other assets or groups of assets (the 'cash-generating unit').
The goodwill acquired in a business combination, for the purpose of impairment
testing, is allocated to cash-generating units ('CGUs'). Subject to an
operating segment ceiling test, for the purposes of goodwill impairment
testing, CGUs to which goodwill has been allocated are aggregated so that the
level at which impairment is tested reflects the lowest level at which
goodwill is monitored for internal reporting purposes. Goodwill acquired in a
business combination is allocated to groups of CGUs that are expected to
benefit from the synergies of the combination.
An impairment loss is recognised if the carrying amount of an asset or its CGU
exceeds its estimated recoverable amount. Impairment losses are recognised in
profit or loss. Impairment losses recognised in respect of CGUs are allocated
first to reduce the carrying amount of any goodwill allocated to the units,
and then to reduce the carrying amounts of the other assets in the unit (group
of units) on a pro rata basis.
An impairment loss in respect of goodwill is not reversed. In respect of other
assets, impairment losses recognised in prior periods are assessed at each
reporting date for any indications that the loss has decreased or no longer
exists. An impairment loss is reversed if there has been a change in the
estimates used to determine the recoverable amount. An impairment loss is
reversed only to the extent that the asset's carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or
amortisation, if no impairment loss had been recognised.
1.17 Employee benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which the
Group pays fixed contributions into a separate entity and will have no legal
or constructive obligation to pay further amounts. Obligations for
contributions to defined contribution pension plans are recognised as an
expense in the income statement in the periods during which services are
rendered by employees.
Short term benefits
Short term employee benefit obligations are measured on an undiscounted basis
and are expensed as the related service is provided. A liability is recognised
for the amount expected to be paid under short-term cash bonus or
profit-sharing plans if the Group has a present legal or constructive
obligation to pay this amount as a result of past service provided by the
employee and the obligation can be estimated reliably.
Share-based payments
A number of employees of the Company's subsidiaries (including Directors)
receive an element of remuneration in the form of share-based payments,
whereby employees render services in exchange for shares in Pets at Home Group
Plc or rights over shares.
Notes (forming part of the financial statements) continued
1 Significant accounting policies (continued)
1.17 Employee benefits (continued)
Share-based payments are measured at fair value at the date of grant. The fair
value of transactions involving the granting of shares is determined by the
share price at the date of grant. The fair value of transactions involving the
granting of share options is calculated by an external valuer based on a
binomial model. In valuing share-based payments, no account is taken of any
performance conditions, other than conditions linked to the price of the
shares of Pets at Home Group Plc ('market conditions').
The cost of share-based payments is recognised, together with a corresponding
increase in equity, on a straight-line basis over the vesting period based on
the Company's estimate of how many of the awards will eventually vest. No
expense is recognised for awards that do not ultimately vest, except for
awards where vesting is conditional upon a market condition, which are treated
as vesting irrespective of whether or not the market condition is satisfied,
provided that all other performance conditions are satisfied. Where the terms
of a share-based payment award are modified, as a minimum, an expense is
recognised as if the terms had not been modified. In addition, an expense is
recognised for any increase in the value of the transaction as a result of the
modification, as measured at the date of the modification.
Where a share-based payment award is cancelled, it is treated as if it had
vested on the date of cancellation and any expense not yet recognised for the
award is recognised immediately. However, if a new award is substituted for
the cancelled award and designated as a replacement award on the date that it
is granted, the cancelled and new awards are treated as if they were a
modification to the original award, as described in the previous paragraph.
The dilutive effect of outstanding options is reflected as additional share
dilution in the computation of diluted earnings per share.
Employee Benefit Trust
The assets and liabilities of the Employee Benefit Trust ('EBT') have been
included in the Group and Company accounts. The assets of the EBT are held
separately from those of the Company. Neither the purchase nor sale of own
shares leads to a gain or loss being recognised in the Group consolidated
statement of comprehensive income.
Investments in the Company's own shares held by the EBT are presented as a
deduction from reserves and the number of such shares is deducted from the
number of shares in issue when calculating the diluted earnings per share. The
trustees of the holdings of Pets at Home Group Plc shares under the Pets at
Home Group Employee Benefit Trust have waived or otherwise foregone any and
all dividends paid.
1.18 Provisions
A provision is recognised in the balance sheet when the Group has a present
legal or constructive obligation as a result of a past event, that can
be reliably measured and it is probable that an outflow of economic benefits
will be required to settle the obligation. Provisions are determined by
discounting the expected future cash flows at a pre-tax rate that reflects
risks specific to the liability.
1.19 Revenue and cost of sales
Revenue represents the total amount receivable for goods and services, net of
discounts, coupons, returns and excluding value added tax, sold in the
ordinary course of business, and arises substantially from activities in the
United Kingdom.
Revenue is recognised when the Group transfers control of goods or services to
a customer at the amount to which the Group expects to be entitled, and
substantially all of the Group's performance obligations have been fulfilled.
Depending on whether certain criteria are met, revenue is recognised either
over time, in a manner that best reflects the Group's performance, or at a
point in time, when control of the goods or services is transferred to the
customer.
Sale of goods in-store and online
Retail revenue from the sale of goods is recorded net of value added tax,
colleague discounts, coupons, vouchers, returns and the free element of
multi-save transactions. Sale of goods represents food and accessories sold
in-store and online, with revenue recognised at the point in time the customer
obtains control of the goods and substantially all of the Group's performance
obligations have been fulfilled, which is when the transaction is completed
in-store and at point of delivery to the customer for online orders. Revenue
is adjusted to account for estimates for anticipated returns and a provision
is recognised within trade and other payables. Estimates for anticipated
returns are calculated using past data for both in-store and online
transactions. No separate asset has been recognised (with no corresponding
adjustment to cost of sales) in relation to the value of products to be
recovered from the customer as the products are not always in a resaleable
condition.
Gift vouchers and cards
Revenue from the sale of gift vouchers and cards is deferred until the voucher
is redeemed, at which point performance obligations have been fulfilled. In
line with IFRS15 the value of revenue deferred is based on expected redemption
rates. The Group continues to assess the appropriateness of the expected
redemption rates against actual redemptions.
Pets Club loyalty scheme
Under the Pets Club loyalty scheme, points are earned by customers upon the
purchase of goods and services. These points can be converted by nominated
charities into gift cards for redemption against goods and services in-store
and online. The sales value of the points earned under the Petc Club scheme
are treated as deferred income; the sales are only recognised once the points
have been redeemed by the charities, at which point performance obligations
have been fulfilled. The points do not expire and have no value to the
customer.
Subscription orders
Revenue for subscription orders is recognised at the point of delivery of each
incremental order to the customer at which point performance obligations have
been fulfilled. Subscription services primarily relate to the repeat order of
products sold online and in-store.
Provision of services
Revenue from the provision of services is recorded net of value added tax,
colleague discounts, coupons and vouchers. Provision of services represents
veterinary group income, grooming revenue and insurance commissions, with
revenue recognised upon provision of the service to the customer at the point
at which the Group has substantially fulfilled its performance obligations.
Notes (forming part of the financial statements) continued
1 Significant accounting policies (continued)
1.19 Revenue and cost of sales (continued)
3) Veterinary Group income
Veterinary Group income represents revenue recognised at a point in time from
the provision of veterinary services from Company managed practices and income
from the provision of administrative support services to Joint Venture
veterinary practices. Revenue received for the provision of veterinary
services is recognised at the point of provision of the service and is
recognised net of value added tax, colleague discounts, coupons and vouchers.
Fee income received from the Joint Venture veterinary practice companies
for administrative support services is recognised in the period the services
relate to and recorded net of value added tax. Fee income received from Joint
Venture companies in relation to network purchasing arrangements is recognised
as the contractual commitments are fulfilled to create an entitlement to the
revenue. The Group also receives revenue in relation to business development
for the Joint Venture companies and recognises this within operating income.
Revenue derived from care plans is recognised on an apportioned basis relative
to delivery of the service. Revenue on annual 'Complete Care' plans is
deferred and recognised at the point at which treatment and/or services are
provided against the plan at an amount that reflects the consideration to
which the entity expects to be entitled in exchange for those goods or
services. Once the plan has expired, any unutilised deferred revenue will be
recognised as revenue. Revenue from 'Vac4Life' plans is deferred when payment
is received and then recognised in reducing proportions over the first three
years of the plan when vaccinations/boosters are provided.
Revenue derived from the veterinary telehealth business ('TVC') is recognised
over time on a pro-rated basis over the period the customers have access to
the telehealth service through subscriptions.
Rental income received from in-store Joint Venture veterinary practices is
disclosed within note 3 and is categorised as other income.
ii) Grooming revenue
Grooming revenue is recognised net of value added tax, colleague discounts,
coupons and vouchers, at the point of provision of the service to the
customer. Deposits received are deferred until the grooming service has been
performed.
iii) Insurance commissions
Insurance commissions are recognised over time on a pro-rated basis over the
period the insurance policy relates to.
Accrued income
Accrued income relates to income in relation to fees from Joint Venture
veterinary practices, and overrider and promotional income from suppliers
which has not yet been invoiced. Accrued income has been classified as current
as it is expected to be invoiced and received within 12 months of the period
end. Supplier income is recognised on an accruals basis, based on the expected
entitlement that has been earned up to the balance sheet date for each
relevant supplier contract.
Cost of sales
Cost of sales includes costs of goods sold and other directly attributable
costs, promotional income and rebate income received from suppliers, including
costs to deliver administrative support services to Joint Venture veterinary
practices and costs to deliver grooming services. Supplier early payment
discounts are also included within cost of sales, these are offered from
certain inventory suppliers based on payment of invoices within a certain time
frame resulting in a percentage discount to reduce cost of sales.
Supplier income
A number of different types of supplier income are negotiated with suppliers
via the joint business planning process in connection with the purchase of
goods for resale, the largest of which being overrider income and promotional
income, which are explained below. The supplier income arrangements are
typically not coterminous with the Group's financial period, instead running
alongside the calendar year. Such income is only recognised when there is
reasonable certainty that the conditions for recognition have been met by the
Group, and the income can be measured reliably based on the terms of the
contract. This income is recognised as a credit within gross margin to cost of
sales and, to the extent that the rebate relates to unsold stock purchases, as
a reduction in the cost of inventory.
Supplier income is recognised on an accruals basis, based on the expected
entitlement that has been earned up to the balance sheet date for each
relevant supplier contract. The accrued incentives, rebates and discounts
receivable at period end are included within trade and other receivables.
Given the presence of the joint business plans, on the basis of the historic
recoverability of accrued balances, and as amounts are typically agreed with
suppliers prior to recognition, supplier income is not considered to be an
area of significant estimation that could impact on the following financial
year.
Supplier income comprises:
Overrider income
Overrider income comprises three main elements:
1. Fixed percentage-based income: These relate largely to volumetric
rebates based on the joint business plan agreements with suppliers. The income
accrued is based on the Group's latest forecast volumes and the latest
contract agreed with the supplier. Income is not recognised until the Group
has reasonable certainty that the joint business agreement will be fulfilled,
with the amount of income accrued regularly reassessed and remeasured
throughout the contractual period, based on actual performance against the
joint business plan.
2. Fixed lump sum income: These are typically guaranteed lump sum
payments made by the supplier and are not based on volume. Fixed lump sum
income is usually predicated on confirmation of a supplier contract and
typically includes performance conditions upon the Group, such as marketing
and promotional campaigns. These amounts are recognised periodically when
contractual milestones have been met such as the promotion being run or
marketing in-store.
3. Growth income: These are tiered volumetric rebates relating to
growth targets agreed with the supplier in the joint business planning
process. These are retrospective rebates based on sales volumes or purchased
volumes. Income is recognised to the extent that it is reasonably certain that
the conditions will be achieved, with such certainty increasing in the latter
part of the calendar year.
Notes (forming part of the financial statements) continued
1 Significant accounting policies (continued)
1.19 Revenue and cost of sales (continued)
Promotional income
Promotional income relates to supplier funded rebates specific to promotional
activity run in agreement between the Group and its suppliers. Rebates are
agreed at an individual inventory article level for agreed periods of time and
are systemically calculated based on article sales information. No estimation
is applied in calculating the promotional income receivable.
Supplier income is recognised on an accruals basis, based on the expected
entitlement that has been earned up to the balance sheet date for each
relevant supplier contract. The accrued incentives, rebates and discounts
receivable at period end are included within trade and other receivables.
1.20 Expenses
Financing income and expenses
Financing expenses comprise interest payable under the effective interest rate
method, incorporating amortisation of loan arrangement fees, finance charges
on shares classified as liabilities, unwinding of the discount on
provisions, interest on lease liabilities and net foreign exchange gains or
losses that are recognised in the income statement (see foreign currency
accounting policy). Borrowing costs that are directly attributable to the
acquisition, construction or production of an asset that takes a substantial
time to be prepared for use are capitalised as part of the cost of that asset.
Financing income comprises interest receivable on funds invested, dividend
income, and net foreign exchange gains.
Interest income and interest payable is recognised in profit or loss as it
accrues, using the effective interest method. Dividend income is recognised
in the income statement on the date the entity's right to receive payment is
established. Foreign currency gains and losses are reported on a net basis.
1.21 Taxation
Tax on the profit or loss for the period comprises current and deferred tax.
Tax is recognised in the income statement except to the extent that
it relates to items recognised directly in equity, in which case it is
recognised in equity.
Current tax is the expected tax payable or receivable on the taxable income or
loss for the period, using tax rates enacted or substantively enacted at the
balance sheet date, and any adjustment to tax payable in respect of previous
periods.
Deferred tax is provided on temporary differences between the carrying amounts
of assets and liabilities for financial reporting purposes and the amounts
used for taxation purposes. The following temporary differences are not
provided for: the initial recognition of goodwill; the initial recognition of
assets or liabilities that affect neither accounting nor taxable profit other
than in a business combination; and differences relating to investments in
subsidiaries to the extent that they will probably not reverse in the
foreseeable future. The amount of deferred tax provided is based on the
expected manner of realisation or settlement of the carrying amount of assets
and liabilities, using tax rates enacted or substantively enacted
at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that
future taxable profits will be available against which the temporary
difference can be utilised.
1.22 Accounting estimates and judgements
The preparation of consolidated financial statements in conformity with IFRS
requires management to make judgements, estimates and assumptions concerning
the future that affect the application of accounting policies and the reported
amounts of assets, liabilities, income and expenses. These judgements are
based on historical experience and management's best knowledge at the time and
the actual results may ultimately differ from these estimates. Estimates and
underlying assumptions are reviewed on an ongoing basis and revisions to
accounting estimates are recognised in the period in which the estimates are
revised and in any future periods affected.
The estimates and assumptions that have a risk of causing an adjustment to the
carrying value of assets and liabilities are explained below.
Impairment of goodwill and other intangibles (other estimate)
Determining whether goodwill and other intangibles are impaired requires an
estimation of the value in use of the cash-generating units to which goodwill
and other intangible assets have been allocated. The value in use calculation
requires estimation of future cash flows expected to arise from the
cash-generating unit (CGU) and a suitable discount rate in order to calculate
present value. Details of CGUs as well as further information about the
assumptions made are disclosed in note 13. The Directors consider that it is
not reasonably possible for the assumptions for the current financial year to
change so significantly to warrant inclusion as a significant estimate but
acknowledge that there is estimation uncertainty over the assumptions used in
future financial periods when calculating future cash flows.
1.23 Dividends
Final dividends are recognised in the Group's financial statements as a
liability in the period in which the dividends are approved by shareholders
such that the Company is obliged to pay the dividend. Interim equity dividends
are recognised in the period in which they are paid.
1.24 Non-underlying items
Income or costs considered by the Directors to be non-underlying are disclosed
separately to facilitate year-on-year comparison of the underlying trade of
the business. The Directors consider non-underlying costs to be those that
are not generated from ordinary business operations, infrequent in nature and
unlikely to reoccur in the foreseeable future.
1.25 Alternative Performance Measures
The Directors measure the performance of the Group based on a range of
financial measures, including measures not recognised by UK-adopted IFRS.
These Alternative Performance Measures may not be directly comparable with
other companies' Alternative Performance Measures and the Directors do not
intend these to be a substitute for, or superior to, IFRS measures. Further
information can be found in the Glossary on page 74.
1.26 Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank
overdrafts that are repayable on demand and form an integral part of the
Group's cash management are included as a component of cash and cash
equivalents for the purposes of the cash flow statement and are only offset
for balance sheet purposes where the offsetting criteria are met.
1.27 Prior year restatement on supplier discounts
In the current year the directors have reconsidered the presentation of
supplier early payment discounts, previously offset against expenses within
selling and distribution expenses, and have presented them as a reduction of
the costs of the relevant inventory within cost of sales. Comparatives have
been restated for consistency. As a result, selling and distributions expenses
have increased by £6.3m and cost of sales have decreased by £6.3m. There
is no effect on profit for the year or net assets.
Notes (forming part of the financial statements) continued
2 Segmental reporting
The Group has three reportable segments, Retail, Vet Group and Central, which
are the Group's strategic business units. The Group's operating segments are
based on the internal management structure and internal management reports,
which are reviewed by the Executive Directors on a periodic basis. The
Executive Directors are considered to be the Chief Operating Decision Makers.
The Group is a pet care business with the strategic advantage of being able to
provide products, services and advice, addressing all pet owners' needs.
Within this strategic umbrella, the Group has three reportable segments,
Retail, Vet Group and Central, which are the Group's strategic business units.
The strategic business units offer different products and services, are
managed separately and require different operational and marketing strategies.
The operations of the Retail reporting segment comprise the retailing of pet
products purchased online and in-store, pet sales, grooming services and
insurance products. The operations of the Vet Group reporting segment comprise
General Practice veterinary practices and TVC. Central includes group costs
and finance expenses. Revenue and costs are allocated to a segment where
reasonably possible.
The following summary describes the operations in each of the Group's
reportable segments. Performance is measured based on segment underlying
operating profit as included in the management reports that are reviewed by
the Executive Directors. These internal reports are prepared in accordance
with IFRS accounting policies consistent with these financial statements. All
material operations of the reportable segments are carried out in the UK and
all revenue is from external customers.
52 week period ended 28 March 2024
Income statement Retail Vet Group Central Total
£m £m £m £m
Revenue 1,330.1 146.5 - 1,476.6
Underlying gross profit 614.1 77.2 - 691.3
Underlying operating profit/(loss) 100.4 60.9 (15.8) 145.5
Non-underlying items (22.5) (2.8) (0.9) (26.2)
Segment operating profit 77.9 58.1 (16.7) 119.3
Underlying net financing expense (13.0) 0.7 (1.2) (13.5)
Non-underlying financing expense (0.1) - - (0.1)
Profit before tax 64.8 58.8 (17.9) 105.7
Total non-underlying items 22.6 2.8 0.9 26.3
Underlying profit/(loss) before tax 87.4 61.6 (17.0) 132.0
Non-underlying operating expenses in the periods ended 28 March 2024 and 30
March 2023 are explained in note 3.
52 week period ended 30 March 2023 (restated) (1)
Income statement Retail Vet Group Central Total
£m £m £m £m
Revenue 1,278.7 125.5 - 1,404.2
Underlying gross profit 607.8 66.8 - 674.6
Underlying operating profit/(loss) 109.9 52.1 (12.3) 149.7
Non-underlying items (10.1) - (2.8) (12.9)
Segment operating profit 99.8 52.1 (15.1) 136.8
Underlying net financing expense (11.1) (0.8) (1.4) (13.3)
Non-underlying financing expense (1.0) - - (1.0)
Profit before tax 87.7 51.3 (16.5) 122.5
Total non-underlying items 11.1 - 2.8 13.9
Underlying profit/(loss) before tax 98.8 51.3 (13.7) 136.4
(1) See note 1.1 and note 1.27 for an explanation of the prior year
restatements.
Notes (forming part of the financial statements) continued
2 Segmental reporting (continued)
52 week period ended 28 March 2024
Segmental revenue analysis by revenue stream Retail Vet Group Total
£m £m £m
Retail - Food 814.2 - 814.2
Retail - Accessories 465.5 - 465.5
Retail - Services 50.4 - 50.4
Vet Group - Joint Venture fee income - 89.3 89.3
Vet Group - Company managed practices - 44.6 44.6
Vet Group - Other income - 9.4 9.4
Vet Group - Veterinary telehealth services - 3.2 3.2
Total 1,330.1 146.5 1,476.6
52 week period ended 30 March 2023 (restated) (1)
Segmental revenue analysis by revenue stream Retail Vet Group Total
£m £m £m
Retail - Food 744.8 - 744.8
Retail - Accessories 486.4 - 486.4
Retail - Services 47.5 - 47.5
Vet Group - Joint Venture fee income - 77.2 77.2
Vet Group - Company managed practices - 37.5 37.5
Vet Group - Other income - 8.1 8.1
Vet Group - Veterinary telehealth services - 2.7 2.7
Total 1,278.7 125.5 1,404.2
(1) See note 1.1 for an explanation of the prior year restatement.
Notes (forming part of the financial statements) continued
3 Expenses and auditor's remuneration
Included in operating profit are the following:
52 week period ended 28 March 2024 52 week
£m period ended
30 March
2023
£m
Non-underlying items
Costs relating to the implementation of the new Distribution Centre
Provisions for voluntary redundancies for colleagues at existing Distribution 0.8 2.1
Centres
Provisions for retention and relocation bonuses for colleagues at existing 2.4 1.8
Distribution Centres
Pre-opening costs for new Distribution Centre - 4.0
Dual running costs of operating new and existing Distribution Centres 4.5 0.4
Project management costs of opening new Distribution Centre 1.8 0.7
Depreciation of property plant and equipment at legacy sites 3.4 0.4
Depreciation of right-of-use assets (dual running costs) 3.1 0.7
Transitional costs of opening a new Distribution Centre 5.4 -
21.4 10.1
Group restructure costs
Group restructure costs 1.4 2.7
Depreciation of property plant and equipment (Group restructure costs) 0.8 -
Depreciation of right-of-use assets (Group restructure costs) 0.6 -
Legal settlement costs 0.9 -
3.7 2.7
Other non-underlying items
Impairment of investment 1.1 -
Aborted transaction costs - 0.1
1.1 0.1
Total non-underlying items within operating profit 26.2 12.9
Interest expense on the lease liabilities of the Distribution Centres 0.1 1.0
Total non-underlying items 26.3 13.9
Underlying items
Impairment gains on receivables (1.0) (2.0)
Software as a service (SaaS) expense 27.9 29.9
Depreciation of property, plant and equipment 26.5 25.7
Amortisation of intangible assets 10.1 9.8
Depreciation of right-of-use assets 65.1 66.8
Rentals under operating leases:
Expenses relating to short term or low value leases - 0.1
Other income
Rental income from sub-leasing right-of-use assets to third parties (0.2) (0.3)
Rental and other occupancy income from related parties(1) (12.7) (12.2)
Share-based payment charges 5.9 4.9
(1)Rental and other occupancy income from related parties is included in other
income.
Non-underlying items in operating profit
New Distribution Centre and closure of the legacy sites
During the period the Group has incurred a number of costs in relation to the
process of bringing into operation a new Distribution Centre to replace the
existing legacy Distribution Centres. The process is a significant operational
change for the Group, outside of the ordinary course of business and is not
expected as a recurring event. As part of the transition, the Group has
incurred operational and payroll costs which it has classified as
non-underlying. The items are split out as follows:
£0.8m (£2.1m in the in the 52 week period ended 30 March 2023) of
non-underlying charges relate to a provision for voluntary redundancies for
colleagues employed within the existing Distribution Centres as part of the
transition.
£2.4m (£1.8m in the 52 week period ended 30 March 2023) of non-underlying
charges relate to a provision for retention bonuses for colleagues at the
existing Distribution Centres to remain employed by the Group until the point
at which the sites close as well as relocation costs for employees.
£4.5m (£0.4m in the 52 week period ended 30 March 2023) of non-underlying
charges relate to costs incurred whilst the existing Distribution Centres and
the new Distribution Centre are both in operation. These costs incurred are
temporary and will not continue after the closure of the existing Distribution
Centres.
£1.8m (£0.7m in the 52 week period ended 30 March 2023) of non-underlying
charges relate to project management costs of opening the new Distribution
Centre, including the transfer of inventory from the existing Distribution
Centres.
Notes (forming part of the financial statements) continued
3 Expenses and auditor's remuneration (continued)
£6.5m is in relation to depreciation charges of the legacy assets, £0.8m
(£0.4m in the 52 week period ended 30 March 2023) relates to the routine
depreciation during the year, £2.6m within this cost in relation to
accelerated depreciation and £3.1m (£0.7m in the 52 week period ended 30
March 2023) in relation to depreciation of the right-of-use assets.
£5.4m of non-underlying charges relate to costs incurred to transition the
operations over to the new site. These costs include costs incurred in
training new employees, are temporary and will not continue after the new
Distribution Centre is fully operational.
A further £0.1m of dual running costs relates to the interest expense on the
lease liabilities of the Distribution Centres. This is shown within finance
expenses below operating profit on the consolidated income statement.
Group restructure
During the period the Group conducted a support office restructure. The
non-underlying charges are split out as follows:
£1.4m (£2.7m in the 52 week period ended 30 March 2023) in restructure costs
primarily relate to retention and redundancy payments.
£0.8m in relation to accelerated depreciation of premises no longer required
as the group now operates from one support office following the restructure
and £0.6m in relation to depreciation of the associated right-of-use assets.
£0.9m relating to settlement costs.
Other non-underlying costs
The remaining non-underlying items relate to:
£1.1m of non-underlying charges relate to the impairment of the Group's
investment in Dog Stay Limited ('Tailster').
Income or costs considered by the Directors to be non-underlying are disclosed
separately to facilitate year-on-year comparison of the underlying trade of
the business. The Directors consider non-underlying costs to be those that are
not generated from ordinary business operations, infrequent in nature and
unlikely to reoccur in the foreseeable future.
Additonal non-underlying charges made during the 52 weeks ending 30 March 2023
relate to:
£4.0m of non-underlying charges relate to pre-opening costs for the new
Distribution Centre such as rent and utilities which have been incurred
despite the site not yet being fully operational.
£0.1m of non-underlying charges relate to aborted transaction costs.
Underlying items
The rentals under short term leases disclosed in relation to the 52 week
period ended 28 March 2024 and the 52 week period ended 30 March 2023 relate
to leases under short-term agreements or of low value. These fall under the
short-term and low value exemptions so are excluded from the requirements of
IFRS16 on the basis that the lease terms are 12 months or less.
Auditor's remuneration
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Audit of the parent company financial statements - -
Amounts receivable by the Company's auditor and its associates in respect of:
Audit of financial statements of subsidiaries pursuant to legislation 1.3 1.3
Review of interim financial statements 0.1 0.1
Other assurance services - -
1.4 1.4
4 Colleague numbers and costs
The average number of persons employed by the Group (including Directors)
during the period, analysed by category, was as follows:
52 week period ended 28 March 2024 52 week
Number period ended 30 March
2023
Number
Sales and distribution - FTE 7,297 7,063
Administration - FTE 1,072 960
8,369 8,023
Sales and distribution - total 10,924 10,371
Administration - total 1,107 1,006
12,031 11,377
Notes (forming part of the financial statements) continued
4 Colleague numbers and costs (continued)
The aggregate payroll costs of these persons were as follows:
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Wages and salaries 282.9 261.9
Social security costs 24.8 23.0
Contributions to defined contribution pension plans 10.0 8.6
317.7 293.5
Remuneration of Directors and Executive Management Team
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Executive Directors' remuneration paid in respect of qualifying services 2.3 2.9
Non-Executive Directors' remuneration paid in respect of qualifying services 0.6 0.6
Executive Directors' amount of gains on the exercise of share options 0.7 1.3
Executive Directors' pension contributions 0.1 0.1
Total Directors' remuneration 3.7 4.9
Executive Management Team remuneration paid in respect of qualifying services 6.5 7.1
Executive Management Team amount of gains on the exercise of share options 2.6 2.7
Executive Management Team pension contributions 0.2 0.2
Total Executive Management Team remuneration 9.3 10.0
In the opinion of the Board, the key management as defined under revised IAS24
Related Party Disclosures are the Executive Directors, Non-Executive Directors
and the Executive Management Team. Executive Directors' emoluments are also
included within the Executive Management Team emoluments disclosed above.
There are no further amounts, other than those noted above, receivable under
long term incentive schemes by the Directors or Executive Management team.
The number of directors who received pensions contributions in the 52 weeks
period ended 28 March 2024 is two for executive directors (three in the 52
week period ended 30 March 2023) and nine in the executive management team
(nine in the 52 week period ended 30 March 2023).
5 Earnings per share
Basic earnings per share is calculated by dividing the net profit for the
period attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the period.
Diluted earnings per share is calculated by dividing the net profit for the
period attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the period plus the weighted average number
of ordinary shares that would be issued on the conversion of all dilutive
potential ordinary shares into ordinary shares.
52 week period ended 28 March 2024 52 week period ended 30 March 2023
Underlying After non-underlying Underlying After non-underlying
trading items trading items
Profit attributable to equity shareholders of the parent (£m) 98.9 79.2 112.0 100.7
Basic weighted average number of shares 477.7 477.7 491.9 491.9
Dilutive potential ordinary shares 5.0 5.0 6.5 6.5
Diluted weighted average number of shares 482.7 482.7 498.4 498.4
Basic earnings per share 20.7p 16.6p 22.8p 20.5p
Diluted earnings per share 20.5p 16.4p 22.5p 20.2p
6 Finance income
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Interest receivable on loans to Joint Venture veterinary practices 0.5 0.4
Other interest receivable 3.5 2.3
Total finance income 4.0 2.7
Notes (forming part of the financial statements) continued
7 Finance expense
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Bank loans at effective interest rate 4.3 4.6
Underlying interest expense on lease liability 13.2 11.4
Non-underlying interest expense on lease liability 0.1 1.0
Total finance expense 17.6 17.0
8 Taxation
Recognised in the income statement
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Current tax expense
Current period 22.7 24.2
Adjustments in respect of prior periods (1.4) (0.9)
Current tax expense 21.3 23.3
Deferred tax expense
Origination and reversal of temporary differences 6.9 (0.6)
Impact of difference between deferred and current tax rates - (0.1)
Adjustments in respect of prior periods (1.7) (0.8)
Deferred tax expense 5.2 (1.5)
Total tax expense 26.5 21.8
The UK corporation tax standard rate for the period was 25% (2023: 19%).
Deferred tax at 28 March 2024 has been calculated based on the rate of 25%
which is the rate at which the majority of items are expected to reverse. This
is due to the increase in the main rate of corporation tax to 25% from April
2023, which was substantively enacted on 24 May 2021.
Deferred tax recognised in comprehensive income
52 week period ended 28 March 2024 52 week period ended 30 March 2023
£m £m
Effective portion of changes in fair value of cash flow hedges (note 22) (0.3) (1.3)
Reconciliation of effective tax rate
52 week period ended 28 March 2024 52 week period ended 30 March 2023
Underlying trading Non-underlying items Total Underlying trading Non-underlying items Total
£m £m £m £m £m £m
Profit for the period 98.9 (19.7) 79.2 112.0 (11.3) 100.7
Total tax expense/(credit) 33.1 (6.6) 26.5 24.4 (2.6) 21.8
Profit excluding taxation 132.0 (26.3) 105.7 136.4 (13.9) 122.5
Tax using the UK corporation tax rate for the period of 25% (52 week period 33.0 (6.6) 26.4 25.9 (2.6) 23.3
ended 30 March 2023: 19%)
Impact of difference between deferred and current tax rates - - - (0.1) - (0.1)
Depreciation on expenditure not eligible for tax relief 1.1 - 1.1 0.8 - 0.8
Capital allowances super-deduction - - - (1.7) - (1.7)
Expenditure not eligible for tax relief 2.1 - 2.1 1.1 - 1.1
Adjustments in respect of prior periods (3.1) - (3.1) (1.6) - (1.6)
Total tax expense 33.1 (6.6) 26.5 24.4 (2.6) 21.8
The UK corporation tax standard rate for the 52 week period ended 28 March
2024 was 25% (52 week period ended 30 March 2023: 19%). The effective tax
rate before non-underlying items for the 52 week period ended 28 March 2024
was 25.1% (52 week period ended 30 March 2023: 17.9%). The effective tax rate
after non-underlying items for the 52 week period ended 28 March 2024 was
25.1% (52 week period ended 30 March 2023: 17.8%).
Notes (forming part of the financial statements) continued
9 Dividends paid and proposed
Group and Company
52 week period ended 52 week period ended
28 March 2024 30 March 2023
£m £m
Declared and paid during the period
Final dividend of 8.3p per share (2022: 7.5p per share) 39.5 37.0
Interim dividend of 4.5p per share (2023: 4.5p per share) 21.2 21.7
Proposed for approval by shareholders at the AGM
Final dividend of 8.3p per share (2023: 8.3p per share) 38.8 40.1
The trustees of the following holdings of Pets at Home Group Plc shares under
the Pets at Home Group Employee Benefit Trust have waived or otherwise
foregone any and all dividends paid in relation to the periods ended 28 March
2024 and 30 March 2023 and to be paid at any time in the future (subject to
the exceptions in the relevant trust deed) on its respective shares for the
time being comprised in the trust funds:
Computershare Nominees (Channel Islands) Limited (holding at 28 March 2024:
5,564,701 shares; holding at 30 March 2023: 5,323,525 shares).
10 Business combinations
In the 52 week period ended 28 March 2024, the Group has acquired 100% of the
'A' shares of eight veterinary practices and 75% of the 'A' shares of one
veterinary practice, which were previously accounted for as Joint Venture
veterinary practices. These practices were previously accounted for as Joint
Venture veterinary practices as the Group only held 100% of the
non-participatory 'B' ordinary shares, equating to 50% of the total shares.
Acquisition of all or the majority of the 'A' shares has led to the control
and consolidation of these practices. A detailed explanation for the basis of
consolidation can be found in note 1.4.
In the 52 week period ended 28 March 2024, £1.6m of operating loans relating
to these practices were written off in advance of the acquisitions (see note
17).
Up to the date of acquisition and in the comparative period being the 52 week
period ending 30 March 2023, these entities listed below were all accounted
for as a Joint Venture veterinary practice where the Group held 100% of the
non-participatory 'B' ordinary shares. Acquisition of the 'A' shares has led
to the control and consolidation of these practices on the dates below,
leading to control from the date of acquisition and consolidation from that
date forward.
Subsidiaries acquired in the 52 week period ended 28 March 2024
Principal activity Date of acquisition Proportion of voting equity instruments acquired Total proportion of voting equity instruments owned following the acquisition Cash consideration transferred
£m
Leigh Vets4Pets Limited Veterinary practice 22/06/2023 50% 100% -
Companion Care (Telford)Limited Veterinary practice 07/07/2023 50% 100% 0.2
Companion Care (Farnham) Limited Veterinary practice 10/11/2023 50% 100% 0.1
Wakefield Vets4Pets Limited Veterinary practice 22/12/2023 50% 100% 0.2
Tilehurst Vets4Pets Limited Veterinary practice 08/01/2024 50% 100% 0.1
Companion Care (Salisbury) Limited Veterinary practice 24/01/2024 50% 100% 0.2
Companion Care (Kings Lynn) Limited Veterinary practice 13/02/2024 50% 100% 0.1
Larne Vets4Pets Limited Veterinary practice 14/03/2024 50% 100% 0.1
Gamston Vets4Pets Limited Veterinary practice 29/02/2024 50% 75% -
Notes (forming part of the financial statements) continued
10 Business combinations (continued)
Assets acquired and liabilities recognised at the date of acquisition
The amounts recognised in respect of identifiable assets and liabilities
relating to the acquisitions are as follows. The acquisition disclosures have
been combined as each acquisition is considered to be individually immaterial
to the Group. On acquisition, assets and liabilities are revalued to fair
value. Pre existing relationships between the Group and acquired Joint Venture
practice are not considered part of the business combination and have been
removed from the fair values of assets and liabilities recognised on
acquisition.
Fair value of assets and liabilities acquired
£m
Current assets
Trade and other receivables 0.2
Inventories 0.1
Non-current assets
Tangible fixed assets 0.4
Current liabilities
Bank loans (0.2)
Trade and other payables (0.5)
Net assets /(liabilities) -
Goodwill arising on acquisition
£m
Consideration 1.0
Less: Fair value of assets acquired -
Goodwill arising on acquisition 1.0
Impairment of goodwill -
Carrying value of goodwill 1.0
The consideration shown within the table above relates to both consideration
for the purchase of A-shares and cash settlement of 'A' shareholder Joint
Venture Partner loans, which were repaid to the 'A' shareholder at the point
of acquisition.
The goodwill acquired on the purchase of the nine Joint Venture practices has
been allocated to the Vet Group CGU and relates to expected future cashflows
from combining operations.
In the 52 week period ended 30 March 2023, the Group acquired 100% of the 'A'
shares of six veterinary practices, which were previously accounted for as
Joint Venture veterinary practices. These practices were previously accounted
for as Joint Venture veterinary practices as the Group only held 100% of the
non-participatory 'B' ordinary shares, equating to 50% of the total shares.
Acquisition of the 'A' shares has led to the control and consolidation of
these practices. A detailed explanation for the basis of consolidation can be
found in note 1.4.
In the 52 week period ended 30 March 2023, £2.0m of operating loans relating
to these practices were written off in advance of the acquisitions.
Subsidiaries acquired in the 52 week period ended 30 March 2023
Principal activity Date of acquisition Proportion of voting equity instruments acquired Total proportion of voting equity instruments owned following the acquisition Cash consideration transferred
£m
Accrington Vets4Pets Limited Veterinary practice 16/06/2022 50% 100% -
Companion Care (Banbury) Limited Veterinary practice 24/06/2022 50% 100% -
Companion Care (Chippenham) Limited Veterinary practice 28/06/2022 50% 100% -
Bangor Wales Vets4Pets Limited Veterinary practice 19/10/2022 50% 100% -
Newtownards Vets4Pets Limited Veterinary practice 24/11/2022 50% 100% -
Companion Care (Llantrisant) Limited Veterinary practice 07/03/2023 50% 100% 0.5
Notes (forming part of the financial statements) continued
10 Business combinations (continued)
Book value of assets and Adjustments on acquisition Fair value of assets and liabilities acquired
liabilities acquired £m £m
£m
Current assets
Cash and cash equivalents 0.1 - 0.1
Trade and other receivables 0.1 - 0.1
Inventories 0.1 - 0.1
Non-current assets
Tangible fixed assets 0.3 - 0.3
Intangible assets 0.1 0.3 0.4
Non-current liabilities
Lease liabilities - - -
Current liabilities
Bank loans (0.2) - (0.2)
Overdrafts (0.2) - (0.2)
Partner loans (0.4) 0.4 -
Trade and other payables (2.4) 2.1 (0.3)
Net (liabilities)/assets (2.5) 2.8 0.3
Assets acquired and liabilities recognised at the date of acquisition
The amounts recognised in respect of identifiable assets and liabilities
relating to the acquisitions are as follows. The acquisition disclosures have
been combined as each acquisition is considered to be individually immaterial
to the Group.
Goodwill arising on acquisition of veterinary practice subsidiaries in 52 week
period ended 30 March 2023
£m
Consideration 0.5
Less: Fair value of assets acquired (0.3)
Goodwill arising on acquisition 0.2
Impairment of goodwill -
Carrying value of goodwill 0.2
The consideration shown within the table above relates to both consideration
for the purchase of A-shares and cash settlement of 'A' shareholder Joint
Venture Partner loans, which were repaid to the 'A' shareholder at the point
of acquisition.
In line with IFRS3, the right-of-use asset has been brought on at value equal
to the lease liability, adjusted for any unfavourable market conditions. These
leases relate to standalone veterinary practices.
The goodwill acquired on the purchase of the six Joint Venture practices has
been allocated to the Vet Group CGU.
Notes (forming part of the financial statements) continued
11 Property, plant and equipment
Freehold property Leasehold improvements Fixtures, fittings, tools and equipment Assets under construction Total
£m £m £m £m £m
Cost
Balance at 30 March 2023 2.4 78.0 296.4 28.5 405.3
Additions - 5.9 30.9 - 36.8
On acquisition (note 10) - 0.4 - - 0.4
Transfers1 - - - 5.7 5.7
Brought into use - (0.1) 19.9 (19.8) -
Disposals - (1.7) (1.8) - (3.5)
Balance at 28 March 2024 2.4 82.5 345.4 14.4 444.7
Depreciation
Balance at 30 March 2023 0.4 36.7 221.3 - 258.4
Depreciation charge for the period - 5.9 24.8 - 30.7
Disposals - (1.1) (1.4) - (2.5)
Balance at 28 March 2024 0.4 41.5 244.7 - 286.6
Net book value
At 30 March 2023 2.0 41.3 75.1 28.5 146.9
At 28 March 2024 2.0 41.0 100.7 14.4 158.1
(1) The transfers balance of £5.7m is in relation to assets previously
categorised within software under construction within intangibles.
Freehold property Leasehold improvements Fixtures, fittings, tools and equipment Assets under construction Total
£m £m £m £m £m
Cost
Balance at 31 March 2022 2.4 65.7 261.6 12.7 342.4
Additions - 11.7 34.5 19.1 65.3
On acquisition (note 10) - 0.2 0.1 - 0.3
Brought into use - 0.8 0.8 (1.6) -
Transfers - - - (1.7) (1.7)
Disposals - (0.4) (0.6) - (1.0)
Balance at 30 March 2023 2.4 78.0 296.4 28.5 405.3
Depreciation
Balance at 31 March 2022 0.4 32.9 200.2 - 233.5
Depreciation charge for the period - 4.4 21.7 - 26.1
Disposals - (0.6) (0.6) - (1.2)
Balance at 30 March 2023 0.4 36.7 221.3 - 258.4
Net book value
At 31 March 2022 2.0 32.8 61.4 12.7 108.9
At 30 March 2023 2.0 41.3 75.1 28.5 146.9
Notes (forming part of the financial statements) continued
12 Leases
As lessee
Property, plant and equipment comprise owned and leased assets that do not
meet the definition of investment property.
The majority of the Group's trading stores, standalone veterinary practices,
Distribution Centres and Support Offices are leased under operating leases
with remaining lease terms of between 1 and 20 years. The Group also has a
number of non-property operating leases relating to vehicle, equipment and
material handling equipment with remaining lease terms of between 1 and 6
years.
Right-of-use assets
Property Equipment Total
£m £m £m
Cost
Balance at 30 March 2023 614.8 20.3 635.1
Additions 27.2 2.6 29.8
Disposals (1.5) (0.7) (2.2)
Balance at 28 March 2024 640.5 22.2 662.7
Depreciation
Balance at 30 March 2023 263.5 12.0 275.5
Depreciation charge for the period 64.5 4.3 68.8
Disposals (0.2) (0.7) (0.9)
Balance at 28 March 2024 327.8 15.6 343.4
Net book value
At 30 March 2023 351.3 8.3 359.6
At 28 March 2024 312.7 6.6 319.3
( )The costs relating to leases for which the Group applied the practical
expedient described in paragraph 5a of IFRS16 (leases with a contract term of
less than 12 months) amounted to £0.0m in the 52 week period ended 28 March
2024.
Property Equipment Total
£m £m £m
Cost
Balance at 31 March 2022 531.6 16.6 548.2
Additions 83.4 4.0 87.4
Cost reallocation (0.2) - (0.2)
Disposals - (0.3) (0.3)
Balance at 30 March 2023 614.8 20.3 635.1
Depreciation
Balance at 31 March 2022 199.2 8.9 208.1
Depreciation charge for the period 64.1 3.4 67.5
Cost reallocation 0.2 - 0.2
Disposals - (0.3) (0.3)
Balance at 30 March 2023 263.5 12.0 275.5
Net book value
At 31 March 2022 332.4 7.7 340.1
At 30 March 2023 351.3 8.3 359.6
The costs relating to leases for which the Group applied the practical
expedient described in paragraph 5a of IFRS16 (leases with a contract term of
less than 12 months) amounted to £0.1m in the 52 week period ended 30 March
2023.
Notes (forming part of the financial statements) continued
12 Leases (continued)
The following table sets out the maturity analysis of lease payments, showing
the undiscounted lease payments to be paid after the reporting date:
Maturity analysis - contractual undiscounted cash flows
At 28 March 2024 At 30 March 2023
£m £m
Less than one year 79.8 83.3
Between one and three years 133.9 145.3
Between three and five years 86.1 99.5
Between five and ten years 96.5 103.9
More than ten years 43.0 59.4
Total undiscounted lease liabilities 439.3 491.4
Carrying value of lease liabilities included in the statement of financial 380.8 421.4
position
Current 79.8 83.3
Non-current 301.0 338.1
For the lease liabilities at 28 March 2024 a 0.1% change in the discount rate
used would have increased the carrying value of lease liabilities by £1.0m
(30 March 2023: £1.8m).
In relation to new leases and lease extensions entered into by the Group
during the period, these are discounted at the rate implicit in the lease
which ranges from 4.8% to 5.4% depending on the length of the lease and
reflect the impact of increases to the Bank of England base rate during the
period.
Surplus and short term leases
The Group has a small number of surplus leases on properties from which it no
longer trades. A small number of these properties are currently vacant or the
sublet is not for the full term of the lease and there is deemed to be a risk
on the sublet. These leases are included within the lease balances disclosed
on the face of the balance sheet and a related provision has been made for
other property costs relating to these properties in note 21.
The Group has a small number of short term leases on properties from which it
no longer trades, or a subsection of a trading retail store. These properties
are sublet to third parties at contracted rates.
In line with IAS36, the carrying value of the right-of-use asset is assessed
for indicators of impairment and an impairment charge will be recognised if
necessary. An onerous lease provision was recognised where management believed
there was a risk of default or where the property remained vacant for a period
of time. As part of this review the Group has assessed the ability to
sub-lease the property and the right-of-use asset has been written down to
£nil where the Group does not consider a sublease likely.
13 Intangible assets
Goodwill Customer lists and 'know-how' Software Software under construction Total
£m £m £m £m £m
Cost
Balance at 30 March 2023 959.3 7.0 71.7 8.3 1,046.3
Additions 1.0 - 6.1 - 7.1
Transfers(1) - - - (5.7) (5.7)
Brought into use - - 2.4 (2.4) -
Disposals (0.8) (0.4) (0.1) - (1.3)
Balance at 28 March 2024 959.5 6.6 80.1 0.2 1,046.4
Amortisation
Balance at 30 March 2023 0.1 1.7 55.0 - 56.8
Amortisation charge for the period - 0.2 9.9 - 10.1
Disposals - (0.2) - - (0.2)
Balance at 28 March 2024 0.1 1.7 64.9 - 66.7
Net book value
At 30 March 2023 959.2 5.3 16.7 8.3 989.5
At 28 March 2024 959.4 4.9 15.2 0.2 979.7
(1) Transfers balance of (£5.7)m relates to assets previously categorised
within software under construction which are now within property, plant and
equipment.
Notes (forming part of the financial statements) continued
13 Intangible assets (continued)
Goodwill Customer lists and 'know-how' Software Software under construction Total
£m £m £m £m £m
Cost
Balance at 31 March 2022 959.1 6.7 68.3 - 1,034.1
Additions - - 5.5 4.5 10.0
On acquisition (note 10) 0.2 0.4 - - 0.6
Transfers(1) - - (4.0) 5.7 1.7
Brought into use - - 1.9 (1.9) -
Disposals - (0.1) - - (0.1)
Balance at 30 March 2023 959.3 7.0 71.7 8.3 1,046.3
Amortisation
Balance at 31 March 2022 0.1 1.0 45.9 - 47.0
Amortisation charge for the period - 0.7 9.1 - 9.8
Balance at 30 March 2023 0.1 1.7 55.0 - 56.8
Net book value
At 31 March 2022 959.0 5.7 22.4 - 987.1
At 30 March 2023 959.2 5.3 16.7 8.3 989.5
(1)Included within the cost of assets under construction in fixed assets
brought forward at 31 March 2022 was £1.7m which related to software assets
under construction. These have been reallocated to intangible assets as at 30
March 2023. A further £4.0m of software assets under construction were
classified as software assets in use at 31 March 2022. These have been
reallocated to software assets under construction.
Impairment testing
Cash generating units ('CGUs'), as defined by IAS36, within the Group are
considered to be aligned to the operating segments as shown in the table
below. Within the Retail operating segment, the CGU comprises the body of
stores, online operations, grooming operations and insurance operations.
Within the Vet Group operating segment, the CGU comprises the General Practice
veterinary practices and the veterinary telehealth business, hereafter
disclosed as The Vet Connection ('TVC'). Revenue and costs are allocated to a
segment and CGU where reasonably possible.
During the 52 weeks ending 28 March 2024, the Group incorporated TVC into the
Vet Group segment and TVC no longer generates independent cashflows, since its
resources are now pooled with the resources of the Vet Group . On this basis,
management have concluded that the TVC business is no longer a standalone CGU
as it is not capable of generating independent cashflows and has been subsumed
into the Vet Group CGU.
As at 28 March 2024 and 30 March 2023, the Group is deemed to have CGUs as
follows:
Goodwill
At 28 March 2024 At 30 March
£m 2023
£m
Retail 586.1 586.1
TVC(1) - 11.1
Vet Group 373.3 362.0
Total 959.4 959.2
The recoverable amount of the CGU has been calculated with reference to its
value in use. The key assumptions of this calculation are shown below:
52 week period 52 week period ended
ended 30 March 2023
28 March 2024
Retail Vet Group Retail Vet Group TVC(1)
Period on which management approved forecasts are based (years) 5 5 5 5 5
Growth rate applied beyond approved forecast period 2.0% 3.5% 2.0% 3.5% 2.0%
Discount rate (pre-tax) 11% 12% 12% 11% 11%
Gross profit margin (average over next 5 years) 45% 60% 46% 61% 61%
(1)TVC was incorporated within the Vet group reporting in the 52 weeks ending
28 March 2024.
The goodwill is considered to have an indefinite useful economic life and the
recoverable amount is determined based on 'value-in-use' calculations. These
calculations use a post-tax cash flow projection based on a five-year plan
approved by the Board. For the purposes of intangible asset impairment
testing, the model removes all cash flows associated with business units (for
example stores or practices yet to open, but within the planning horizon)
which the Group has a strategic intention to invest capital in, but has not
yet done so, thus ensuring that the future cash flows used in modelling for
impairment exclude any cash flows where the investment is yet to take place,
in accordance with the requirements of IAS36 to exclude capital expenditure to
improve asset performance. Contributions from and costs associated with new
stores and veterinary practices which are already operational at the
impairment test date are included in the cash flows. Cashflows related to the
central segment have been allocated between both CGUs on a proportionate
basis. The Group reviews components within CGUs such as stores and veterinary
practices for indicators of impairment. This approach is consistent with
impairment reviews carried out in the 2023 financial statements.
Notes (forming part of the financial statements) continued
13 Intangible assets (continued)
Impairment testing (continued)
The Retail forecast assumptions reflect continual innovation and our deep
understanding of our customers, incorporating assumptions based on past
experience of the industry, products and markets in which the CGU operates, in
order to generate the detailed assumptions used in the annual budget setting
process, and five year strategic planning process. The Vet Group forecast
assumptions are based on a deep understanding of the maturity profile of the
practices and their performance, incorporating assumptions based on past
experience of the industry, services and markets in which the CGU operates in
order to generate the detailed assumptions used in the annual budget setting
process, and five year strategic planning process. These linkages are embedded
in the revenue growth assumption as a result of offering online veterinary
consultations as an additional service to Joint Venture veterinary practices.
The projections are based on all available information and growth rates do not
exceed growth rates experienced in prior periods. A different set of
assumptions may be more appropriate in future years depending on changes in
the macro-economic environment and the industry in which each CGU operates.
The Group has considered key risk factors such as climate change, recessionary
impacts, current geopolitical tensions, continuing global supply chain issues,
inflationary pressures and the impact of consumer confidence in addition to
the impact of climate change and in particular the risks identified in the
Task Force on Climate Related Financial Disclosures ('TCFD') scenario analysis
conducted in undertaking this assessment.
The discount rate was estimated based on past experience and the weighted
average cost of capital is adjusted to reflect a market participant view. A
post tax discount rate was used within the value in use calculation and
adjustments made to calculate the pre-tax discount rate which is disclosed
above in line with IAS36 requirements.
The Directors have assumed a growth rate projection beyond the five-year
period based on market growth rates based on past experience within the Group,
taking into account the economic growth forecasts within the relevant
industries. The long-term growth rate in the Vet Group CGU exceeds the
long-term average for the UK but is an appropriate rate due to the growth in
the petcare industry.
The total recoverable amount in respect of goodwill for the CGUs assessed by
the Directors using the above assumptions is greater than the carrying amount
and therefore no impairment charge has been recorded in each period.
Within the Retail and Vet Group CGUs, a number of sensitivities have been
applied to the assumptions in reaching this conclusion including:
- Reduction in growth rate applied beyond forecast period by 100 bps
- Increasing the discount rate by 100 bps
- Reduction in gross margin percentage of 100 bps
None of the above, considered reasonably possible changes in assumptions,
would result in impairment when applied either individually or collectively.
The Directors consider that it is not reasonably possible for the assumptions
to change so significantly as to eliminate the excess of the recoverable
amount over the carrying value.
14 Inventories
At 28 March 2024 £m At 30 March 2023 £m
Finished goods 97.5 108.6
The cost of inventories recognised as an expense and included in 'cost of
sales' is £687.1m (52 week period ended 30 March 2023: £642.6m).
Inventory expensed to cost of sales includes the cost of the Stock Keeping
Units ('SKUs') sold, supplier income, stock wastage and foreign exchange
variances.
At 28 March 2024 the inventory provision amounted to £4.1m (30 March 2023:
£4.0m). The inventory provision is calculated by reference to the age of
the SKU and the length of time it is expected to take to sell. The provision
percentages applied in calculating the provision are as follows:
• Discontinued stock greater than 365 days: 100%
• Current stock greater than 365 days with a use by date: 50%
• Current stock within 180 and 365 days with a use by date: 25%
• Greater than 180 days with no use by date: 25%
In addition, a provision is held to account for store stock losses during the
period since which the SKU was last counted. The value of inventory against
which an ageing provision is held is £8.5m (30 March 2023: £8.4m).
In the 52 week period ended 28 March 2024, the value of inventory written off
to the income statement amounted to £10.3m (52 week period ended 30 March
2023: £9.6m).
Notes (forming part of the financial statements) continued
15 Deferred tax assets and liabilities
Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:
At 28 March 2024 At 30 March 2023
Assets Liabilities Total Assets Liabilities Total
£m £m £m £m £m £m
Property, plant and equipment - (6.1) (6.1) - (2.2) (2.2)
Financial assets 0.2 - 0.2 1.0 - 1.0
Financial liabilities - - - - (0.5) (0.5)
Other short term timing differences 1.9 (0.8) 1.1 3.4 (0.9) 2.5
Share based payments 0.1 - 0.1 1.1 - 1.1
Net deferred tax assets/(liabilities) 2.2 (6.9) (4.7) 5.5 (3.6) 1.9
Movement in deferred tax during the period
30 March Recognised in income Recognised in equity 28 March
2023 £m £m 2024
£m £m
Property, plant and equipment (2.2) (3.9) - (6.1)
Net financial assets/(liabilities) 0.5 - (0.3) 0.2
Other short term timing differences 2.5 (1.4) - 1.1
Share based payments 1.1 - (1.0) 0.1
1.9 (5.3) (1.3) (4.7)
Other short-term timing differences primarily relate to inventory provisions.
Movement in deferred tax during the prior period
31 March Recognised in income Recognised in equity 30 March
2022 £m £m 2023
£m £m
Property, plant and equipment 1.9 (4.1) - (2.2)
Net financial assets/(liabilities) (0.8) - 1.3 0.5
Other short term timing differences (3.1) 5.6 - 2.5
Share based payments 3.1 - (2.0) 1.1
1.1 1.5 (0.7) 1.9
Company
Movement in deferred tax during the period
30 March Recognised in income Recognised in equity 28 March
2023 £m £m 2024
£m £m
Net financial liabilities (0.4) - 0.4 -
Other short term timing differences 2.1 (1.3) - 0.8
Share based payments 1.1 - (1.0) 0.1
2.8 (1.3) (0.6) 0.9
The rate used to calculate deferred tax assets and liabilities is 25% based on
the rate at which the majority of items are expected to reverse.
Movement in deferred tax during the period
31 March Recognised in income Recognised in equity 30 March
2022 £m £m 2023
£m £m
Net financial liabilities (0.3) - (0.1) (0.4)
Other short term timing differences - 2.1 - 2.1
Share based payments 3.1 - (2.0) 1.1
2.8 2.1 (2.1) 2.8
The rate used to calculate deferred tax assets and liabilities is 25% based on
a blended rate at which the majority of items are expected to reverse.
Notes (forming part of the financial statements) continued
16 Other financial assets and liabilities
Group Company
At 28 March 2024 £m At 30 March 2023 £m At 28 March 2024 £m At 30 March 2023 £m
Non-current assets
Investments in Joint Venture veterinary practices 2.7 0.4 - -
Loans to Joint Venture veterinary practices - initial set up loans 5.2 6.6 - -
Loans to Joint Venture veterinary practices - other loans 0.5 1.2 - -
Other investments 2.0 2.1 - -
Other receivables 0.5 0.6 - -
10.9 10.9 - -
Investments in Joint Venture veterinary practices
The Investments in Joint Venture veterinary practices balance of £2.7m (2023:
£0.4m) comprises of two parts; £0.2m (2023: £0.4m) represents the 'B' share
capital in Joint Venture veterinary practice companies and £2.5m (2023: nil)
relates to capital contributions made to these companies for extensions and
improvements to their practice residences. These investments are held at cost
less impairment. In relation to the share, the fair values of investments in
unlisted equity securities are considered to be their carrying value which is
the cost to the Group on recognition, as the impact of discounting future cash
flows has been assessed as not material and the investment is
non-participatory. The share capital of the veterinary practice companies is
split equally into 'A' ordinary shares (held by Joint Venture Partners) and
'B' ordinary shares (held by the Group). Any operational decisions require the
agreement of the Joint Venture Partner. Under the terms of the agreements, the
Group ('B' shareholder) is not entitled to any profits, losses or dividends,
or any surplus on winding up or disposal, although it is entitled to appoint
Directors to the Board and carry the same shareholder voting rights as 'A'
ordinary shareholders. The agreements entitle the Group to receive income in
relation to support services offered in such areas as clinical development,
promotion and methods of operation as well as service activities including
accountancy, legal and property.
Loans to Joint Venture veterinary practices - initial set up loans
Loans to Joint Venture veterinary practices of £5.2m (2023: £6.6m) are
provided to Joint Venture veterinary practice companies trading under the
Companion Care, Vets4Pets or VetsforPets brands, in which the Group's share
interest is non-participatory. These loans support their initial set up and
working capital, and are held at amortised cost under IFRS9. Loans are
initially recorded at fair value and subsequently measured at amortised as the
impact of discounting future cash flows at a market rate of interest has been
assessed as not material. Under the terms of the loans provided to veterinary
companies trading under the Companion Care, Vets4Pets or VetsforPets brands
the loans attract varying interest rates between 2% and 3%. There is no set
date for repayment of the loans due to the Group.
The balances are shown net of an expected credit loss ('ECL') of £0.6m (2023:
£1.0m).
Gross loan value £m Expected Carrying
credit value of
loss loan
£m £m
As at 30 March 2023 7.6 (1.0) 6.6
Net repayment and further advances (1.8) - (1.8)
Provisions released during the period - 0.4 0.4
As at 28 March 2024 5.8 (0.6) 5.2
Analysis of expected credit loss by risk category
The following table presents an analysis of the credit risk and credit
impairment of initial set up loans held at amortised cost. The loans are
categorised as performing, significant increase in credit risk or in default
in accordance with the policy set out in note 1.16. The loss allowance is
calculated depending on the credit risk of each loan, the Group's expectations
of future cash flow recoverability and practice age in accordance with the
policy set out in note 1.16.
Credit risk At 28 March At 30 March
2024 2023
£m £m
Performing 5.2 6.6
Significant increase in credit risk 0.6 1.0
Gross carrying amount 5.8 7.6
Loss allowance (0.6) (1.0)
Net carrying amount 5.2 6.6
Notes (forming part of the financial statements) continued
16 Other financial assets and liabilities (continued)
Loans to Joint Venture veterinary practices - other loans
Loans to Joint Venture veterinary practices - other loans of £0.5m (2023:
£1.2m) represent loan balances to Joint Venture veterinary practices. These
loans are unsecured, typically for five to seven years and attract an interest
rate of SONIA plus 2.8%. The loans are accounted for at amortised cost under
IFRS9. The carrying value is considered to be the fair value on the day the
loans were granted as the impact of discounting future cash flows at a market
rate of interest has been assessed as not material. The loans are typically to
support capacity expansion. The balances have been assessed under the criteria
in note 1.16 as fully performing. Any expected credit losses are immaterial
(2023: £nil).
Gross loan value £m Expected credit loss Carrying value of loan
£m £m
As at 30 March 2023 1.2 - 1.2
Net repayment and further advances (0.7) - (0.7)
Provisions made during the period - - -
As at 28 March 2024 0.5 - 0.5
Other investments
Other investments are held at fair value through other comprehensive income
('FVOCI'). The fair values of investments in unlisted equity securities are
considered to be their carrying value as the impact of discounting future cash
flows has been assessed as not material and the investment is
non-participatory.
Other financial assets Group Company
At 28 March 2024 £m At 30 March 2023 £m At 28 March 2024 £m At 30 March 2023 £m
Current assets
Fuel forward contracts 0.1 - - -
Interest rate swaps - 2.0 - 2.0
Forward exchange contracts 0.2 - - -
Other receivables - 0.2 - -
0.3 2.2 - 2.0
Other financial liabilities Group Company
At 28 March 2024 At 30 March At 28 March 2024 At 30 March 2023
£m 2023 £m £m
£m
Current liabilities
Fuel forward contracts - (0.3) - -
Forward exchange contracts (1.0) (3.4) - -
(1.0) (3.7) - -
Group Company
At 28 March 2024 At 30 March At 28 March 2024 At 30 March
£m 2023 £m 2023
£m £m
Non-current liabilities
Interest rate swaps - (0.4) - (0.4)
- (0.4) - (0.4)
Notes (forming part of the financial statements) continued
17 Trade and other receivables
Group Company
At 28 March 2024 £m At 30 March 2023 £m At 28 March 2024 £m At 30 March 2023 £m
Current assets
Trade receivables 13.9 13.5 - -
Amounts owed by JV practices - funding for new practices 0.4 - - -
Amounts owed by Joint Venture veterinary practices - operating loans 5.8 10.4 - -
Amounts owed by Joint Venture veterinary practices - trading balances 10.9 11.5 - -
Other receivables 6.3 5.7 - -
Prepayments 9.3 3.4 - -
Accrued income 14.3 7.3 - -
Non-current assets
Amounts owed by Group undertakings - - 663.3 578.4
60.9 51.8 663.3 578.4
Trade and other receivables
The carrying amount of trade and other receivables approximates to the fair
value. Supplier income is included with trade and other receivables, this has
been invoiced where there is no legal right to offset. The impairment of trade
and other receivables is assessed in line with IFRS9. As at 28 March 2024 and
30 March 2023 the impact of expected credit loss on these balances was deemed
to be immaterial and as such no provision has been made.
The Group apply the simplified approach under IFRS9 and default to lifetime
expected credit loss. The ECL is immaterial on the trade receivables balance
for the 52 week period ended 28 March 2024 (52 week period ended 30 March
2023: £nil).
Amounts owed by Joint Venture veterinary practices
Amounts owed by Joint Venture veterinary practices represent trading balances
and operating loans owed by Joint Venture veterinary practices to the Group.
The impairment of amounts owed by Joint Venture veterinary practices relating
to trading balances are assessed in line with IFRS 9. As at 28 March 2024 and
30 March 2023, the impact of expected credit loss on these balances was deemed
to be immaterial due to the short term nature of these balances and as such no
provision has been made.
Operating loans are provided on a short-term monthly cycle to the extent that
a practice requires additional funding above their external bank loan.
Practices generate cash on a monthly basis which is applied to the repayment
of brought forward operating loans. For immature practices, loan balances may
increase due to operating requirements. Based on a projected cash flow
forecast on a practice by practice basis, the funding is expected to be
required for a number of years, however as cash is applied against opening
loan balances, the Group's expectation is that the brought forward balance
will be repaid in cash within 12 months. The loans have been classified as
current on this basis and the Group has chosen not to charge interest on these
balances, and they are initially recognised under IFRS9 at their nominal value
as the effect of discounting the expected cash flows based on the effective
interest rate at the market rate of interest is not material. The loans
advanced to the practices are interest free and either repayable on demand or
repayable within 90 days of demand. No facility exists and the levels of loans
are monitored in relation to review of the practices' performance against
business plan and a number of financial and non-financial KPIs in accordance
with the policy set out in note 1.16.
For those practices in default, a credit impairment charge is recognised under
IFRS9 taking into account the Group's expectations of future cash flow
recoverability. For other practices, a credit impairment charge is recognised
under IFRS9, taking into account both the probability of loss and the loss
proportion given default.
The balances above are shown net of allowances for expected credit losses held
for operating loans of £3.0m (2023: £3.4m). The basis for this allowance and
the movement in the period is set out below.
Group
Gross loan value Expected Carrying value of loan
£m credit loss £m
£m
As at 30 March 2023 13.8 (3.4) 10.4
Loans written off (1.6) - (1.6)
Net repayment and further advances (3.4) - (3.4)
Utilisation of provision - 1.1 1.1
Provisions made during the period - (0.7) (0.7)
As at 28 March 2024 8.8 (3.0) 5.8
During the 52 week period ended 28 March 2024, £1.6m of operating loans which
were deemed to be in default were written off in advance of the acquisition of
the 'A' shares (52 week period ended 30 March 2023: £2.0m) which led to the
control and consolidation of these practices. Further details of these
acquisitions are provided in note 10.
The Group continues to work with a number of Joint Venture Partners, where the
partners choose to follow the Group's recommendations on remediation plans
aimed at improving practice performance. Further details regarding credit risk
are provided in note 1.16.
Notes (forming part of the financial statements) continued
17 Trade and other receivables (continued)
The following table presents an analysis of the credit risk and credit
impairment of operating loans held at amortised cost. Based on their future
cashflow forecast, loans are categorised as performing or in default. The loss
allowance is calculated in accordance with the policy set out in note 1.16,
depending on the credit risk of each loan.
Credit risk At 28 March 2024 At 30 March 2023
£m £m
Performing 5.3 9.1
In default 3.5 4.7
Gross carrying amount 8.8 13.8
Loss allowance (3.0) (3.4)
Net carrying amount 5.8 10.4
Should forecast cash flows, as defined by the risk criteria in note 1.16,
decrease by 0.5% over the 10-year time horizon, this would lead to an increase
in the required provision for operating loans of £0.8m (30 March 2023:
£0.8m). This sensitivity is considered by management to represent a
reasonably possible range of estimation uncertainty, based on the variance in
current trading performance within these Joint Venture veterinary practices.
The factors which give rise to the estimation uncertainty include
macro-economic and industry specific factors, including the level of industry
growth, as well as gross margin percentages achieved within the industry,
which contain a number of factors including the availability of suitably
qualified veterinary personnel. Further details are provided in note 27.
Accrued income
Accrued income relates to income in relation to fees to Joint Venture
veterinary practices and overrider and promotional income from suppliers which
have not yet been invoiced. Accrued income is classified as current as it is
expected to be invoiced and received within 12 months of the period end date.
Supplier income is recognised on an accruals basis, based on the expected
entitlement that has been earned up to the balance sheet date for each
relevant supplier contract. As detailed in note 1.19, supplier income is
recognised as a credit within gross margin to cost of sales and is outside of
the scope of IFRS15. Further detail of the Group's revenue recognition policy
is provided in note 1.19.
Company
Amounts owed by Group undertakings
Amounts owed by Group undertakings are repayable on demand bearing no interest
and with no expectation that it will be settled within the next 12 months. The
ECL calculated under IFRS 9 is not material.
18 Cash and cash equivalents
Group Company
At 28 March 2024 £m At 30 March 2023 £m At 28 March 2024 £m At 30 March 2023 £m
Cash at bank 57.1 178.0 - 0.4
19 Other interest-bearing loans and borrowings
Group Company
At 28 March 2024 £m At 30 March 2023 £m At 28 March 2024 £m At 30 March 2023 £m
Non-current liabilities
Unsecured bank loans 22.2 97.3 22.2 97.3
Asset backed loans 21.1 22.0 - -
Total 43.3 119.3 22.2 97.3
Group Company
At 28 March 2024 £m At 30 March 2023 £m At 28 March 2024 £m At 30 March 2023 £m
Current liabilities
Asset backed loans 2.2 1.2 - -
Terms and debt repayment schedule
Currency Nominal interest rate Year of maturity Face value at Carrying amount at Face value at Carrying amount at
28 March 28 March 30 March 30 March
2024 2024 2023 2023
£m £m £m £m
Revolving credit facility GBP SONIA +1.30% 2028 25.0 22.2 100.0 97.3
Asset backed loan GBP SONIA +1.50% 2030 23.3 23.3 23.3 23.2
Total 48.3 45.5 123.3 120.5
Notes (forming part of the financial statements) continued
19 Other interest-bearing loans and borrowings (continued)
The drawn amount on the £300.0m revolving credit facility was £25.0m at 28
March 2024 (drawn amount on the £300.0m revolving credit facility was
£100.0m at 30 March 2023) and this amount is reviewed each month. Interest is
charged at SONIA plus a margin based on leverage on a pre-IFRS16 basis (net
debt: EBITDA). The loan also has ESG linked metrics which will be reflected in
the margin payable, which is +/- 5bps. Face value represents the principal
value of the revolving credit facility. The facility is unsecured.
On 27 March 2023, the Group entered into a loan agreement to fund the purchase
of capital items. The drawn amount on the £26.0m facility at 28 March 2024
was £23.3m. Interest is charged on the amount drawn at SONIA plus 1.5%. The
Group will make monthly repayments until the loan matures on 27 March 2030.
The repayments do not begin until the full facility has been drawn.
Interest-bearing borrowings are recognised initially at fair value, being the
principal value of the loan net of attributable transaction costs. Subsequent
to initial recognition, interest-bearing borrowings are stated at a carrying
value, which represents the amortised cost of the loans using the effective
interest method.
The analysis of repayments on the loans is as follows:
At 28 March 2024 £m At 30 March
2023 £m
Within one year or repayable on demand 2.2 1.2
Between one and two years 4.3 3.7
Between two and five years 37.9 111.2
Greater than five years 3.9 7.2
48.3 123.3
The £25.0m revolving credit facility at 28 March 2024 is held by the Company.
The £23.3m of asset backed loan are held by Pets at Home Limited, a 100%
owned subsidiary company.
The Group's policy with regard to interest rate risk is to hedge the
appropriate level of borrowings by entering into fixed rate agreements. The
Group has fixed interest rate swap agreements over a total £50.0m of senior
facility borrowing at a blended fixed rate of 5.058% which expires in
September 2024.
The hedges are structured to hedge at least 70% of the forecast outstanding
debt for the next 12 months.
Analysis of changes in net debt
At Cash flow Non-cash movement At
30 March 2023 £m £m 28 March 2024 £m
£m
Cash and cash equivalents 178.0 (120.9) - 57.1
Debt due within one year (1.2) - (1.0) (2.2)
Debt due after one year (122.1) 75.0 1.0 (46.1)
Net debt 54.7 (45.9) - 8.8
20 Trade and other payables
Group Company
At 28 March 2024 £m At 30 March 2023 £m At 28 March 2024 £m At 30 March 2023 £m
Current
Trade payables 138.2 155.5 - -
Accruals and deferred income 74.9 68.5 2.8 1.5
Amounts owed to Joint Venture veterinary practices 0.8 4.5 - -
Other payables including tax and social security 35.3 32.7 - -
Amounts owed to Group undertakings - - 813.5 616.5
249.2 261.2 816.3 618.0
Amounts owed to Joint Venture veterinary practices that relate to trading
balances are interest free and repayable on demand.
Within accruals and deferred income above, contract liabilities under IFRS15
of £0.4m (2023: £0.5m) relate to advanced consideration received from
customers in relation to gift vouchers, cards and points redeemable by
charities. This revenue will be recognised as the vouchers, cards and points
are redeemed, which is expected to be over the next two years.
Within accruals above, contract liabilities under IFRS15 of £1.3m (2023:
£1.9m) relate to advanced consideration received from customers in relation
to online orders which have not yet been delivered. This revenue will be
recognised as the online orders are delivered to customers, which is expected
to be in less than one week from the balance sheet date.
Notes (forming part of the financial statements) continued
21 Provisions
Dilapidation provision Closed stores provision Provision for exit and closure costs relating to existing Distribution Centres Total
£m £m Provisions for exit and closure costs relating to Joint Venture veterinary £m £m
practices
£m
Balance at 30 March 2023 9.2 0.7 3.2 3.7 16.8
Provisions made during the period 0.3 - 3.7 2.8 6.8
Provisions utilised during the period (0.7) (0.6) (2.3) (2.6) (6.2)
Provisions released (4.6) - (0.1) - (4.7)
Balance at 28 March 2024 4.2 0.1 4.5 3.9 12.7
At 28 March 2024 £m At 30 March
2023 £m
Current 7.6 3.9
Non-current 5.1 12.9
12.7 16.8
As a result of the closure and planned closure of the existing Distribution
Centres on the transition to the Stafford Distribution Centre, at 28 March
2024, the Group has a provision of £1.4m (2023: £2.0m) for voluntary
redundancies for colleagues employed at those sites. The Group also holds a
provision of £2.5m (2023: £1.7m) for retention bonuses payable to colleagues
who remain from the previous Distribution Centres provided they remain
employed by the Group until the remaining sites close. Further information is
provided in note 3.
The closed stores provision relates to the rates, service charge and utilities
payable on vacant stores. The timing of the utilisation of these provisions is
variable dependent upon the lease expiry dates of the properties concerned,
which vary between one and three years. Market conditions have an impact and
hence the assumptions on future cash flows are reviewed regularly and
revisions to the provision made where necessary.
The dilapidations provision relates to the expected cost of repairs on leased
properties at future lease expiry dates, all of which are expected to be
within within 2 years of the 52 weeks ending 28 March 2024, therefore the
provision is not discounted. The timing of the utilisation of these provisions
is variable depending on the expiry dates of the property leases concerned.
The provisions for exit and closure costs relating to Joint Venture veterinary
practices relate to expenses for any Joint Venture veterinary practices that
the Group has bought out or has offered to buy out from Joint Venture
Partners, and therefore which have been provided for under IAS37. The timing
of the utilisation of these provisions is variable dependent upon the lease
expiry dates of the properties concerned, which vary between 2 and 13 years.
Market conditions have a significant impact and hence the assumptions on
future cash flows are reviewed regularly and revisions to the provision made
where necessary.
22 Capital and reserves
Share capital
Group
Share capital Number Share capital
£m
At 31 March 2022 500,000,000 5.0
At 30 March 2023 483,197,785 4.8
At 28 March 2024 467,911,542 4.7
Company
Share capital
28 March 2024 £m
At beginning of period 4.8
Nominal value of shares cancelled in year following purchase by the Group (0.1)
On issue at period end - authorised 4.7
In the 52 week period ended 28 March 2024, the Company bought back and
cancelled 15,286,243 ordinary shares for total consideration including stamp
duty of £50.3m, at an average market value of 327 pence per share.
Notes (forming part of the financial statements) continued
22 Capital and reserves (continued)
Share capital
30 March 2023 £m
At beginning of period 5.0
Nominal value of shares cancelled in year following purchase by the Group 0.2
On issue at period end - authorised 4.8
In the 52 week period ended 30 March 2023, the Company bought back and
cancelled 16,802,215 ordinary shares for total consideration including stamp
duty of £50.3m, at an average market value of 298 pence per share.
The holders of ordinary shares are entitled to receive dividends as declared
from time to time and are entitled to one vote per share at meetings of the
Company.
Consolidation and Merger reserves
The consolidation reserve and the merger reserve arose as a result of the
creation of Pets at Home Group Plc and its purchase of the existing group of
companies as part of the Initial Public Offering in 2014. As part of the IPO,
a number of shares in Plc were issued in exchange for various instruments or
cash. The premium arising on the issue was allocated between the share premium
and merger reserve. A consolidation reserve was also created which reflected
the difference between Plc reserves and the consolidated equity of PAH Lux
S.a.r.l as part of the IPO in 2014.
Capital redemption reserve
The capital redemption reserve comprised the par value of the 15.3m
(2023:16.8m) shares purchased and cancelled as part of the share buyback
programme completed in the 52 week period ended 28 March 2024.
Translation reserve
The translation reserve comprises all foreign exchange differences arising
since 21 November 2011, the date of incorporation of Pets at Home Asia Ltd
where the functional currency differs from that of the rest of the Group.
Cash flow hedging reserve
The cash flow hedging reserve comprises the effective portion of the
cumulative net change in the fair value of cash flow hedging instruments
related to hedged transactions that have not yet occurred.
Retained earnings
Included within the Group is Pets at Home Employee Benefit Trust ('EBT'). The
EBT purchases shares to fund the share option schemes. As at 28 March 2024,
the EBT held 5,564,701 ordinary shares (2023: 5,323,525) with a cost of
£20,300,288 (2023: £19,546,982). The average purchase value of these shares
as at 28 March 2024 was 364.8 pence per share (2023: 367.2 pence per share).
Other comprehensive income
28 March 2024
Translation reserve Cash flow hedging reserve Total other comprehensive income
£m £m £m
Other comprehensive income - - -
Effective portion of changes in fair value of cash flow hedges - 3.3 3.3
Net change in fair value of cash flow hedges reclassified to profit or loss - 1.3 1.3
Deferred tax on changes in fair value of cash flow hedges - (0.3) (0.3)
Total other comprehensive income - 4.3 4.3
30 March 2023
Translation reserve Cash flow hedging reserve Total other comprehensive income
£m £m £m
Other comprehensive income (0.1) - (0.1)
Effective portion of changes in fair value of cash flow hedges - (10.6) (10.6)
Deferred tax on changes in fair value of cash flow hedges - 1.3 1.3
Total other comprehensive income (0.1) (9.3) (9.4)
Notes (forming part of the financial statements) continued
23 Financial instruments
Financial risk management
The Group's activities expose it to a variety of financial risks: market risk
(including currency risk, fair value interest rate risk and cash flow interest
rate risk), credit risk and liquidity risk.
Risk management framework
Risk management in respect of financial risk is carried out by the Group
Treasury function under policies approved by the Board of Directors.
The Board of Directors has overall responsibility for the establishment and
oversight of the Group's risk management framework. The Board provides
written principles through its Group Treasury Policy for overall risk
management, as well as written policies covering specific areas, such as
foreign exchange risk, interest rate risk, credit risk, use of derivative
financial instruments and non-derivative financial instruments, and investment
of excess liquidity.
The main objectives of the Group Treasury function are:
· To ensure shareholder and management expectations are managed on
cash flow and earnings volatility resulting from financial market movements;
· To protect the expected cash flow and earnings from interest rate
and foreign exchange fluctuations to within parameters acceptable
to the Board and shareholders; and
· To control banking costs and service levels.
Market risk
Foreign currency risk
The Group sources a significant level of purchases in foreign currency, in the
region of US$110m each financial year, and monitors its foreign currency
requirements through short, medium and long-term cash flow forecasting. The
value of purchases in US dollars continues to increase each year and the risk
management policy has evolved with this increased risk.
At 28 March 2024, the Group's policy is to hedge up to 95% of the next 12
months and additionally up to 60% of the following six months out to 18 months
forecast foreign exchange transactions, using foreign currency bank accounts
and forward foreign exchange contracts. The transactions are deemed to be
'highly probable' and are based on historical knowledge and forecast purchase
and sales projections.
The Group's exposure to foreign currency risk is as follows. This is based on
the carrying amount for monetary financial instruments, except
for derivatives which are based on notional amounts:
28 March 2024
Euro US Dollar HKD Total
£m £m £m £m
Cash and cash equivalents 0.4 6.1 - 6.5
Trade payables (2.8) (3.2) - (6.0)
Forward exchange contracts (0.2) (0.6) - (0.8)
Balance sheet exposure (2.6) 2.3 - (0.3)
Euro US Dollar HKD Total
30 March 2023 £m £m £m £m
Cash and cash equivalents 0.3 6.8 - 7.1
Trade payables (2.9) (7.2) - (10.1)
Forward exchange contracts - (3.3) - (3.3)
Balance sheet exposure (2.6) (3.7) - (6.3)
Sensitivity analysis
A 5% weakening of the following currencies against the pound sterling at the
period end date in both years would have increased profit or loss or equity by
the amounts shown below. This calculation is post the impact of hedging and
assumes that the change occurred at the balance sheet date and had been
applied to risk exposures existing at that date.
This analysis assumes that all other variables, in particular other exchange
rates and interest rates, remain constant.
Equity Profit or loss
28 March 30 March 28 March 30 March
2024 2023 2024 2023
£m £m £m £m
US Dollar - 0.2 (0.1) -
Euro - - 0.1 -
A 5% strengthening of the above currencies against the pound sterling in any
period would have had the equal but opposite effect on the above currencies to
the amounts shown above, on the basis that all other variables remain
constant.
Notes (forming part of the financial statements) continued
23 Financial instruments (continued)
Managing interest rate benchmark reform and associated risks
The Group's exposure to sterling SONIA designated in hedging relationships is
£48.3m at 28 March 2024, £25.0m of which represents the nominal amount of
the hedging interest rate swap and the principal amount of the hedged
sterling-denominated revolving credit facility.
Interest rate risk
Cash flow and fair value interest rate risk
The Group's interest rate risk arises from long-term borrowings. As at 28
March 2024 the Group had a revolving credit facility with a face value
totalling £25.0m and an asset backed loan with a face value of £23.3m. The
Group's borrowings as at 28 March 2024 incur interest at a rate of 1.3% to
1.5% plus SONIA at the leverage prevalent in the period, which exposes the
Group to cash flow interest rate risk. The analysis of loan repayments is
detailed in note 19.
The Group's policy with regard to interest rate risk is to hedge the
appropriate level of borrowings by entering into fixed rate agreements. From
25 September 2023 the Group has fixed interest rate swap agreements covering
£50.0m of senior facility borrowing at a blended fixed rate of 5.058% which
expires in September 2024. The hedge is structured to hedge at least 70% of
the forecast outstanding debt for the next year.
Profile
At the balance sheet date the interest rate profile of the Group's
interest-bearing financial instruments was:
Group Company
Book value Book value Book value Book value
At 28 March 2024 At 30 March At 28 March 2024 At 30 March 2023
£m 2023 £m £m
£m
Fixed rate instruments
Financial liabilities 48.3 100.0 25.0 100.0
Variable rate instruments
Financial liabilities - 23.3 - -
Total financial liabilities 48.3 123.3 25.0 100.0
All borrowings bear a variable rate of interest based on SONIA. Group policy
is to hedge at least 70% of the loans to ensure a fixed rate of interest.
Therefore, designated above is the portion of the loan hedged by a fixed rate
interest rate swap.
Sensitivity analysis
A change of 50 basis points in interest rates at the period end date would
have increased/(decreased) equity and profit or loss by the amounts shown
below post hedging. This calculation assumes that the change occurred at the
balance sheet date and had been applied to risk exposures existing
at that date.
This analysis assumes that all other variables, in particular foreign currency
rates, remain constant and considers the effect of financial instruments with
variable interest rates, financial instruments at fair value through profit or
loss or available for sale with fixed interest rates and the fixed rate
element of interest rate swaps. The analysis is performed on the same basis
for the comparative period.
At 28 March 2024 £m At 30 March 2023 £m
Equity
Increase 0.1 0.5
Decrease (0.1) (0.5)
Profit or loss
Increase 0.1 0.1
Decrease (0.1) (0.1)
Credit risk
Financial risk management
Credit risk is the risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet its contractual
obligations and arises principally from the Group's receivables from
customers, investment securities and operating loans to Joint Venture
veterinary practices.
Credit risk also arises from cash and cash equivalents, derivative financial
instruments and deposits with banks and financial institutions. The Group
ensures that the banks used for the financing of the revolving credit
facilities and interest rate swap agreements hold an acceptable risk rating by
independent parties.
The Group has in place certain guarantees over the bank loans taken out by a
number of Joint Venture veterinary practice companies in which it holds an
investment. Further details of these guarantees are disclosed in note 27. The
performance of the Joint Venture veterinary practice companies is reviewed
on an ongoing basis.
Exposure to credit risk
The Group's maximum exposure to credit risk, being the carrying amount of
financial assets, is summarised in the table within the fair values section
below.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its
financial obligations as they fall due.
Management prepares and monitors rolling forecasts of the Group's cash
balances based on expected cash flows to ensure, as far as possible, that it
will have sufficient liquidity to meet its liabilities when due, under both
normal and stressed conditions without risking damage to the Group's
reputation. Covenants are monitored on a regular basis to ensure there is no
risk or breach which would lead to an 'Event of Default' and compliance
certificates are issued as required to the syndicate agent.
Notes (forming part of the financial statements) continued
23 Financial instruments (continued)
The following are the contractual maturities of financial liabilities
including estimates of interest payable based on SONIA rates at the end of the
financial period:
Group
28 March 2024
Carrying amount £m Contractual cash flows £m 1 year or less £m 1 to <2 years 2 to <5 years 5 years and over £m
£m £m
Non-derivative financial liabilities
Bank loans (note 19) 45.5 48.3 2.2 4.3 37.9 3.9
Trade payables (note 20) 138.2 138.2 138.2 - - -
183.7 186.5 140.4 4.3 37.9 3.9
30 March 2023 Carrying amount £m Contractual cash flows £m 1 year or less £m 1 to <2 years 2 to <5 years 5 years and over £m
£m £m
Non-derivative financial liabilities
Bank loans (note 19) 120.5 140.5 6.6 7.5 118.8 7.6
Trade payables (note 20) 155.5 155.5 155.5 - - -
276.0 296.0 162.1 7.5 118.8 7.6
Company
28 March 2024
Carrying amount £m Contractual cash 1 year or less £m 1 to <2 years 2 to <5 years 5 years and over £m
flows £m £m £m
Non-derivative financial liabilities
Bank loans (note 19) 22.2 25.0 - - 25.0 -
22.2 25.0 - - - -
30 March 2023 Carrying amount £m Contractual cash 1 year or less £m 1 to <2 years 2 to <5 years 5 years and over £m
flows £m £m £m
Non-derivative financial liabilities
Bank loans (note 19) 97.3 111.9 4.0 2.7 105.2 -
97.3 111.9 4.0 2.7 105.2 -
Liquidity risk and cash flow hedges
Cash flow hedges
The following table indicates the periods in which the cash flows associated
with cash flow hedging instruments are expected to occur and to affect profit
or loss:
Group
28 March 2024
Carrying amount £m Expected cash flows 1 year or less 1 to <2 years 2 to <5 years 5 years and over £m
£m £m £m £m
Forward exchange contracts:
Current liabilities (note 16) (1.0) (1.0) (1.0) - - -
(1.0) (1.0) (1.0) - - -
30 March 2023
Carrying amount £m Expected cash flows 1 year or less 1 to <2 years 2 to <5 years 5 years and over £m
£m £m £m £m
Interest rate swaps:
Current assets (note 16) 2.0 2.0 2.0 - - -
Non-current liabilities (note 16) (0.4) (0.4) - (0.4) - -
Forward exchange contracts:
Current liabilities (note 16) (3.4) (3.4) (3.4) - - -
Fuel forward contracts:
Current liabilities (note 16) (0.3) (0.3) (0.3) - - -
(2.1) (2.1) (1.7) (0.4) - -
Notes (forming part of the financial statements) continued
23 Financial instruments (continued)
Company
28 March 2024
Carrying amount £m Expected cash flows 1 year or less 1 to <2 years 2 to <5 years 5 years and over £m
£m £m £m £m
Interest rate swaps:
Assets (note 16) - - - - - -
Liabilities (note 16) - - - - - -
- - - - - -
30 March 2023 Carrying amount £m Expected cash flows 1 year or less 1 to <2 years 2 to <5 years 5 years and over £m
£m £m £m £m
Interest rate swaps:
Assets (note 16) 2.0 2.0 2.0 - - -
Liabilities (note 16) (0.4) (0.4) - (0.4) - -
1.6 1.6 2.0 (0.4) - -
Fair values of financial instruments
Investments
The fair values of investments are considered to be their carrying value as
the impact of discounting future cash flows has been assessed
as not material and the investment is non-participatory.
Trade and other payables and receivables
The fair values of these items are considered to be their carrying value as
the impact of discounting future cash flows has been assessed
as not material.
Cash and cash equivalents
The fair value of cash and cash equivalents is its carrying amount where the
cash is readily available. The fair value of short term deposits approximates
to the carrying amount because of the short maturity of these instruments.
Long term and short term borrowings
The fair value of bank loans and other loans approximates their carrying value
as they have interest rates based on SONIA. The impact of credit risk has an
immaterial impact on the fair value.
Short term deposits
The fair value of short term deposits is considered to be their carrying value
as the balances are held in floating rate accounts where the interest rate is
reset to market rates.
Derivative financial instruments
The fair values of forward exchange contracts and interest rate swap contracts
are calculated by management based on external valuations received from the
Group's bankers and are based on forward exchange rates and anticipated future
interest yield respectively.
Contingent consideration
Contingent consideration on acquisition or disposal of a subsidiary is valued
at fair value at the time of acquisition or disposal. Any subsequent changes
in fair values are recognised in profit or loss.
Fair values
The fair values of all financial assets and financial liabilities by class
together with their carrying amounts shown in the balance sheet are as
follows:
Fair value hierarchy
The table below shows the carrying amounts and fair values of financial assets
and financial liabilities, including their levels in the fair value hierarchy.
Level 1: quoted prices (unadjusted) in active markets for identical assets or
liabilities
Level 2: inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices)
Level 3: inputs for the asset or liability that are not based on observable
market data (unobservable inputs)
Notes (forming part of the financial statements) continued
23 Financial instruments (continued)
The following tables show the fair values and carrying amounts of financial
assets and liabilities as well as their fair value hierarchy. The tablets do
not include fair value detail for financial assets and liabilities not
measured at fair value if their carrying value is a reasonable approximation
of fair value.
28 March 2024
Carrying amount Fair value - hedging instruments FVOCI - equity instruments Financial assets at amortised cost Other financial liabilities Total carrying amount
£m £m £m £m £m
Financial assets measured at fair value
Forward exchange contracts used for hedging (note 16) 0.2 - - - 0.2
Fuel forward contracts used for hedging (note 16) 0.1 - - - 0.1
Interest rate swaps used for hedging (note 16) - - - - -
0.3 - - - 0.3
Financial assets not measured at fair value
Other investments (note 16) - - 2.0 - 2.0
Investments in Joint Venture veterinary practices (note 16) - - 2.7 - 2.7
Current trade and other receivables (note 17) - - 20.2 - 20.2
Amounts owed by Joint Venture veterinary practices - funding, trading and - - 17.1 - 17.1
operating loans (note 17)
Cash and cash equivalents (note 18) - - 57.1 - 57.1
Loans to Joint Venture veterinary practices - initial set up loans (note 16) - - 5.2 - 5.2
Loans to Joint Venture veterinary practices - other loans (note 16) - - 0.5 - 0.5
Non-current other receivables (note 16) - - 0.5 - 0.5
- - 105.3 - 105.3
Financial liabilities measured at fair value
Fuel forward exchange contracts used for hedging (note 16) - - - - -
Forward exchange contracts used for hedging (note 16) (1.0) - - - (1.0)
Interest rate swaps used for hedging (note 16) - - - - -
(1.0) - - - (1.0)
Financial liabilities not measured at fair value
Current lease liabilities (note 12) - - - (79.8) (79.8)
Non-current lease liabilities (note 12) - - - (301.0) (301.0)
Trade payables (note 20) - - - (138.2) (138.2)
Amounts owed to Joint Venture veterinary practices (note 20) - - - (0.8) (0.8)
Other interest-bearing loans and borrowings (note 19) - - - (45.5) (45.5)
- - - (565.3) (565.3)
28 March 2024
Fair value Level 1 Level 2 Level 3 Total
£m £m £m £m
Financial assets measured at fair value
Forward exchange contracts used for hedging (note 16) - 0.2 - 0.2
Fuel forward contracts used for hedging (note 16) - 0.1 - 0.1
Interest rate swaps used for hedging (note 16) - - - -
Notes (forming part of the financial statements) continued
23 Financial instruments (continued)
30 March 2023
Carrying amount Fair value - hedging instruments FVOCI - equity instruments Financial assets at amortised cost Other financial liabilities Total carrying amount
£m £m £m £m £m
Financial assets measured at fair value
Interest rate swaps used for hedging (note 16) 2.0 - - - 2.0
2.0 - - - 2.0
Financial assets not measured at fair value
Investments in Joint Venture veterinary practices (note 16) - - 0.4 - 0.4
Other investments (note 16) - - 2.1 - 2.1
Current trade and other receivables (note 17) - - 19.2 - 19.2
Amounts owed by Joint Venture veterinary practices - funding, trading and - - 21.9 - 21.9
operating loans (note 17)
Cash and cash equivalents (note 18) - - 178.0 - 178.0
Loans to Joint Venture veterinary practices - initial set up loans (note 16) - - 6.6 - 6.6
Loans to Joint Venture veterinary practices - other loans (note 16) - - 1.2 - 1.2
Non-current other receivables (note 16) - - 0.6 - 0.6
- - 230.0 - 230.0
Financial liabilities measured at fair value
Fuel forward exchange contracts used for hedging (note 16) (0.3) - - - (0.3)
Forward exchange contracts used for hedging (note 16) (3.4) - - - (3.4)
Interest rate swaps used for hedging (note 16) (0.4) - - - (0.4)
(4.1) - - - (4.1)
Financial liabilities not measured at fair value
Current lease liabilities (note 12) - - - (83.3) (83.3)
Non-current lease liabilities (note 12) - - - (338.1) (338.1)
Trade payables (note 20) - - - (155.5) (155.5)
Amounts owed to Joint Venture veterinary practices (note 20) - - - (4.5) (4.5)
Other interest-bearing loans and borrowings (note 19) - - - (120.5) (120.5)
- - - (701.9) (701.9)
30 March 2023
Fair value Level 1 Level 2 Level 3 Total
£m £m £m £m
Financial assets measured at fair value
Interest rate swaps used for hedging (note 16) - - 2.0 2.0
Changes in liabilities arising from financing activities
Group
Loans and borrowings Lease liabilities Total
£m £m £m
Balance at 30 March 2023 120.5 421.4 541.9
Changes from financing cash flows
Repayment of borrowings (75.0) - (75.0)
Payment of lease liabilities - (81.7) (81.7)
Total changes from financing cash flows (75.0) (81.7) (156.7)
Other changes
Interest expense on lease liabilities - 13.3 13.3
Additions to lease liabilities - 29.8 29.8
Disposal of lease liabilities - (2.0) (2.0)
Capitalisation of debt issue costs (0.9) - (0.9)
Amortisation of debt issue costs 0.9 - 0.9
Total other changes - 41.1 41.1
Balance at 28 March 2024 45.5 380.8 426.3
Notes (forming part of the financial statements) continued
23 Financial instruments (continued)
Loans and borrowings Lease liabilities Total
£m £m £m
Balance at 31 March 2022 96.9 383.0 479.9
Changes from financing cash flows
Proceeds from loans and borrowings 123.3 - 123.3
Repayment of borrowings (100.0) - (100.0)
Lease incentives received - 22.0 22.0
Payment of lease liabilities - (83.1) (83.1)
Total changes from financing cash flows 23.3 (61.1) (37.8)
Other changes
Interest expense on lease liabilities - 12.4 12.4
Additions to lease liabilities - 87.4 87.4
Disposal of lease liabilities - (0.3) (0.3)
Capitalisation of debt issue costs (0.1) - (0.1)
Amortisation of debt issue costs 0.4 - 0.4
Total other changes 0.3 99.5 99.8
Balance at 30 March 2023 120.5 421.4 541.9
Company
Loans and Total
borrowings
£m £m
Balance at 30 March 2023 97.3 97.3
Changes from financing cash flows
Repayment of borrowings (75.0) (75.0)
Total changes from financing cash flows (75.0) (75.0)
Capitalisation of debt issue costs (0.9) (0.9)
Amortisation of debt issue costs 0.8 0.8
Total other changes (0.1) (0.1)
Balance at 28 March 2024 22.2 22.2
Loans and Total
borrowings
£m £m
Balance at 31 March 2022 96.9 96.9
Changes from financing cash flows
Proceeds from loans and borrowings 100.0 100.0
Repayment of borrowings (100.0) (100.0)
Total changes from financing cash flows - -
Other changes
Amortisation of debt issue costs 0.4 0.4
Total other changes 0.4 0.4
Balance at 30 March 2023 97.3 97.3
Cash flow hedge reserve
2024 2023
£m £m
Foreign currency risk
Inventory purchases (0.6) (2.5)
Commodity price risk
Fuel purchases 0.1 (0.3)
Interest rate risk
Variable rate instruments - 1.2
Commodity price risk Foreign currency risk Interest rate risk
Forward exchange contracts- fuel Forward exchange contracts- inventory Interest rate swaps
2024 2023 2024 2023 2024 2023
£m £m £m £m £m £m
Nominal amount
Carrying amount- asset (note 16) 0.1 - 0.2 - - 2.0
Carrying amount- liability (note 16) - (0.3) (1.0) (3.4) - (0.4)
Changes in the value of hedging instrument recognised in OCI
Amount of hedging reserve transferred to cost of inventory - 0.5 (3.3) 2.2 - 1.6
Net change in fair value of cash flow hedges reclassified to profit or loss (0.3) - - - 1.6 -
Notes (forming part of the financial statements) continued
23 Financial instruments (continued)
The following table provides a reconciliation by risk category of hedging
reserve and analysis of OCI items, net of tax, resulting from cash flow
hedging accounting:
28 March 30 March 2023
2024
£m £m
Balance brought forward (1.6) 3.4
Changes in fair value
Foreign currency risk- inventory purchase 2.6 (5.5)
Commodity risk- fuel 0.4 (0.9)
Interest rate risk (1.6) 0.1
Tax on movements on reserves during the year (0.3) 1.3
Balance carried forward (0.5) (1.6)
Measurement of fair values
The following table shows the valuation techniques used in measuring Level 2
and Level 3 fair values at the balance sheet dates, as well as the significant
unobservable inputs used.
Type Valuation technique Significant unobservable inputs Inter-relationship between significant unobservable inputs and fair value
measurement
Investment in equity securities The fair values of investments in unlisted equity securities are considered to Not applicable Not applicable
be their carrying value as the impact of discounting future cash flows has
been assessed as not material and the investment is non-participatory.
Forward exchange contracts and interest rate swaps Market comparison technique - the fair values are based on broker quotes. Not applicable Not applicable
Similar contracts are traded in an active market and the quotes reflect the
actual transactions on similar instruments.
Other financial liabilities Other financial liabilities include the fair values of the put and call Future earnings performance Fair value linked to increase or decrease in the best estimate of the future
options over the non-controlling interests of subsidiary undertakings. The earnings performance
fair values represent the best estimate of amounts payable based on future
earnings performance discounted to present value.
Hedge accounting
Cash flow hedges
At 28 March 2024 and 30 March 2023, the Group held the following instruments
to hedge exposures to changes in foreign currency and interest rates.
Maturity
1-6 6-12 More than 1 year 1-6 months 6-12 months More than 1 year
months months
2024 2024 2024 2023 2023 2023
Foreign currency risk
Forward exchange contracts
Net exposure (£m) 50.4 29.1 - 50.1 30.8 -
Average GBP-USD forward contract rate 1.24 1.27 - 1.16 1.21 -
Average GBP-EUR forward contract rate 1.14 1.16 - 1.14 1.11 -
Interest rate risk
Interest rate swaps
Net exposure (£m) 50.0 - 100.0 - 50.0
Average fixed interest rate 5.06% - 0.811% - 5.058%
Company
The Company held interest rate swaps as at 28 March 2024 and 30 March 2023
which are valued as above.
Capital management
The Group's objectives when managing capital, which is deemed to be total
equity plus total debt, are to safeguard the Group's ability to continue as a
going concern in order to provide returns for shareholders and benefits for
other stakeholders, through the optimisation of the debt and equity balance,
and to maintain a strong credit rating and headroom on financial covenants.
The Group manages its capital structure and makes appropriate decisions in
light of the current economic conditions and strategic objectives of the
Group.
The Board's policy is to maintain a strong capital base so as to maintain
investor, creditor and market confidence and to sustain future development of
the Group. The funding requirements of the Group are met by the utilisation of
external borrowings together with available cash, as detailed in note 19.
A key objective of the Group's capital management is to maintain compliance
with the covenants set out in the revolving credit facility and to maintain a
comfortable level of headroom over and above these requirements. Management
have continued to measure and monitor covenant compliance throughout the
period and the Group has complied with the requirements set.
Notes (forming part of the financial statements) continued
24 Share-based payments
At 28 March 2024 and 30 March 2023, the Group has five share award plans, all
of which are equity settled schemes.
1 Company Share Ownership Plan ('CSOP')
On 25 February 2014 the Company adopted the CSOP. Part I of the CSOP is tax
approved under Schedule 4 to the Income Tax (Earnings and Pensions) Act 2003
and provides for the grant of tax approved options. Part II of the CSOP
provides for the grant of unapproved options.
The tax approved options under Part I of the CSOP will be exercisable between
the third and tenth anniversary of the date of grant, subject to continued
employment with the Group. These awards will be granted with an exercise price
equal to the market value of the shares at the grant date (as agreed with
HMRC).
(a) Eligibility
All colleagues, including the Executive Directors and Senior Executives, are
eligible to participate in the CSOP, at the discretion of the Remuneration
Committee.
(b) Grant of options
No options may be granted more than ten years after the adoption of the CSOP.
Options under the CSOP will not form part of a colleague's pensionable
earnings.
(c) Vesting and performance
Colleagues who receive options under the CSOP and under the PSP in connection
with Admission will be subject to the same performance conditions described in
Section 1 (d) above in respect of both grants. Colleagues who only receive
options under the CSOP in connection with Admission will not be subject to
performance conditions.
(d) Exercise price
The price at which an option holder may acquire shares on the exercise of an
option shall be determined by the Board but shall not be less than
the greater of market value of a share at the time of grant and its nominal
value. The exercise price is therefore fixed at grant date.
(e) Individual limits
No option may be granted to an eligible colleague under Part I of the CSOP
which would result in the aggregate exercise prices of shares comprised in all
outstanding options granted to him/her under Part I, when aggregated with
outstanding options held under any other tax approved executive share option
scheme established by the Company, exceeding the tax approved limit (currently
£30,000).
In addition, (both under Part I and II of the CSOP) the aggregate exercise
price of shares comprised in options granted to a colleague under the CSOP and
the PSP in any financial year shall not exceed 150% of his/her annual salary
for that year.
For the purposes of these limits, market value will be calculated by reference
to the market value of the shares on or prior to the relevant date of grant
as determined by the Board (following consultation with the Remuneration
Committee) and subject to HMRC approval if applicable.
Part II of the CSOP provides for the grant of unapproved options. This enables
options to be granted under the same terms as Part I of the CSOP but without
complying with the particular requirements of the legislation applicable to
tax approved CSOP Schemes. The provisions of the CSOP that do not apply under
Part II include the £30,000 limit and the need to seek HMRC approval for the
scheme and subsequent amendments (as applicable).
2 Performance Share Plan ('PSP')
On 25 February 2014 the Company adopted the PSP. Awards under the PSP were
made on 17 March 2014 and annually thereafter up until 2017 after which no
further awards were granted. The awards will be exercisable between the third
and tenth anniversary of the grant date, subject to continued employment with
the Group and the satisfaction of performance conditions. These awards were
granted at nil cost.
(a) Eligibility
Only the Executive Directors, Senior Executives and certain other senior
colleagues were selected to participate in the PSP.
(b) Grant of awards
Awards under the PSP will not form part of a colleague's pensionable earnings.
Awards are not transferable (other than on death) without the consent of the
Remuneration Committee.
(c) Exercise price
The price at which a colleague may acquire shares on the exercise or vesting
of an award under the PSP shall be determined by the Remuneration Committee on
the date of grant, and may, if the Remuneration Committee determines, be nil
or nominal value only.
(d) Scheme limits
The number of newly issued shares over which (or in respect of which) awards
may be granted under the PSP on any date shall be limited so that: (i) the
total number of shares issued and issuable in respect of options or awards
granted in any ten year period under the PSP and any other discretionary share
option scheme of the Company (including the RSA and the CSOP but other than to
satisfy dividend equivalent payments) is restricted to 5% of the Company's
issued shares calculated at the relevant time; and (ii) the total number of
shares issued and issuable pursuant to options or awards granted in any ten
year period under the PSP and any other employee share scheme operated by the
Company (including the CSOP, SAYE and RSA but other than to satisfy dividend
equivalent payments) is restricted to 10% of the Company's issued shares
calculated at the relevant time.
For the purposes of these limits, no account will be taken of options or
awards granted before, on or in connection with Admission and no account will
be taken of options or awards which have lapsed, been surrendered or otherwise
become incapable of exercise or vesting. Shares held in treasury will be
treated as newly issued shares for the purposes of these limits (as long as
this is required by institutional investor guidelines), but (for the
avoidance of doubt) shares acquired in the market will not.
(e) Individual limits
The aggregate market value of shares comprised in awards granted to a
colleague under the PSP, RSA and the CSOP in any financial year shall not
exceed 150% of their annual salary for that year.
For the purposes of awards granted on (or before) Admission, market value for
these purposes was calculated by reference to the Offer Price. For the
purposes of awards granted following Admission, market value for these
purposes will be calculated by reference to the market value of the shares on
the relevant date of grant as determined by the Board (following consultation
with the Remuneration Committee) in its absolute discretion.
Notes (forming part of the financial statements) continued
24 Share-based payments (continued)
(f) Performance
The Matching Awards granted on 17 March 2014 vested subject to the
satisfaction of the performance conditions outlined below. To the extent that
any future awards are granted, different conditions may apply (in the absolute
discretion of the Remuneration Committee).
The performance conditions were as follows:
• 75% of the Matching Award was subject to the CAGR in the Company's earnings
per share ('EPS') over three financial years, namely FY15, FY16 and FY17
(together the 'Performance Period') (which, for the avoidance of doubt, ended
on 30 March 2017). If the CAGR in the Company's EPS was 10%, then 10% of the
total Matching Award would vest. If the CAGR in the Company's EPS was 17.5% or
more, then 75% of the total Matching Award would vest. Vesting was on a
straight-line basis between these two points. For the avoidance of doubt, if
the CAGR in the EPS was less than 10% over the Performance Period then the
amount of the Matching Award which would vest under this EPS performance
condition would be nil.
• 25% of the total Matching Award was subject to the Company's total shareholder
return ('TSR') as compared to a comparator group made up of a selected group
of retail companies over the Performance Period. Vesting of 6.25% of the total
Matching Award would occur for median performance. Vesting of the maximum 25%
of the total Matching Award would occur for upper quartile performance or
above. Vesting would occur on a straight-line basis between these two points.
If the Company's TSR performance over the Performance Period was below median,
then the amount of the Matching Award which would vest under this TSR
performance condition would be nil.
• To the extent vested as to performance, Matching Awards became exercisable in
three equal amounts on the third, fourth and fifth anniversary of 17 March
2014, but subject to continued employment with the Group.
3 Save As You Earn ('SAYE')
On 25 February 2014, the Company adopted the SAYE (which was registered with
and self-certified with HMRC on 4 April 2015). The rules of the SAYE were
adopted pursuant to Schedule 3 of the Income Tax (Earnings and Pensions) Act
2003 and provide for the grant of tax approved options. In September each
year, the Company issues invitations under the rules of the SAYE which
provides eligible colleagues with an opportunity to receive share options at a
20% discount to the market price. The maximum monthly savings is £500 per
month. During the 52 weeks ending 28 March 2024, the Executive Directors have
elected to participate in the SAYE, along with 10.95% of eligible colleagues.
The options are granted once a year, and in normal circumstances they are not
exercisable until completion of a savings period, beginning on 1 December each
year, and will then be exercisable for a period of six months following
completion of the relevant savings period.
(a) Eligibility
All colleagues and full-time Directors of the Group, who have been in
continuous service for such period of time (not exceeding five years) as may
be determined by the Board prior to the relevant date of grant of an option
and who are liable to UK income tax, are eligible to participate in the SAYE.
Participation may also be offered, at the discretion of the Board (taking
account of the recommendations of the Remuneration Committee), to other
Directors or employees who otherwise do not satisfy all of the above criteria,
although Non-Executive Directors are not eligible to participate in the SAYE.
(b) Issue of invitations
Invitations to participate in the SAYE may be made during each 42 day period
from (and including) (i) the date on which any amendment to the SAYE is
approved or adopted by the Company's shareholders, (ii) the announcement of
the Company's final or interim results for any financial period, (iii) the
occurrence of an event which the Remuneration Committee considers to be an
non-underlying event concerning the Group or (iv) changes to the legislation
affecting tax approved SAYE option schemes coming into effect. If any of the
above periods is a 'close period' as a result of the application of the Model
Code for Securities Transactions by Directors of Listed Companies (or as a
result of the Company's equivalent internal share dealing rules) and the
Company is prohibited from issuing invitations and/or granting options as a
result, then invitations may be made within 42 days of the end of the close
period.
Invitations may be issued by the trustee of an employee benefit trust. No
invitations may be issued or options granted more than ten years after
the adoption of the SAYE.
(c) Exercise price
The price at which an option holder may acquire shares on the exercise of an
option shall be determined by the Board but shall not be less than
the greater of 80% of the market value of a share at the time of grant and
its nominal value.
(d) Savings contract
Options may be granted by the Board or the trustee of an employee benefit
trust. Upon applying for an option, the colleague will be required to enter
into an approved savings contract with a savings institution nominated by the
Company which lasts for three years. The maximum amount which an employee is
permitted to contribute under SAYE contracts is £500 per month. The Board may
set lower savings limits than this for different colleagues by reference to
objective criteria such as levels of salary or length of service. The minimum
contribution is £5 per month (or such greater amount as the Board may
specify, not to exceed £10). The total exercise price of the shares over
which the option is granted may not exceed the aggregate of the monthly
contributions and bonus payable at the end of the colleague's related SAYE
contract.
(e) Scheme limits
The number of newly issued shares over which (or in respect of which) options
may be granted under the SAYE on any date of grant shall be limited so that
the total number of shares issued or capable of being issued in any ten year
period under all the Company's employee share schemes (including the CSOP, PSP
and RSA but other than to satisfy dividend equivalent payments) is restricted
to 10% of the Company's issued shares calculated at the relevant time. Any
options or rights to acquire shares granted before, on or in connection with
Admission will be excluded from this limit, and no account will be taken of
options or awards which have lapsed, been surrendered or otherwise become
incapable of exercise or vesting.
(f) Exercisability
Options will normally be exercisable during a period of six months following
the allocation of a bonus under the related SAYE contract and will normally
lapse upon cessation of employment. Earlier exercise is, however, permitted if
the colleague dies or leaves employment through injury, disability, redundancy
or retirement or where a colleague leaves employment of the Group by reason of
his employing company ceasing to be a member of the Group, or if the
undertaking in which he is employed is sold outside the Group. Early exercise
will also be permitted in the event of a takeover, reconstructions or
voluntary winding up of the Company.
Notes (forming part of the financial statements) continued
24 Share-based payments (continued)
4 Restricted Stock Plan ('RSA')
On 20 July 2017 the Company adopted the RSA. Awards under the RSA were made on
20 July 2017 and annually thereafter and will be exercisable between the
third and tenth anniversary of this date, subject to continued employment with
the Group and the satisfaction of performance conditions. These awards are
granted at nil cost.
(a) Eligibility
All colleagues, including the Executive Directors and Senior Executives, are
eligible to participate in the RSA, at the discretion of the Remuneration
Committee.
(b) Grant of awards
Awards under the RSA will not form part of a colleague's pensionable earnings.
Awards are not transferable (other than on death) without the consent of the
Remuneration Committee.
(c) Exercise price
The price at which a colleague may acquire shares on the exercise or vesting
of an award under the RSA shall be determined by the Remuneration Committee on
the date of grant, and may, if the Remuneration Committee determines, be nil
or nominal value only.
(d) Scheme limits
The number of newly issued shares over which (or in respect of which) awards
may be granted under the RSA on any date shall be limited so that: (i) the
total number of shares issued and issuable in respect of options or awards
granted in any ten year period under the RSA and any other discretionary share
option scheme of the Company (including the PSP and the CSOP but other than to
satisfy dividend equivalent payments) is restricted to 5% of the Company's
issued shares calculated at the relevant time; and (ii) the total number of
shares issued and issuable pursuant to options or awards granted in any ten
year period under the RSA and any other employee share scheme operated by the
Company (including the CSOP, SAYE and PSP but other than to satisfy dividend
equivalent payments) is restricted to 10% of the Company's issued shares
calculated at the relevant time.
For the purposes of these limits, no account will be taken of options or
awards granted before, on or in connection with Admission and no account will
be taken of options or awards which have lapsed, been surrendered or otherwise
become incapable of exercise or vesting. Shares held in treasury will be
treated as newly issued shares for the purposes of these limits (as long as
this is required by institutional investor guidelines), but (for the
avoidance of doubt) shares acquired in the market will not.
(e) Individual limits
The aggregate market value of shares comprised in awards granted to a
colleague under the RSA, PSP and the CSOP in any financial year shall not
exceed 150% of their annual salary for that year. Market value for these
purposes will be calculated by reference to the market value of the shares on
the relevant date of grant as determined by the Board (following consultation
with the Remuneration Committee) in its absolute discretion.
Fair value of share awards
The expected volatility is based on historical volatility of a peer group of
companies over a relevant period prior to award. The expected life is the
average expected period to exercise, which has been taken as three years. The
risk free rate of return is the yield on zero-coupon UK government bonds with
a life equal to this expected life.
Options are valued using a Black-Scholes option-pricing model for the
non-market based (EPS element) performance conditions and a Monte-Carlo
simulation for the market-based (TSR element) performance conditions.
Special provisions allow early exercise in the case of death, injury,
disability, redundancy, retirement or because the Company which employs
the option holder ceases to be part of the Group or in the event of a change
in control, reconstruction or winding up of the Company.
5 Deferred Share Bonus Plan ('DSBP')
On 24 March 2022 the Company adopted the DSBP. Awards under the DSBP represent
the deferral of the discretionary bonus awarded to eligible colleagues into
shares. Awards under the DSBP will be exercisable between the second
anniversary of the first day following the end of the Year in respect of which
the Bonus in question is earned or would have been earned notwithstanding that
it was deferred and the tenth anniversary of the Date of Grant. These awards
are granted at nil cost.
(a) Eligibility
All colleagues, including the Executive Directors and Senior Executives, are
eligible to participate in the DSBP, at the discretion of the Remuneration
Committee.
(b) Grant of awards
Awards under the DSBP will not form part of a colleague's pensionable
earnings. Awards are not transferable (other than on death) without the
consent of the Remuneration Committee.
(c) Exercise price
The price at which a colleague may acquire shares on the exercise or vesting
of an award under the DSBP shall be determined by the Remuneration Committee
on the date of grant, and may, if the Remuneration Committee determines, be
nil or nominal value only.
(d) Scheme limits
The number of newly issued shares over which (or in respect of which) awards
may be granted under the DSBP on any date shall be limited so that: (i) the
total number of shares issued and issuable in respect of options or awards
granted in any ten year period under the DSBP and any other discretionary
share option scheme of the Company (including the PSP and the CSOP but other
than to satisfy dividend equivalent payments) is restricted to 5% of the
Company's issued shares calculated at the relevant time; and (ii) the total
number of shares issued and issuable pursuant to options or awards granted in
any ten year period under the DSBP and any other employee share scheme
operated by the Company (including the CSOP, SAYE and PSP but other than to
satisfy dividend equivalent payments) is restricted to 10% of the Company's
issued shares calculated at the relevant time.
Notes (forming part of the financial statements) continued
24 Share-based payments (continued)
5 Deferred Share Bonus Plan ('DSBP') (continued)
For the purposes of these limits, no account will be taken of options or
awards granted before, on or in connection with Admission and no account will
be taken of options or awards which have lapsed, been surrendered or otherwise
become incapable of exercise or vesting. Shares held in treasury will be
treated as newly issued shares for the purposes of these limits (as long as
this is required by institutional investor guidelines), but (for the
avoidance of doubt) shares acquired in the market will not.
(e) Individual limits
The aggregate market value of all the shares awarded to an eligible employee
in respect of any financial year (calculated on the Date of Grant) comprised
in awards granted to them in respect of that financial year under the plan,
shall not exceed 100 per cent. of the bonus the eligible employee has agreed
to, or has been required to, defer for that financial year.
Fair value of share awards
The expected volatility is based on historical volatility of a peer group of
companies over a relevant period prior to award. The expected life is the
average expected period to exercise, which has been taken as three years. The
risk free rate of return is the yield on zero-coupon UK government bonds with
a life equal to this expected life.
Options are valued using a Black-Scholes option-pricing model for the
non-market based (EPS element) performance conditions and a Monte-Carlo
simulation for the market-based (TSR element) performance conditions.
Special provisions allow early exercise in the case of death, injury,
disability, redundancy, retirement or because the Company which employs
the option holder ceases to be part of the Group or in the event of a change
in control, reconstruction or winding up of the Company.
The key assumptions used in the fair value of the awards were as follows:
RSA PSP
2023 2022 2021 2020 2019 2018 2017 2016 2015
At grant date
Share price £3.75 £3.47 £4.57 £2.28 £1.87 £1.37 £2.59 £2.75 £2.45
Exercise price £0.00 £0.00 £0.00 £0.00 £0.00 £0.00 £0.00 £0.00 £0.00
Expected volatility 37% 32% 32% 32% 32% 32% 32% 30% 30%
Option life (years) 10 10 10 10 10 10 10 10 10
Expected dividend yield 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00%
Risk free interest rate n/a n/a n/a n/a n/a n/a 0.005 0.0107 0.0107
Weighted average fair value of options granted 3.75 3.47 £4.57 £2.28 £1.87 £1.37 £2.06 £2.06 £2.06
DSBP CSOP SAYE
2023 2022 2016 2015 2023 2022 2021 2020
At grant date
Share price £3.78 £3.10 £2.75 £2.31 £3.49 £3.05 £5.13 £2.87
Exercise price £0.00 £0.00 £2.75 £2.31 £2.79 £2.44 £4.10 £2.29
Expected volatility 37% 37% 32% 37% 37% 37% 33% 32%
Option life (years) 10 10 10 10 3 3 3 3
Expected dividend yield 2% 2% 2% 2% 2% 2% 2% 2%
Risk free interest rate n/a n/a 2% 2% 4% 1% 1% 0%
Weighted average fair value of options granted £3.78 £3.10 £0.89 £0.75 £1.36 £1.16 £1.68 £0.95
For both the RSA and DSBP awards, the fair value is the share price at the
date of the grant so the risk free rate has no impact on the fair value
calculation.
Movements in awards under share-based payment schemes:
PSP CSOP SAYE RSA DSBP Total
000 000 000 000 000 000
Outstanding at start of year 2 328 3,891 5,007 - 9,228
Granted - - 1,364 1,797 250 3,411
Forfeited - (11) (780) (815) - (1,606)
Exercised - (114) (1,060) (1,685) - (2,859)
Lapsed (2) (2) (17) (17) - (38)
Outstanding at end of year - 201 3,398 4,287 250 8,136
Weighted average exercise price - 2.60 2.68 - - NA
The Group income statement charge recognised in respect of share-based
payments for the 52 week period ended 28 March 2024 is £5.9m (52 week period
ended 30 March 2023: £4.9m).
Notes (forming part of the financial statements) continued
25 Commitments
Capital commitments
At 28 March 2024, the Group is committed to incur capital expenditure of
£1.9m (30 March 2023: £3.0m). At 28 March 2024, the Group has a commitment
to increase the loan funding to Joint Venture companies of £0.3m (30 March
2023: £0.4m), this increase in funding is written into the Joint Venture
agreements and becomes payable when certain criteria are met.
26 Contingencies
Veterinary practices
Provisions are maintained by the Group, where necessary, against certain
balances held with the veterinary practices. During the period, the Group also
had in place certain guarantees over the bank loans taken out by a number of
veterinary practice companies in which it holds an investment
in non-participatory share capital. Under IFRS 9, the Group holds provision
against a proportion of the guarantees where the practices are in default in
accordance with the policy set out in note 1.16. At 28 March 2024, the total
amount of bank overdrafts and loans guaranteed by the Group amounted
to £4.5m (30 March 2023: £7.6m). The Group is a guarantor for the lease for
veterinary practices that are not located within Pets at Home stores. The
Group is also a guarantor to a small number of third parties where the lease
has been reassigned.
Exemption from audit by parent guarantee
The following wholly owned subsidiaries of the Company are covered by a
guarantee provided by Pets at Home Group Plc and are consequently entitled to
an exemption under s479A from the requirement of the Act relating to the audit
of individual accounts. Under this guarantee, the Group will guarantee all
outstanding liabilities of these entities. No liability is expected to arise
under the guarantee. The entities covered by this guarantee are disclosed
below.
Company Registered number
ABTW Limited 07715283
Accrington Vets4Pets Limited 10015704
Alton Vets4Pets Limited 09639868
Andover Vets4Pets Limited 08132407
Bangor Wales Vets4Pets Limited 08314827
Bearsden Vets4Pets Limited 07780175
Bedminster Vets4Pets Limited 09267870
Belfast Stormont Vets4Pets Limited 09022077
Bicester Vets4Pets Limited 10285804
Blackpool Warbreck Vets4Pets Limited 08394978
Bolton Central Vets4Pets Limited 11047742
Bonnyrigg Vets4Pets Limited 10757330
Borehamwood Vets4Pets Limited 09319066
Bourne Vets4Pets Limited 10200670
Bracknell Vets4Pets Limited 10605544
Brand Developments Limited 00039522
Brighton Vets4Pets Limited 13539268
Carmarthen Vets4Pets Limited 09498169
Clacton Vets4Pets Limited 13668587
Clitheroe Vets4Pets Limited 09878308
Companion Care (Ballymena) Limited 08294444
Companion Care (Banbury) Limited 08606393
Companion Care (Barnsley Cortonwood) Limited 08314805
Companion Care (Chippenham) Limited 08107702
Companion Care (Ely) Limited 04417089
Companion Care (Exeter Marsh) Limited 08314727
Companion Care (Exeter) Limited 04930076
Companion Care (Farnborough) Limited 07673889
Companion Care (Farnham) Limited 07877541
Companion Care (Kings Lynn) Limited 06797982
Companion Care (Macclesfield) Limited 08285995
Companion Care (Newport) Limited 08425358
Companion Care (Nottingham) Limited 04289970
Companion Care (Salisbury) Limited 06457719
Companion Care (Services) Limited 04141142
Companion Care (Speke) Limited 07149744
Companion Care (Stratford-upon-avon) Limited 07329166
Companion Care (Telford) Limited 04417091
Companion Care Management Services Limited 08878037
Corby Vets4Pets Limited 08163294
Craigavon Vets4Pets Limited 08846831
Davidsons Mains Vets4Pets Limited 07726992
Denbigh Vets4Pets Limited 10976376
Didcot Vets4Pets Limited 14091352
East Kilbride South Vets4Pets Limited 09628917
Ellesmere Port Vets4Pets Limited 09725644
Evesham Vets4Pets Limited 09269582
Gamston Vets4Pets Limited 05665158
Gillingham Vets4Pets Limited 10970617
Grantham Vets4Pets Limited 08361049
Guildford Vets4Pets Limited 13470077
Haverfordwest Vets4Pets Limited 09485504
Horsham Vets4Pets Limited 14345928
Huddersfield Vets4Pets Limited 07207906
Inverurie Vets4Pets Limited 11056047
Kendal Vets4Pets Limited 10163314
Larne Vets4Pets Limited 11121715
Leeds Kirkstall Vets4Pets Limited 10291543
Leicester St Georges Vets4Pets Limited 09881176
Leigh Vets4Pets Limited 10601393
Linlithgow Vets4Pets Limited 09966547
Liverpool OS Vets4Pets Limited 06959208
Maidstone Vets4Pets Limited 05171954
Malvern Vets4Pets Limited 10516552
Market Harborough Vets4Pets Limited 10602806
Marlborough Vets4Pets Limited 09869384
Melton Mowbray Vets4Pets Limited 07893688
Monmouth Vets4Pets Limited 10756991
Musselburgh Vets4Pets Limited 10425760
Newbury Vets4Pets Limited 04633009
Newton Mearns Vets4Pets Limited 07957431
Newtownards Vets4Pets Limited 10067571
Northwich Vets4Pets Limited 11107287
Pet Advisory Services Limited 09180974
Pets at Home (ESOT) Limited 03911784
Pets at Home No.1 Limited 08887355
Pets at Home Holdings Limited 03864149
Pet City Limited 02466773
Pet City Holdings Limited 02342109
Pet City Resources Limited 02634797
Pet Investment Limited 04428715
Pets at Home Vet Group Limited 08595290
Prescot Vets4Pets Limited 08878815
Rawtenstall Vets4Pets Limited 09009519
Redditch Vets4Pets Limited 05612150
Runcorn Vets4Pets Limited 11446894
Sheldon Vets4Pets Limited 08822150
South Shields Quays Vets4Pets Limited 09848857
St Neots Vets4Pets Limited 09811640
Staines Vets4Pets Limited 13584062
Stamford Vets4Pets Limited 14179951
Sudbury Vets4Pets Limited 09916308
Thamesmead Vets4Pets Limited 09881179
Tilehurst Vets4Pets Limited 10573329
Tiverton Vets4Pets Limited 11023079
Uttoxeter Vets4Pets Limited 11145982
Vets4Pets (Services) Limited 04317414
Vets4Pets Limited 00038174
Vets4Pets Services Limited 05055601
Vets4Pets UK Limited 03940967
Vets4Pets Veterinary Group Limited 04263054
VetsDirect Limited SC230445
Notes (forming part of the financial statements) continued
26 Contingencies (continued)
Company Registered number
Wakefield Vets4Pets Limited 04262693
Wallasey Bidston Moss Vets4Pets Limited 09190138
Wellingborough Vets4Pets Limited 07620413
Wokingham Vets4Pets Limited 09869355
Wrexham Vets4Pets Limited 07103838
27 Related parties
Joint Venture veterinary practice transactions
The Group has entered into a number of arrangements with third parties in
respect of veterinary practices. These veterinary practices are deemed to be
related parties due to the factors explained in note 1.4. Financial
commitments provided to related party veterinary practices for funding are set
out in note 25.
During the period, the Group had in place certain guarantees over the bank
loans taken out by a number of veterinary practice companies in which it holds
an investment in non-participatory share capital. At the end of the period,
the total amount of bank overdrafts and loans guaranteed by the Group amounted
to £4.5m (30 March 2023: £7.6m).
The transactions entered into during the period and the balances outstanding
at the end of the period are as follows:
28 March 2024 £m 30 March 2023 £m
Transactions
- Fees for services provided to Joint Venture veterinary practices 89.3 77.2
- Rental and other occupancy charges to Joint Venture veterinary practices 12.7 12.2
Total income from Joint Venture veterinary practices 102.0 89.4
1.0 0.5
Acquisitions
- Consideration for Joint Venture veterinary practices acquired (note 10)
Balances
Included within investments
- Investments
- Capital Contributions for extensions and improvements of practices 2.5 -
(note 16)
- B Share Capital (note 16) 0.2 0.4
Included within trade and other receivables (note 17):
- Operating loans
- Gross value of operating loans 8.8 13.8
- Allowance for expected credit losses held for operating loans (3.0) (3.4)
- Net operating loans 5.8 10.4
- Trading balances 10.9 11.5
Included within other financial assets and liabilities (note 16):
- Loans to Joint Venture veterinary practices - initial set up loans
- Gross value of initial set up loans 5.8 7.6
- Allowance for expected credit losses held for initial set up loans (0.6) (1.0)
- Net initial set up loans 5.2 6.6
- Loans to Joint Venture veterinary practices - other loans (note 16)
- Gross value of other loans 0.5 1.2
- Allowance for expected credit losses held for other loans - -
- Net other loans 0.5 1.2
Included within trade and other payables (note 20):
- Trading balances (0.8) (4.5)
Total amounts receivable from veterinary practices (before provisions) 25.2 29.6
Fees for services provided to related party veterinary practices are included
within revenue and relate to charges for support services offered in such
areas as clinical development, promotion and methods of operation as well as
service activities including accountancy, legal and property. In accordance
with IFRS15, revenue in the 52 week period ended 28 March 2024 and the 52 week
period ended 30 March 2023 excludes irrecoverable fee income from Joint
Venture veterinary practices.
Notes (forming part of the financial statements) continued
27 Related parties (continued)
Funding for new practices represents the amounts advanced by the Group to
support veterinary practice opening costs. The funding is short term and the
related party Joint Venture veterinary practice draws down their own bank
funding to settle these amounts outstanding with the Group shortly after
opening.
Trading balances represent costs incurred and income received by the Group in
relation to the services provided to the Joint Venture veterinary practices
that have yet to be recharged.
Operating loans represent amounts advanced to related party Joint Venture
veterinary practices to support their working capital requirements and longer
term growth. The loans advanced to the practices are interest free and either
repayable on demand or repayable within 90 days of demand. No facility exists
and the levels of loans are monitored in relation to review of the practices
performance against business plan. Based on the projected cash flow forecast
on a practice by practices basis, the funding is often expected to be required
for a number of years. As practices generate cash on a monthly basis it is
applied to the repayment of brought forward operating loans. For immature
practices, loan balances may increase due to operating requirements. The
balances above are shown net of allowances for expected credit losses held for
operating loans of £3.0m (30 March 2023: £3.4m).
Loans to Joint Venture veterinary practices for other related parties - other
loans are provided to Joint Venture veterinary practice companies trading
under the Companion Care and Vets4Pets brands, in which the Group's share
interest is non-participatory. These loans represent a long-term investment in
the Joint Venture, supporting their initial set up and working capital, and
are held at amortised cost under IFRS9. The balances above are shown net of
allowances for expected credit losses held for initial set up loans of £0.6m
(30 March 2023: £1.0m).
In the 52 week period ended 28 March 2024, the value of loans written off
recognised in the income statement amounted to £1.6m which relates to
operating loans. In the 52 week period ended 30 March 2023 the value of loans
written off recognised in the income statement amounted to £2.0m, which
relates to operating loans.
At 28 March 2024, the Group had a commitment to increase the loan funding to
Joint Venture companies of £0.3m (30 March 2023: £0.4m); this increase in
funding is written into the Joint Venture agreements and becomes payable when
certain criteria are met.
The Group is a guarantor for the leases for veterinary practices that are not
located within Pets at Home stores.
Key management personnel
Details of remuneration paid to key management personnel are set out in note
4.
28 Investment in subsidiaries
Company
Investments in subsidiaries
£m
At 28 March 2024 and 30 March 2023 936.2
Impairment testing
Management have conducted a full impairment review which has been undertaken
on the Group's cash generating units of which the Company's investments form
part. Management considers whether any impairment triggers existed by
comparing the net assets value of the subsidiary to the carrying value of the
investment. Management have concluded that under IAS36, no impairment trigger
has been identified with regard to the Company's investments in subsidiaries.
Registered office address
Pets at Home (Asia) Limited: Units 704 5A, 7/F, Tower B, Manulife Financial
Centre, 223-231 Wai Yip Street, Kwun Tong, Kowloon, Hong Kong
PAH Pty Limited: Herbert Greer and Rundle, Level 21, 385 Bourke Street,
Melbourne, VIC 3000, Australia
Pure Pet Food Limited: Unit 6, Brookmills, Saddleworth Road, Greetland,
Halifax, West Yorkshire, England, HX4 8LZ
Dog Stay Limited: 305 Regents Park Road, Finchley, London, England, N3 1DP
VetsDirect Limited: Dickson Minto, 16 Charlotte Square, Edinburgh, Scotland,
EH2 4DF
Project Blu Limited: 34 Cardiff Road, Dinas Powys, Wales CF64 4JS
Good Dog Food Limited ('Meatly'): Hill Dickinson Llp, The Broadgate Tower, 20
Primrose Street, London, United Kingdom, EC2A 2EW
The registered office of all the remaining companies in which the Group has an
interest in the share capital is Epsom Avenue, Stanley Green, Handforth,
Cheshire, England SK9 3RN.
Group
In the 52 week period ended 28 March 2024 the Group acquired 100% of the 'A'
shares of eight companies and 75% of the 'A' shares of one company. These
practices were previously accounted for as Joint Venture veterinary practices
as the Group held 100% of the non-participatory 'B' ordinary shares.
Acquisition of the 'A' shares has led to the control and consolidation of
these companies. A detailed explanation for the basis of consolidation can be
found in note 1.4. Further details of these acquisitions can be found in note
10.
The Group also invested in 8.5% of the ordinary share capital of Good Dog Food
Limited ('Meatly'), a sustainable pet food company for a consideration of
£1.0m.
The group fully impaired the investment in Dog Stay Limited ('Tailster') and
£1.1m has been recognised as a non-underlying impairment charge (see note 3).
Notes (forming part of the financial statements) continued
28 Investment in subsidiaries (continued)
Details of the subsidiary undertakings are as follows:
Company Holding Country of incorporation Class of shares held At 28 March 2024 % At 30 March 2023 %
Brand Development Limited Indirect Guernsey Ordinary 100 100
Companion Care (Services) Limited Indirect United Kingdom Ordinary 100 100
Companion Care Management Services Limited Indirect United Kingdom Ordinary 100 100
Les Boues Limited Indirect Jersey Ordinary 100 100
PAH Pty Limited Indirect Australia Ordinary 100 100
Pet Advisory Services Limited Indirect United Kingdom Ordinary 100 100
Pet Investments Limited Indirect United Kingdom Ordinary 100 100
Pets at Home (Asia) Limited Indirect Hong Kong Ordinary 100 100
PAH Financial Services Limited Indirect United Kingdom Ordinary 100 100
Pets at Home Holdings Limited Indirect United Kingdom Ordinary 100 100
Pets at Home Limited Indirect United Kingdom Ordinary 100 100
Pets at Home No.1 Limited Direct United Kingdom Ordinary 100 100
Pets at Home Superstores Limited Indirect United Kingdom Ordinary 100 100
Pets at Home Vets Group Limited Indirect United Kingdom Ordinary 100 100
Pets at Home (ESOT) Limited Indirect United Kingdom Ordinary 100 100
Pet City Holdings Limited Indirect United Kingdom Ordinary 100 100
Pet City Limited Indirect United Kingdom Ordinary 100 100
Pet City Resources Limited Indirect United Kingdom Ordinary 100 100
Vets4Pets (Services) Limited Indirect United Kingdom Ordinary 100 100
Vets4Pets Holdings Limited Indirect Guernsey Ordinary 100 100
Vets4Pets I.P. Limited Indirect Guernsey Ordinary 100 100
Vets4Pets Services Limited Indirect United Kingdom Ordinary 100 100
Vets4Pets UK Limited Indirect United Kingdom Ordinary 100 100
Vets4Pets Limited Indirect Guernsey Ordinary 100 100
Vets4Pets Veterinary Group Limited Indirect United Kingdom Ordinary 100 100
VetsDirect Limited Indirect United Kingdom Ordinary 100 100
Accrington Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Addlestone Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Alton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Andover Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Aylesbury Berryfields Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bangor Wales Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bearsden Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bedminster Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Belfast Stormont Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bicester Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bishop Auckland Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Blackpool Warbreck Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bodmin Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bolton Central Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bonnyrigg Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Borehamwood Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bourne Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bracknell Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bradford Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bramley Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bramley Vets4Pets (Newco) Limited Indirect United Kingdom Ordinary 100 100
Bridlington Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Brighton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Bromborough Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Cambridge Perne Road Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Canvey Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Carmarthen Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Chorley Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Clacton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Clitheroe Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Ballymena) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Banbury) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Barnsley Cortonwood) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Chippenham) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Ely) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Exeter Marsh) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Exeter) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Farnborough) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Farnham) Limited Indirect United Kingdom Ordinary 100 50
Companion Care (Kendal) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Kings Lynn) Limited Indirect United Kingdom Ordinary 100 50
Companion Care (Llantrisant) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Macclesfield) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Newport) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Nottingham) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Salisbury) Limited Indirect United Kingdom Ordinary 100 50
Companion Care (Speke) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Stratford-Upon-Avon) Limited Indirect United Kingdom Ordinary 100 100
Companion Care (Telford) Limited Indirect United Kingdom Ordinary 100 50
Corby Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Coventry Canley Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Craigavon Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Crosby Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Davidsons Mains Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Denbigh Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Didcot Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Dundee Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
East Grinstead Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
East Kilbride South Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Ellesmere Port Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Evesham Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Gamston Vets4Pets Limited Indirect United Kingdom Ordinary 75 50
Gillingham Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Grantham Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Great Yarmouth Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Guildford Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Haverfordwest Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Hemsworth Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Hexham Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Horden Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Horsham Vets4Pets Limtied Indirect United Kingdom Ordinary 100 100
Huddersfield Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Inverness Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Inverurie Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Kendal Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Kingswood Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Larne Vets4Pets Limited Indirect United Kingdom Ordinary 100 50
Leeds Kirkstall Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Leicester St Georges Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Leigh Vets4Pets Limited Indirect United Kingdom Ordinary 100 50
Leven Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Linlithgow Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Littleover Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Liverpool OS Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Long Eaton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Maidstone Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Malvern Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Market Harborough Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Marlborough Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Melton Mowbray Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Mexborough Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Milton Keynes Broughton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Monmouth Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Musselburgh Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Newark Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Newbury Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Newhaven Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Newton Mearns Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Newtownards Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Northwich Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Norwich Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Nottingham Castle Marina Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Pentland Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Perth Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Peterlee Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Poynton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Prescot Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Rawtenstall Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Redditch Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Ripon Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Runcorn Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Scunthorpe Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Selby Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Sheffield Heeley Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Sheldon Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Shepton Mallet Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
South Shields Quays Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
St Austell Vets4Pets Limited Indirect United Kingdom Ordinary 95 95
St Neots Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Staines Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Stocksbridge Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Stoke-On-Trent Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Sudbury Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Teesside Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Thamesmead Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
The Heart of Dulwich Veterinary Care Limited Indirect United Kingdom Ordinary 100 100
Thornbury Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Tilehurst Vets4Pets Limited Indirect United Kingdom Ordinary 100 50
Tiverton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Uckfield Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Uttoxeter Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Wakefield Vets4Pets Limited Indirect United Kingdom Ordinary 100 50
Wallasey Bidston Moss Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Warrington Winnick Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Wellingborough Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
West Drayton Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Wokingham Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Wrexham Vets4Pets Limited Indirect United Kingdom Ordinary 100 100
Investments in Joint Venture practices and other investments
The Group holds an indirect interest in the share capital of the following
companies:
Company Holding Country of incorporation Class of shares held At 28 March 2024 % At 30 March 2023 %
Aberdeen North Vets4Pets Limited Indirect United Kingdom Ordinary 50 100
Aberdeen Vets4Pets Limited Indirect United Kingdom Ordinary 50 100
Abingdon Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
ABTW Limited Indirect United Kingdom Ordinary 50 50
Airdrie Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Alsager Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Altrincham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Amesbury Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bagshot Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bangor Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Barnsley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Barnstaple Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Barnwood Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Barry Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bath Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bedford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bedlington Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Beeston Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Beverley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Biggleswade Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bishops Stortford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bishopston Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bitterne Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Blackburn Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Blackheath Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Blackpool Squires Gate Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Blackwood Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bolton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bracknell Peel Centre Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bradford Idle Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Brighouse Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bristol Emerson Green Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bristol Imperial Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bristol Kingswood Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bristol Longwell Green Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bromsgrove Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Buckingham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bulwell Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Burscough Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Burton-On-Trent Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bury St Edmunds Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Bury Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Byfleet Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Caerphilly Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Camborne Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cannock Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Canterbury Sturry Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cardiff Ely Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cardiff Newport Road Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Carlisle Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Carrickfergus Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Castleford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Catterick Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Chadwell Heath Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cheadle Hulme Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Chester Caldy Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Chester Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Chesterfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cirencester Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Clevedon Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cleveleys Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Clifton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Clowne Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Coalville Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Colchester Layer Road Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Colchester Vets4Pets Advanced Practice Limited Indirect United Kingdom Ordinary 50 50
Colne Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Aintree) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Andover) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Ashford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Ashton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Aylesbury) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Ayr) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Basildon Pipps Hill) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Basildon) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Basingstoke) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Beckton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bedford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Belfast) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bishopbriggs) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bletchley) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bolton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bournemouth) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Braintree) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Brentford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bridgend) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bridgwater) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Brislington) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Bristol Filton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Broadstairs) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Burgess Hill) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Cambridge Beehive) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Cambridge) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Cannock) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Canterbury) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Cardiff) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Charlton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Chatham) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Chelmsford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Cheltenham) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Chesterfield) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Chichester) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Chingford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Christchurch) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Colchester) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Corstorphine) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Coventry Walsgrave) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Cramlington) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Crawley) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Crayford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Croydon) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Derby Kingsway) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Derby) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Dunstable) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Eastbourne) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Enfield) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Falmouth) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Fareham Collingwood) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Fareham) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Folkestone) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Fort Kinnaird) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Friern Barnet) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Gloucester) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Harlow) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Hatfield) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Hemel Hempstead) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (High Wycombe) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Hove) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Huddersfield) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Huntingdon) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Ilford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Ipswich Martlesham) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Keighley) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Kidderminster) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Kirkcaldy) Limited Indirect United Kingdom Ordinary 50 100
Companion Care (Leicester Beaumont Leys) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Leicester Fosse Park) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Leighton Buzzard) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Linwood) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Lisburn) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Liverpool Penny Lane) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Livingston) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Maidstone) Limited Indirect United Kingdom Ordinary 50 100
Companion Care (Merry Hill) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Milton Keynes) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (New Malden) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Newbury) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Newcastle Kingston Park) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Northampton Nene Valley) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Norwich Hall Road) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Norwich Longwater) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Norwich) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Oldbury) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Oldham) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Orpington) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Oxford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Perth) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Peterborough Bretton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Peterborough) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Plymouth) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Poole) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Portsmouth) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Preston Capitol) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Pudsey) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Reading) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Redditch) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Redhill) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Romford) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Rotherham) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Rustington) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Scarborough) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Slough) Limited Indirect United Kingdom Ordinary 50 100
Companion Care (Southampton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Southend-On-Sea) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Stevenage) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Stirling) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Stockport) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Stoke Festival Park) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Swansea) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Swindon) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Tamworth) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Taunton) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Truro) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Tunbridge Wells) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Wakefield) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Weston-Super-Mare) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Winchester) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Winnersh) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Woking) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Woolwell) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Worcester) Limited Indirect United Kingdom Ordinary 50 50
Companion Care (Wrexham Holt Road) Limited Indirect United Kingdom Ordinary 50 50
Craigleith Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Crescent Link Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Crewe Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cross Hands Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Cumbernauld Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Dagenham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Darlington Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Daventry Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Denton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Dewsbury Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Doncaster Vets4Pets Limited Indirect United Kingdom Ordinary 50 100
Dorchester Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Dog Stay Limited Indirect United Kingdom Ordinary 12 12
Dover Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Droitwich Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Drumchapel Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Dudley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Dumbarton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Dunfermline Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Durham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
East Kilbride Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Eastleigh Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Eastwood Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Eccleshill Vets4Pets (Newco) Limited Indirect United Kingdom Ordinary 50 50
Epsom Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Falkirk Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Feltham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Filton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Gateshead Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Glasgow Forge Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Glasgow Pollokshaws Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Goldenhill Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Good Dog Food Limited Indirect United Kingdom Ordinary 9 0
Gosport Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Gravesend Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Greasby Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Greenford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Grimsby Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Guernsey Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Halesowen Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Halifax Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Handforth Vets4Pets Limited Indirect United Kingdom Ordinary 50 100
Hamilton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Harrogate New Park Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Harrogate Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hartlepool Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hastings Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Havant Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Haverhill Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hayling Island Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Heanor Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hedge End Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hemel Hempstead Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hendon Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hereford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hertford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
High Wycombe Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hinckley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hucknall Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hull Anlaby Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hull Stoneferry Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Hull Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Ilkeston Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Ipswich Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Irvine Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Kettering Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Kidderminster Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Kilmarnock Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Kirkby in Ashfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Lancaster Vets4Pets Limited Indirect United Kingdom Ordinary 50 100
Launceston Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Leamington Spa Myton Road Vets4Pets Limited Indirect United Kingdom Ordinary 50 100
Leeds Birstall Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Leeds Colton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Leeds Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Leigh-On-Sea Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Letchworth Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Leyland Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Lichfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Lincoln South Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Lisburn Longstone Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Llandudno Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Llanelli Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Llanrumney Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Longton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Loughborough Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Loughton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Luton Gipsy Lane Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Luton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Lytham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Maidenhead Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Maldon Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Mansfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Mapperley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Merthyr Tydfil Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Middlesbrough Cleveland Park Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Middlesbrough Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Middleton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Millhouses Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Morpeth Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
New Milton Vets4pets Limited Indirect United Kingdom Ordinary 50 50
Newcastle-Upon-Tyne Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Newmarket Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Newport Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Newton Abbot Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Newtownabbey Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
North Tyneside Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Northallerton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Northampton Riverside Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Northampton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Nottingham Chilwell Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Nottingham Netherfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Nuneaton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Oadby Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Old Kent Road Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Oxford Cowley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Paisley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Penrith Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Pentland Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Penzance Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Peterborough Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Pontypridd Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Poole Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Portishead Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Portsmouth Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Prenton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Preston Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Prestwich Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Project Blu Limited Indirect United Kingdom Ordinary 9 9
Pure Pet Food Ltd Indirect United Kingdom Ordinary 12 12
Quinton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Rayleigh Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Rhyl Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Richmond Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Rochdale Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Rotherham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Rugby Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Rugby Central Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Ruislip Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Rushden Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Saffron Walden Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Salford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Selly Oak Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sevenoaks Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sheffield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sheffield Drakehouse Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sheffield Wadsley Bridge Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Shelfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Shrewsbury Meole Brace Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Shrewsbury Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sidcup Vets4Pets Limited Indirect United Kingdom Ordinary 50 100
Sittingbourne Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Solihull Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Somercotes Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
South Shields Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Southampton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Southend Airport Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Southend-On-Sea Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Southport Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
St Albans Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
St Helens Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Stafford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Stechford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Stockton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Stourbridge Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Street Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sunderland South Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sunderland Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sutton Coldfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sutton In Ashfield Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Swindon Bridgemead Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Swinton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Sydenham Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Telford Madeley Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Thurrock Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Torquay Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Totton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Trafford Park Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Trowbridge Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Walkden Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Walsall Reedswood Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Waltham Abbey Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Walton on Thames Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Walton Vale Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Warminster Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Warrington Riverside Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Warrington Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Washington Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Waterlooville Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Watford Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
West Bromwich Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Weymouth Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Whitstable Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Widnes Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Wigan Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Wimbledon Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Wolverhampton Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Worksop Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Worthing Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
WSM Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Yate Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
Yeovil Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
York Clifton Moor Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
York Vets4Pets Limited Indirect United Kingdom Ordinary 50 50
During the 52 week period ended 28 March 2024, the Group has sold 100% of the
'A' shares in nine companies which were previously classified as subsidiaries,
and subsequent to sale of the 'A' shares, have been accounted for as Joint
Venture veterinary practices, which has led to the reduction in the holding in
nine entities listed above to 50% investment.
Glossary - Alternative Performance Measures
Guidelines on Alternative Performance Measures (APMs) issued by the European
Securities and Markets Authority came into effect for all communications
released on or after 3 July 2016 for issuers of securities on a regulated
market.
In the reporting of financial information, the Directors have adopted various
APMs of historical or future financial performance, position or cash flows
other than those defined or specified under International Financial Reporting
Standards (IFRS).
The Directors measure the performance of the Group based on the following
financial measures which are not recognised under UK-adopted international
accounting standards and consider these to be important measures in evaluating
the Group's strategic and financial performance. The Directors believe that
these APMs assist in providing additional useful information on the underlying
trends, performance and position of the Group.
APMs are also used to enhance the comparability of information between
reporting periods by adjusting for non-underlying items, to aid the user
in understanding the Group's performance. The number and appropriateness of
APMs presented in the financial statements has been reviewed and reduced from
the comparative period to those considered to be the most relevant for
measuring the performance of the Group.
Consequently, APMs are used by the Directors and management for performance
analysis, planning, reporting and incentive setting purposes.
All APMs relate to the current period results and comparative period where
provided.
APMs considered by the business to be a key performance indicator are
explained in more detail on page 8 of the Annual Report.
The key APMs used by the Group are:
'Like-for-Like' sales growth comprises total revenue in a financial period
compared to revenue achieved in a prior period for stores, online operations,
grooming salons and veterinary practices that have been trading for 52 weeks
or more, excluding fee income from Joint Venture veterinary practices where
the Group has bought out the Joint Venture Partners or will offer to buy out
the Joint Venture Partners in the future.
Underlying PBT: Underlying profit before tax (PBT) is based on pre-tax profit
before the impact of non-underlying items, being certain costs or incomes that
derive from events or transactions that fall outside the normal activities of
the Group and are excluded by virtue of their size and nature in order to
reflect management's view of the performance of the Group.
Free cash flow: Net increase/(decrease) in cash before the impacts of
dividends paid, share buybacks, investments, proceeds from new loans and
repayment of borrowings.
References to Underlying GAAP measures and Underlying APMs throughout the
financial statements are measured before the effect of non-underlying items.
APM Definition Reconciliation
Consumer revenue Consumer revenue being statutory Group revenue, less Joint Venture veterinary Consumer revenue (£m) FY24 FY23 Note
practice fee income (which forms part of statutory revenue within the Vet Statutory Group revenue 1,476.6 1,404.2 CIS
Group), plus gross consumer sales made by Joint Venture veterinary practices Joint Venture fee income (89.3) (77.2) 2
(unaudited). Revenue by Group managed practices (44.6) (37.5) 2
Revenue by all veterinary practices 563.6 492.9
Consumer revenue(1) 1,906.3 1,782.4
CIS = Consolidated income statement
(1)Consumer revenue cannot be directly referenced in the financial statements
as revenue by all veterinary practices relates to all Joint Venture customer
revenue.
Like-for-like revenue Like-for-like revenue growth comprises total revenue in a financial period Not applicable.
compared to revenue achieved in a prior period for stores, online operations,
grooming salons and veterinary practices that have been trading more than 52
weeks prior to the reporting date, excluding fee income from Joint Venture
practices where the Group has bought out the Joint Venture Partners or will
offer to buy out the Joint Venture Partners in the future.
Underlying profit before tax Underlying profit before tax (PBT) is based on pre-tax profit before the Underlying PBT (£m) FY24 FY23 Note
impact of certain costs or incomes that derive from events or transactions Underlying PBT 132.0 136.4 CIS
that fall outside the normal activities of the Group and are excluded by Non-underlying items (26.3) (13.9) CIS
virtue of their size and nature in order to reflect management's view of the Profit before tax 105.7 122.5
performance of the Group.
CIS = Consolidated income statement
Underlying basic EPS Underlying basic earnings per share (EPS) is based on earnings per share Underlying basic EPS (p) FY24 FY23 Note
before the impact of certain costs or incomes that derive from events Underlying basic EPS 20.7 22.8 5
or transactions that fall outside the normal activities of the Group and are Non-underlying items (4.1) (2.3)
excluded by virtue of their size and nature in order to reflect management's Basic earnings per share 16.6 20.5 5
view of the performance of the Group.
Free Net increase/(decrease) in cash before the impacts of dividends paid, share Free cash flow (£m) FY24 FY23 Note
buybacks, investment movements, acquisition and disposals of subsidiaries, Net (decrease)/increase in cash (120.9) 12.0 CFS
cash flow proceeds from new loans and repayment of borrowings. Remove effects of:
Dividends 60.7 58.7 CFS
Proceeds from new loan - (123.3) CFS
Repayment of borrowings 75.0 100.0 CFS
Share buyback 50.3 50.3 CFS
Investment movements 1.4 - CFS
Acquisition of subsidiaries 1.0 0.5 CFS
Disposal of subsidiaries 1.5 - CFS
Free cash flow 69.0 98.2
CFS = Consolidated statement of cash flows
Underlying CROIC Cash return on invested capital, represents cash returns divided by the Underlying CROIC FY24 FY23 Note
average of gross capital invested (GCI) for the last 12 months. Cash returns Cash returns:
represent underlying operating profit before share-based payments subject to Underlying operating profit 145.5 149.7 CIS
tax, then adjusted for depreciation of PPE, right-of-use assets and Share-based payment charges 5.9 4.9 3
amortisation. GCI represents gross PPE, right-of-use assets and software, and 151.4 154.6
other intangibles excluding the goodwill created on the acquisition of the Effective tax rate 25% 19%
Group by KKR (£906,445,000) plus net working capital, before the effect of Tax charge on above (37.9) (29.4)
non-underlying items in the period. 113.5 125.2
Underlying depreciation and amortisation 101.7 102.3 2
Cash returns 215.2 227.5
Net working capital movement is a measure of the cash required by the Gross capital invested (GCI):
business to fund its inventory, receivables and payables. Payables includes Gross property, plant and equipment 444.7 405.3 11
trade and other payables, income tax payable and other financial liabilities. Gross right-of-use assets 662.7 635.1 12
Intangibles 1,046.4 1,046.3 13
Less KKR goodwill (906.4) (906.4)
Investments 9.9 9.1
Net working capital: (106.7) (121.6) see definition
Receivables 60.9 51.8
Inventory 97.5 108.6
Payables (252.4) (265.2)
Provisions (12.7) (16.8)
GCI (at period end) 1,150.6 1,067.8
Average 1,109.2 1,002.7
Underlying CROIC 19.4% 22.7%
Net cash Cash and cash equivalents less loans and borrowings. Net cash (£m) FY24 FY23 Note
Cash and cash equivalents 57.1 178.0 18
Loans and borrowings (48.3) (123.3) 19
Net cash 8.8 54.7
Total indebtedness Net cash (above) less loans and borrowings plus lease liabilities. Total indebtedness (£m) FY24 FY23 Note
Net cash (above) 8.8 54.7
Lease liabilities (380.8) (421.4) 12
Total indebtedness (372.0) (366.7)
Like-for-like revenue
Like-for-like revenue growth comprises total revenue in a financial period
compared to revenue achieved in a prior period for stores, online operations,
grooming salons and veterinary practices that have been trading more than 52
weeks prior to the reporting date, excluding fee income from Joint Venture
practices where the Group has bought out the Joint Venture Partners or will
offer to buy out the Joint Venture Partners in the future.
Not applicable.
Underlying profit before tax
Underlying profit before tax (PBT) is based on pre-tax profit before the
impact of certain costs or incomes that derive from events or transactions
that fall outside the normal activities of the Group and are excluded by
virtue of their size and nature in order to reflect management's view of the
performance of the Group.
Underlying PBT (£m) FY24 FY23 Note
Underlying PBT 132.0 136.4 CIS
Non-underlying items (26.3) (13.9) CIS
Profit before tax 105.7 122.5
CIS = Consolidated income statement
Underlying basic EPS
Underlying basic earnings per share (EPS) is based on earnings per share
before the impact of certain costs or incomes that derive from events
or transactions that fall outside the normal activities of the Group and are
excluded by virtue of their size and nature in order to reflect management's
view of the performance of the Group.
Underlying basic EPS (p) FY24 FY23 Note
Underlying basic EPS 20.7 22.8 5
Non-underlying items (4.1) (2.3)
Basic earnings per share 16.6 20.5 5
Free
cash flow
Net increase/(decrease) in cash before the impacts of dividends paid, share
buybacks, investment movements, acquisition and disposals of subsidiaries,
proceeds from new loans and repayment of borrowings.
Free cash flow (£m) FY24 FY23 Note
Net (decrease)/increase in cash (120.9) 12.0 CFS
Remove effects of:
Dividends 60.7 58.7 CFS
Proceeds from new loan - (123.3) CFS
Repayment of borrowings 75.0 100.0 CFS
Share buyback 50.3 50.3 CFS
Investment movements 1.4 - CFS
Acquisition of subsidiaries 1.0 0.5 CFS
Disposal of subsidiaries 1.5 - CFS
Free cash flow 69.0 98.2
CFS = Consolidated statement of cash flows
Underlying CROIC
Cash return on invested capital, represents cash returns divided by the
average of gross capital invested (GCI) for the last 12 months. Cash returns
represent underlying operating profit before share-based payments subject to
tax, then adjusted for depreciation of PPE, right-of-use assets and
amortisation. GCI represents gross PPE, right-of-use assets and software, and
other intangibles excluding the goodwill created on the acquisition of the
Group by KKR (£906,445,000) plus net working capital, before the effect of
non-underlying items in the period.
Net working capital movement is a measure of the cash required by the
business to fund its inventory, receivables and payables. Payables includes
trade and other payables, income tax payable and other financial liabilities.
Underlying CROIC FY24 FY23 Note
Cash returns:
Underlying operating profit 145.5 149.7 CIS
Share-based payment charges 5.9 4.9 3
151.4 154.6
Effective tax rate 25% 19%
Tax charge on above (37.9) (29.4)
113.5 125.2
Underlying depreciation and amortisation 101.7 102.3 2
Cash returns 215.2 227.5
Gross capital invested (GCI):
Gross property, plant and equipment 444.7 405.3 11
Gross right-of-use assets 662.7 635.1 12
Intangibles 1,046.4 1,046.3 13
Less KKR goodwill (906.4) (906.4)
Investments 9.9 9.1
Net working capital: (106.7) (121.6) see definition
Receivables 60.9 51.8
Inventory 97.5 108.6
Payables (252.4) (265.2)
Provisions (12.7) (16.8)
GCI (at period end) 1,150.6 1,067.8
Average 1,109.2 1,002.7
Underlying CROIC 19.4% 22.7%
Net cash
Cash and cash equivalents less loans and borrowings.
Net cash (£m) FY24 FY23 Note
Cash and cash equivalents 57.1 178.0 18
Loans and borrowings (48.3) (123.3) 19
Net cash 8.8 54.7
Total indebtedness
Net cash (above) less loans and borrowings plus lease liabilities.
Total indebtedness (£m) FY24 FY23 Note
Net cash (above) 8.8 54.7
Lease liabilities (380.8) (421.4) 12
Total indebtedness (372.0) (366.7)
APM Definition Reconciliation
Pre IFRS 16 leverage Net cash (above) divided by underlying EBITDA less expected rental charges pre Pre IFRS 16 leverage FY24 FY23 Note
IFRS 16. Net cash (above) 8.8 54.7
Statutory operating profit 136.8
119.3
Underlying depreciation of property, plant and equipment 25.7 3
26.5
Underlying depreciation of right-of-use assets 66.8 3
65.1
Amortisation of intangible assets 10.1 9.8 3
Non-underlying depreciation of property, plant and equipment 0.4 3
4.2
Non-underlying depreciation of right-of-use assets 0.7 3
3.7
Other non-underlying items in EBITDA 18.3 11.8 3
Underlying EBITDA 247.2 252.0
Less:
Proforma rental charges pre IFRS 16 (78.6) (79.9)
Underlying EBITDA (pre IFRS 16)(1) 168.6 172.1
Pre IFRS 16 leverage (0.1)x (0.3)x
(1)Proforma rental charges pre IFRS 16 cannot be directly referenced in the
financial statements as the balance represents 52 weeks (FY23: 52 weeks) of
rental charges for each lease held at the balance sheet date.
Lease adjusted leverage Total indebtedness divided by underlying EBITDA. Underlying EBITDA has been Lease adjusted leverage FY24 FY23 Note
presented on a rolling 52 week proforma basis. Total indebtedness (above) 372.0 366.7
Underlying EBITDA 247.2 252.0
Lease adjusted leverage 1.5 x 1.5x
Lease adjusted leverage
Total indebtedness divided by underlying EBITDA. Underlying EBITDA has been
presented on a rolling 52 week proforma basis.
Lease adjusted leverage FY24 FY23 Note
Total indebtedness (above) 372.0 366.7
Underlying EBITDA 247.2 252.0
Lease adjusted leverage 1.5 x 1.5x
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