Another FTSE record but Pets at Home proves a dog
DIVING profits caused Pets At Home investors to turn tail.
The troubled retailer was bitten by rising staff costs and its decision to slash prices, reporting a 16.6pc slide in profit to £79.6m for the year ending March 29.
On a positive note, revenue was up 7.8pc at £898.9m and it decided to keep its dividend at 7.5p.
But a dearth of qualified vets in the UK means it has been forced to scale back the roll-out of lucrative new veterinary practices from 40 this year to between 20 and 25.
Pets At Home is in the middle of a three-year turnaround plan to make it more competitive as it battles tough online rivals.
This includes using its vast pet data to target products to customers, as well as offering them advice about looking after their furry friends.
New chief executive Peter Pritchard insists the turnaround is working, despite the results, saying: ‘More customers are coming back to shop with us and we are committed to returning the business to profit growth.’ George Salmon, an analyst at Hargreaves Lansdown, believes Pritchard has his hands full as he tries to revive the ailing retailer.
‘Pets has bumped up against the side of the tank a bit earlier than it expected and is only adding the odd new superstore here and there,’ Salmon said. Shares slumped 13pc, or 20.6p, to 137.4p.
The FTSE 100 inched its way to another record high, rising 0.23pc, or 18.28 points, to 7877.45.
Analysts say it could reach 8,000 by the end of the week. The FTSE
250 also hit a new high, up 0.25pc or 53.78 points, to 21,191.44.
Sticking with Britain’s mid-cap index, butcher Cranswick’s revenue surged 17.6pc to nearly £1.5bn in the year ending March 31, a sign its hefty investment plans are beginning to bear fruit.
Pre-tax profit shot up 13.5pc to £88m while its shares hopped 2.3pc, or 72p, to 3236p.
Investors wolfed down shares in Greencore, the world’s largest sandwich maker, despite it reporting an £18.1m pre-tax loss in the six months to March 30. The loss was mainly down to its once-failing US arm, although Greencore attempted to stop the rot in a restructure earlier this year. Shares rose 5.1pc, or 7.95p, to 164.6p.
Provident Financial shares marched higher after Barclays analysts said the doorstep lender was ‘on the road to recovery’.
The FTSE 250 credit provider has had a disastrous 12 months, having to deal with a botched IT upgrade and probes by the City watchdog into its credit card and car finance arms. But Barclays believes its shares, which rose 3.7pc, or 24p, to 679.2p, look cheap compared to its earnings.
On AIM, shares in Scottish renewable energy firm Atlantis
Resources took off after it raised £20m to fund a deal to buy and convert the Uskmouth power plant in South Wales, pay down debts and to boost its working capital. Shares flew 19.2pc, or 6.75p, higher to 42p at closing.
Avacta Group shares rocketed 20.3pc, or 6p, to 35.5p, after its antibody alternative treatment yielded positive results in a study, showing it can be used to fight diseases such as cancer.
Scapa Group shot up 10.1pc, or 44.2p, to 482.6p, after the bonding product maker reported an 18.2pc increase in profit for the year ending March 31 and increased its dividend from 2p to 2.4p.
An 11pc year- on-year increase in revenues in the first quarter pushed up shares in Clear Star, which provides background check software, up 7.5pc, or 3.5p, to 50.5p. It has a number of major clients, including Hilmar Cheese Company, one of the world’s largest cheese makers, and business jet maker Gulfstream Aerospace Corporation.