Profit warning and CEO departure send Pets at Home shares tumbling

(Sharecast News) - Pets at Home tanked on Thursday as it announced the immediate departure of chief executive Lyssa McGowan and downgraded its full-year profit guidance. The search for a permanent CEO has begun, but until then, non-executive chair Ian Burke has assumed the role of executive chair.

In an unscheduled trading update, Pets said its existing guidance assumed a central scenario for the retail division of 1% market growth against which it expected to return to market outperformance through FY26 as the investments it made in digital bore fruit.

However, it said the underlying pet retail market has remained subdued through the second quarter, declining slightly year to date.

"Against this, we have seen the performance of the retail business improve sequentially, narrowing the gap to the market, but the rate of improvement has been below expectations," the company said.

Pets said it continues to see double-digit digital sales growth, outperforming the online retail market, but store sales have proved "more challenging", falling 5% year to date.

The Vet Group business continues to deliver high-single digit sales growth and Pets said it's on track to deliver its planned 10 new practices in FY26, alongside 15 vet extensions and another year of profit progress.

"In light of the performance gap we have seen in retail versus our plan, we now expect FY26 underlying profit before tax in the range £90-100m," it said. This is down from guidance in July of £110m to £120m.

At 0920 BST, the shares were down 19.8% at 183.30p.