Veterinary firm CVS Group PLC on Thursday said it is confident of annual results in line with market expectations, but it reported a fall in half-year profit.
In the six months to December 31, pretax profit was down 4.4% from the year prior to £15.2 million from £15.9 million. Revenue, however, was up 5.8% year-on-year at £356.9 million from £337.3 million.
Keeping a lid on profit, administrative expenses grew 14% to £135.5 million from £118.8 million.
The Norfolk, England-based firm said it achieved a 2.7% growth in like-for-like sales growth in 12 months despite ‘softer market conditions in the UK with mixed practice performance’.
It reported 3.9% growth in adjusted earnings before interest, tax, depreciation, and amortisation to £67.7 million from £65.1 million a year prior.
CVS expects a full year outcome in line with expectations, which it puts at £141.9 million for adjusted Ebitda. It would represent growth from £134.6 million from financial 2025.
CVS Group shares were down 5.1% to 1,300.00 pence each on Thursday at midday in London.
The company said that low consumer confidence in the UK was affecting footfall in companion animal practices, but projected optimism on its Australia expansion.
It also noted a Competition & Markets Authority process in the UK is ‘drawing to an end’.
The CMA published its provisional decision in October following its veterinary market investigation. The watchdog said current regulation in the pet care market is ‘not fit for purpose’, and proposed prescription price caps.
Proposals by the CMA include ‘better information on prices, treatments, medicines and ownership, a price cap on written prescriptions and a new comprehensive price comparison website.’
In January, CVS welcomed government proposals for the pet care sector, which it believes will boost confidence in the industry. It noted the recommendation by the UK Department for Environment, Food & Rural Affairs to reform the veterinary surgeons act. CVS operates around 470 veterinary practices in the UK and Australia.
The UK government department said providers should offer ‘clearer prices’ for treatments, to boost transparency. Vet care providers also would be required to ‘disclose who owns them so pet owners know if their local practice is part of a larger chain or independent’.
Defra also proposed an ‘easier and more effective route for customers to raise concerns’.
CVS in January began trading on the Main Market, after moving from AIM.
On Tuesday, index operator FTSE Russell said CVS is set to join the FTSE 250 in the next index review.
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