2341004    17 july 2014 532 pm    proof 9
pets at home group plc 
annual report and accounts for the year ended 27th march 2014
london stock exchange pets
engaging customers 
engaging colleagues 
delivering growth 2341004    17 july 2014 532 pm    proof 9
pets at home is the uk’ s leading national specialist retailer of pets pet 
food petrelated products and pet accessories as well as operating the 
uk’ s largest small animal services business through our vets4pets and 
companion care veterinary practices and groom room grooming salons
since our first store opened in 1991 we have striven to be the ultimate pet shop 
experience for pet lovers and their pets through our extensive and innovative  
ranges and our highly trained and engaged colleagues who are available to share  
their expertise 
see further information online at 
investorspetsathomecom
more information is available online at 
investorspetsathomecom
welcome to our 
first annual report
investor proposition
a special business with a great future
 clear leader in the highly attractive £54 billion pet market
1
 unique ‘one stop shop’ proposition with a nationwide retail 
footprint incorporating pet services and complemented by 
an extensive online offer 
 high levels of engagement with customers and colleagues 
are a key driver of success
 clear growth opportunity driven by multiple levers
 strong financial performance and highly cash generative
 experienced and passionate management team
1 source occ data uk pet care market size in 2012 2341004    17 july 2014 532 pm    proof 9
in this 
report   
2014 financial headlines
revenues
£6654m

112
likeforlike growth
2
24
underlying ebitda
3
£1107m 166
 
margin
underlying unlevered fcf conversion
4
835
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance 12
market review 14
strategy and operations
chief executive officer’s review 18
strategy in action 24
corporate responsibility
corporate social responsibility 30
performance and financials
chief financial officer’s review 42
risks and uncertainties 48
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee 76
remuneration report 82
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of comprehensive income 108
consolidated balance sheet 109
consolidated statement of changes in equity 110
consolidated statement of cash flows 112
company balance sheet 113
company statement of changes in equity 114
company statement of cash flows 115
notes forming part of the financial statements 116
advisers and contacts ibc
2 ‘likeforlike’ growth comprises total sales revenue in a financial period compared to revenue achieved in a prior period for stores grooming salons 
and vets that have been trading for 52 weeks also includes revenue from the group’s online store 
3 underlying ebitda is calculated as group underlying operating profit under ifrs which includes amortisation of landlord and developer contributions 
received plus depreciation and amortisation and profits and losses on disposal where these are included in operating profit excludes exceptional 
items related party fees costs commensurate with operating the business as a publicly quoted company and ifrs 2 related share based payment 
credits and charges
4 underlying unlevered free cash flow is defined as underlying ebitda adjusted for changes in working capital acquisitions of property plant and 
equipment and other intangible assets investments in other financial assets and proceeds from the sale of property plant and equipment and is 
stated before cash flows for exceptional costs and acquisitions of subsidiaries financial year 2014 fcf has been adjusted through the removal of a 
£252m increase in other payables reflecting payables associated with ipo costs outstanding at year end
01
2014 operational headlines
 32 new stores opened during the year bringing the total  
portfolio to 377
 now the largest small animal veterinary services provider in  
the uk with 277 practices
 vip club reached 2 million members adding 15 million 
members during the year
 pets at home website relaunched in january 2014 now 
featuring a wider range of products fewer clicks to checkout 
and enhanced presentation of our pet services
investorspetsathomecom
london stock exchange pets 2341004    17 july 2014 532 pm    proof 9
02 2341004    17 july 2014 532 pm    proof 9
 strategic report
overview
the strategic report details our performance and how it 
has been achieved giving a comprehensive picture of 
the business and our future
pictured our colleagues’ shared passion for pets drives 
high levels of service loyalty and sales
engagement
central to our success
engaged customers and colleagues are central to our success 
creating loyalty and likeforlike sales growth through our highly 
trained and engaged colleagues we seek to increase our share of 
spend with current customers
see additional information online at
investorspetsathomecomourcompanyourservices
03 2341004    17 july 2014 532 pm    proof 9
pictured pets at home has established local 
relationships with schools colleges and hobby groups 
including scouts cubs and beaver groups
investor 
proposition
pets at home group plc
annual report and accounts for the year ended 27th march 2014
04
strategic report
overview 2341004    17 july 2014 532 pm    proof 9
standout leader in the highly attractive 
uk pet care market
 clear market leader with 377 stores larger than our five closest 
competitors combined
 the uk’s largest pet services provider – number one in both veterinary 
surgeries and grooming services 
 operating in a resilient market worth an estimated £54 billion
1
unique ‘one stop shop’ proposition 
with nationwide retail footprint pet services and omnichannel
 differentiated product range including private label and  
exclusive brands 
 pet services including vet practices groom rooms microchipping 
and nutrition consultations drive footfall to stores and crossselling 
opportunities
 high degree of engagement with our customers and colleagues – the 
shared passion for pets drives high levels of service loyalty and sales 
 unique customer loyalty programme vip club growing fast and offers 
opportunities for further customer engagement and market  
share gains
 sector leading pet specialist website to capture the growing omni
channel opportunity
clear growth story with multiple levers
 improve likeforlike growth through product innovation vip club 
engagement and offers omnichannel expansion and growing pet 
services 
 space rollout a target portfolio of 500 stores 700 veterinary 
surgeries and 300 groom rooms
 significant retrofit opportunity plans to refit stores with c30  
vet practices and c35 groom rooms per year
 focus on margin improvement underpinned by continued innovation 
and mix improvement of high margin own brand and private label 
products 
strong financial performance and 
highly cash generative
 consistent track record of likeforlike and ebitda growth over the past 
six years
 strong historical cash returns on invested capital and high unlevered 
free cash flow conversion 
 targeting a dividend payment in the financial year 2015
1  source occ data uk pet care market size in 2012
 
pet people 
love of pets 
colleague
engagement
customer 
engagement 
 
standout leader in the highly attractive
uk pet care market
unique ‘one stop shop’ proposition
with nationwide retail footprint
pet services and omnichannel
clear growth story with multiple levers
strong ﬁnancial performance and
highly cash generative
investorspetsathomecom
london stock exchange pets
05
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance  12
market review 14 2341004    17 july 2014 532 pm    proof 9
business 
model
clear market leader
pets at home is the uk’s leading national 
specialist retailer of pets pet food pet
related products and pet accessories as well 
as operating the uk’s largest small animal 
services business through our vets4pets 
and companion care veterinary practices 
and groom room grooming salons pets at 
home also owns and operates rideaway an 
equestrian products multichannel retailer 
our retail footprint is larger than the closest 
five competitors combined and we are the only 
provider in the uk market offering a full suite of 
both pet products and services
unique ‘one stop shop’
pets at home offers a unique omnichannel 
proposition for uk pet owners including a large 
retail store footprint multiple websites across 
our different brands innovative and exclusive 
products and pet services through our vet 
practices and grooming salons our primary 
retail website petsathomecom captures the 
highest levels of traffic in the uk online pet 
retail market and drives brand engagement and 
further customers to stores
differentiated products 
through our uk network of 377 stores pets 
at home provides a differentiated product 
offering for pet owners on our website over 
50 of products are unique to pets at home 
we know that our customers value a wide and 
varied range of high quality products which we 
can provide through our exclusive brands own 
label and private label products our innovation 
team provides design and creative input to a 
large number of the products we introduce each 
year with a strong focus on the development of 
our own brand and private label ranges which 
accounted for 42 of total revenues in the year
uk’ s leading pet services provider 
veterinary care and grooming services are 
another way in which pets at home stores 
offer more than typical pet shops the majority 
of the veterinary practices are operated as 
joint ventures with our vet partners under two 
brands companion care and vets4pets which 
form the uk’s largest branded small animal 
veterinary surgery group the 277 veterinary 
practices are located within stores as well 
as in standalone locations throughout the 
uk giving customers access to services in 
locations where the nearest store may not be 
convenient
groom rooms provide a wide range of services 
including full grooming bath and blow dry 
microchipping puppy grooming and nail 
clipping there are currently 129 groom  
room salons throughout the uk
in addition to veterinary care and grooming 
our instore colleagues deliver a wide range of 
services to customers and their pets these 
services include microchipping nutrition 
consultations weight checking and advice on 
licensed medicines from suitably qualified 
persons specially trained colleagues able to 
advise on such products 
highly engaged customers and colleagues
engagement is a key driver of our success and 
both our customers’ and colleagues’ passion 
for pets drives high levels of service sales and 
loyalty the pets at home loyalty card scheme 
vip club was voted ‘loyalty scheme of 2013’ 
by the direct marketing association and gives 
us a unique channel through which to engage 
and interact with its 2 million members and 
their pets 
community engagement
pets at home values engagement with the 
local community and has established local 
relationships with schools colleges and hobby 
groups including scouts cubs and beaver 
groups in conjunction with the charity support 
adoption for pets which pets at home helped 
to establish we support national animal  
rehoming charities such as the royal society 
for the prevention of cruelty to animals the 
dogs trust and battersea dogs and cats home 
on behalf of the charity at the end of 2014 
pets at home had adoption centres in 325 
stores which had facilitated the adoption of 
over 60000 pets during the year making the 
charity the number one pet rehoming charity 
in the uk 
strategic report
overview
pets at home group plc
annual report and accounts for the year ended 27th march 2014
06 2341004    17 july 2014 532 pm    proof 9
revenue streams
 
a strong product
and services
platform
 
 
 
 
 
highly engaged customers what is an engaged pet owner
to what extent do you agree with each of the
following statements
5 agship
50 small superstores
321 superstores
average store footprint
8500 sqft
1 new format barkers
377 stores
158 instore vets
instore services
127 instore groomers
117 standalone vets
standalone services
✓ pets at home
✓ vets4pets
✓ companion care vets
✓ the groom room
✓ rideaway
 food
 advanced nutrition
 treats
 health and hygiene 
accessories
 other accessories
 veterinary services
 grooming
 insurance
equestrian
wwwpetsathomecom
captures 47 of uk pet 
retail online trafc
1
websites
unique retail experience with instore ‘theatre’
provided by our pet villages aquaria and vivaria
 
pets at home own label products
exclusive products and brands regularly
refreshed
private label products such as wainwright’s 
fishmongers purely ruffer  tuffer
pet services in store – vet practices dog
grooming nutrition consultations microchipping
differentiated offering
passionate and expert colleagues
more than 5800 highly trained store colleagues
95 of store colleagues own pets
our colleague retention level is 81
colleague engagement of 93
 
 
 
engaged pet owners represent around twothirds 
of the pet market and are our key focus
2
our customers are more engaged and have
more pets than other owners
2
engaged customers have higher spend and 
focus on products they want
vip club has 2 million members representing 
over 7 million pets
based on a survey of 5000 pet owners conducted in july 2013
pets at home customers not pets at home customers
my pets are a very
big part of my life
i take my pets to the
vet regularly for checkups
i like to pamper my pets
and make them feel special
i always look for the cheapest
prices when buying pet food
nothing that i buy is
too good for my pets
my pets are 
my children
i tell my pets i love them 
at least twice a day
45
40
35
30
25
investment in 2014
new store rollout and refurbishment 
services rollout and retrots to stores
relaunched website petsathomecom
vip club development
additional group colleagues to support growth
successfully implementing sap
wwwrideawaycouk 
is our equestrian business
1 week commencing 16 may 2014 2 based on a survey of  5000 pet owners in july 2013 
2 standalone vet 
 groomers
investorspetsathomecom
london stock exchange pets
07
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance  12
market review 14 2341004    17 july 2014 532 pm    proof 9
2014 
highlights
a retail business that has 
consistently delivered
 revenues grew 112 to £6654m 
reflecting store portfolio expansion and 
strength across food accessories and 
services
 likeforlike sales growth of 24 driven 
by vip club success strength in advanced 
nutrition omnichannel and the growing 
maturity of groom rooms and vet practices
 likeforlike growth in revenues generated 
within the joint venture veterinary practices 
of 140 underpinning fee income growth
 underlying ebitda margin expansion of 
17bps to 166 reflecting the leverage from 
our services business which represents 
76 of group revenues financial year 
2013 53 
financial highlights
revenues  likeforlike growth
£6654m 
2013 £5983m
£6654 £5983 £5443 £5178
2014 2013 2012 2011
revenues £m lfl growth 
£m
0
100
200
300
400
500
600
700
00
10
15
20
25
30
35

1
underlying ebitda
2
£1107m 
2013 £985m
£1107 £985 £912 £924
2014 2013 2012 2011
underlying ebitda margin 
£m
0
20
40
60
80
100
120
0
50
100
150
200

1
gross margin
538 
2013 541
538 541 537 532
1
2014 2013 2012 2011

0
20
40
60
underlying unlevered free cash flow  
cash flow conversion
3
 
£924m 
2013 £968m
£924 £968 £786 £774
2014 2013 2012 2011
unlevered fcf £m conversion 
£m
0
20
40
60
80
100
0
20
30
10
70
60
50
40
80
90

1 4
financial year ended march
1 2011 represents a 53 week financial year 2012 2013 and 2014 represent 52 week financial years
2  underlying ebitda is calculated as group underlying operating profit under ifrs which includes amortisation of landlord and developer 
contributions received plus depreciation and amortisation and profits and losses on disposal where these are included in operating profit 
excludes exceptional items related party fees costs commensurate with operating the business as a publicly quoted company and ifrs 2 related 
share based payment credits and charges
3  unlevered free cash flow before interest and tax is defined as net cash from operating activities adjusted for changes in working capital 
acquisitions of property plant and equipment and other intangible assets investments in other financial assets proceeds from the sale of 
property plant and equipment and is stated before cash flows for exceptional costs and acquisitions of subsidiaries
4  financial year 2014 fcf has been adjusted through the removal of a £252m increase in other payables reflecting payables associated with ipo 
costs outstanding at year end 
strategic report
overview
pets at home group plc
annual report and accounts for the year ended 27th march 2014
08 2341004    17 july 2014 532 pm    proof 9
services acceleration vip success and the launch of new formats
 32 new stores opened during the year 
taking our total store portfolio to 377
 now the largest small animal veterinary 
services provider in the uk with 277 
practices reflective of 47 instore and 22 
standalone openings in the year
 successful integration of vets4pets 
acquired march 2013 with a single support 
office now established for the combined vet 
business
 largest number of groom rooms opened in 
a single year 42 new salons bringing the 
portfolio to 129 
 vip club reached 2 million members at the 
end of the financial year 2014 with 15 
million members added in the year
 pets at home website relaunched in 
january 2014 now featuring a wider range 
of products fewer clicks to checkout and 
enhanced presentation of our pet services
customer engagement
customer opinions of service 
through net promoter score
84
vip club members 
05m
2013
customer opinions of service 
through net promoter score
84
vip club members 
2m
2014
the net promoter score is gathered through fish4opinioncouk a customer service survey website operated by the group
space rollout
stores
377 
2013 345
2014 2013 2012 2011
377 345 313 281
instore vets
158 
2013 111
2014 2013 2012 2011
158 111 87 69
standalone vets
119 
2013 97
2014 2013 2012 2011
119 97 5 4
groomers
129 
2013 87
2014 2013 2012 2011
129 87 61 43
92 from vets4pets acquisition
operational highlights
colleague engagement colleague retention
92 91 93 93
2011 2012 2013 2014
80 83 83 81
2011 2012 2013 2014
source hr reports and results of ‘we’re all ears’ engagement surveys
investorspetsathomecom
london stock exchange pets
09
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance  12
market review 14 2341004    17 july 2014 532 pm    proof 9
pictured our success is driven by our highly engaged 
colleagues who deliver outstanding service to our pet 
customers
chairman’ s 
statement
10
strategic report
overview
pets at home group plc
annual report and accounts for the year ended 27th march 2014 2341004    17 july 2014 532 pm    proof 9
dear shareholder
2014 was an historic year for the business 
culminating in our listing on the premium 
segment of the london stock exchange 
at the same time we delivered record 
financial results successfully executed on 
our growth strategy continued to engage our 
colleagues and pet customers and enhanced 
our governance with an expanded board of 
directors
pets at home is the leader in the highly 
attractive uk pet care market we stand 
uniquely placed as the only uk retailer offering 
a full suite of pet products and services 
across both stores and the internet we offer 
customers a truly differentiated range which 
drives engagement and loyalty in a one stop 
shop environment
during the year we believe we have benefited 
both from positive market dynamics as well 
as the successful execution of our plans 
historically the uk pet care market has 
experienced growth levels above those of the 
overall nonfood sector driven by pet owners’ 
continued demand for innovative premium 
products the increased uptake of pet services 
and the desire for owners to treat and care for 
their pets as one of the family we believe this 
dynamic continues
in the financial year 2014 revenues grew by 
112 to £6654m we experienced another 
year of likeforlike growth at 24 driven by vip 
club success strength in advanced nutrition 
omnichannel and the increasing maturity of  
pet services
nick wood and our executive management 
team have continued to execute our growth 
strategy for the business we are very proud 
to have become the uk’s largest small animal 
veterinary services provider with 277 practices 
operating under the companion care and 
vets4pets brands at year end our groom room 
services expanded at a rapid rate with 42 
salons added to our store portfolio the largest 
expansion we have seen in a single year we 
also opened 32 stores bringing our portfolio 
to 377 larger than the five closest specialist 
competitors combined our success is driven 
by our highly engaged colleagues who deliver 
outstanding service to our pet customers 
this high level of colleague engagement was 
recognised by being awarded the sunday times 
best place to work for large companies  
in 2013
as a public company our vision remains the 
same to be the best pet shop in the world we 
have always sought to deliver superior returns 
to our shareholders through the continued 
growth profitability and cash flows of the 
company at listing we enhanced our corporate 
governance framework with an expansion of the 
board and the appointment of five independent 
nonexecutive directors paul coby tessa 
green amy stirling and paul moody and we 
welcomed dennis millard as deputy chairman 
and senior independent nonexecutive director 
each director has been chosen to bring a 
range of retail public company commercial and 
charitable skills to pets at home brian carroll 
has been appointed as a nonexecutive director 
of the board and representative of our principal 
shareholder
looking ahead our performance in 2014 has 
given us a solid platform to build upon we 
remain confident in the business and anticipate 
a further year of growth for pets at home
finally on behalf of myself and the board i 
would like to thank all our colleagues for their 
substantial contribution during this historic year 
their continued passion and enthusiasm for the 
business are integral to our success
we will continue to live our values in driving the 
company forward working together as a team 
and taking great pride in what we do
tony denunzio 
nonexecutive chairman
11th june 2014
did you know   
we added more than 2750 products to 
stores in the year refreshing over a third 
of our product range
see additional information online at
investorspetsathomecom
tony denunzio 
nonexecutive chairman
investorspetsathomecom
london stock exchange pets
11
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance  12
market review 14 2341004    17 july 2014 532 pm    proof 9
group at 
a glance
an extensive store and services portfolio with broad national coverage
new stores opened in 2014
stores format vet groomer
altrincham super ✕ ✓
barnsley cortonwood super ✓ ✓
blackpool warbreck super ✓ ✓
bletchley super ✓ ✓
bodmin small ✕ ✕
bridgwater super ✓ ✓
bromsgrove super ✕ ✓
burgess hill super ✓ ✓
consett small ✕ ✓
coventry walsgrave small ✓ ✓
doncaster thorne super ✕ ✓
dorchester super ✓ ✓
dunfermline super ✓ ✓
eltham small ✕ ✓
greenford small ✕ ✓
hatfield super ✓ ✓
hertford super ✓ ✓
keighley super ✓ ✓
lancaster super ✓ ✓
leicester beaumont leys small ✓ ✓
luton super ✓ ✓
maldon small ✕ ✓
merry hill super ✓ ✓
old kent road super ✓ ✓
penrith super ✓ ✓
peterborough bretton small ✓ ✓
sutton in ashfield super ✕ ✓
sydenham super ✓ ✓
tiverton small ✕ ✕
walsall reedswood super ✓ ✓
worksop small ✕ ✕
superstores
small stores
multiple brands through  
which to engage
pets at home offers the ultimate pet shop 
experience with a uk wide network of 377 
stores 42 of stores have a vet practice 
whilst 34 have a groom room
our veterinary brand operated with our joint 
venture vet partners acquired in march 2013 
now numbering 158 practices this will become 
our dominant vet brand going forward
our original veterinary brand operated with 
our joint venture vet partners in operation 
since 2001 and now numbering 119 practices 
companion care vets are migrating to the 
vets4pets brand over time
our dog  cat grooming service with 127 
locations in stores plus 2 groom rooms 
located in vets plus format practices where a 
groom room is located alongside a standalone 
veterinary practice
 
a specialist retailer of equestrian supplies with 
a superstore in york as well as a website and 
catalogue 
our new format dog focused high street store 
in wilmslow cheshire offering premium 
products and services targeted at highly 
engaged dog owners
strategic report
overview
pets at home group plc
annual report and accounts for the year ended 27th march 2014
12 2341004    17 july 2014 532 pm    proof 9
instore
44 
 vets4pets
114  
companion care
standalone
114  
vets4pets
5  
companion care
unique joint venture veterinary business
pets at home operates the only largescale joint venture veterinary services business in the uk market 
under our two veterinary brands – vets4pets and companion care the jv model allows each vet 
practice to operate as an independent business owned by pets at home and a veterinary jv partner 
and is funded by small loans into the business by the jv partner and pets at home alongside a larger 
independent bank loan the jv partner pays a service charge if operating from an instore practice 
reflecting the cost of the space occupied and a percentage of their revenue in the form of fee income 
to pets at home we provide all the administrative and back office support allowing the vet partner and 
their colleagues to focus on clinical excellence and delivering the best possible service to pets and their 
owners the jv partner also receives the benefit from the profit stream in the form of a dividend as well 
as potential capital accretion from growing the practice
companion care is our original instore veterinary brand whilst vets4pets acquired in march 2013 
added 92 standalone vet practices to the group the group successfully integrated the two businesses 
ahead of schedule during the course of fy14 which included the implementation of new joint venture 
contracts for new practices combining support office functions and the commencement of rebranding 
of practices to vets4pets we are working with our jv partners to migrate all practices to the vets4pets 
brand over time as well as a single veterinary practice management system across all jv surgeries
whilst pets at home operates its vets practices principally on a jv basis the group is committed to 
maintaining ten wholly owned group venture veterinary practices one of the functions of such group 
ventures is to allow potential jv partners to experience working as part of the group before committing 
fully to a jv practice another function of the group ventures is to allow us to trial new initiatives prior to 
launching them across the jv practices
stores
5 flagship
321 superstores
50 small superstores
1 new format barkers
instore services
158 instore vets
127 instore groomers
standalone services
117 standalone vets
2 standalone vet and groomers
store locations
377
 
 
 
 
 
 
 
service locations
277 vets 129 groomers
 
 
 
 
 
 
 flagship superstores standalone vets
small superstores instore vets and groomers
investorspetsathomecom
london stock exchange pets
13
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance  12
market review 14 2341004    17 july 2014 532 pm    proof 9
market 
review
the uk pet care market is large resilient and growing
 the uk pet care market is a large resilient market worth around £54 billion supported by a stable pet population 
 future growth will be driven by the continued humanisation of pets customers’ increased desire for premium and innovative 
products a shift to advanced nutrition food and the increasing use of pet services
 in the online channel penetration of pet products has been increasing at around 1 per annum future growth will be driven 
by click  collect where customers are able to order products online for collection in store
 the market has shown resilience to periods of economic challenge with no individual year of negative growth from 2006 to 
2012 outpacing the broader uk retail sector over the same period
market size
uk pet care market value £54bn 2012
accessories
health  hygiene £03bn
other accessories £04bn
services
insurance £07bn
grooming £02bn
vet services £16bn
food
treats £03bn
advanced nutrition £02bn
other food £17bn
source occ data all £ values excluding vat
historic growth
£bn
0
10
20
30
60
40
50
2012 2008
accessories £bn
health  hygiene 26
other accessories 03
services £bn 
insurance 80
grooming 33
vet services 14
food £bn
treats 95
advanced nutrition 77
other food 08
growth 20082012 cagr 
26
14
33
80
03
95
77
08
total market £4892bn total market  £5412bn
source occ data all £ values excluding vat
strategic report
overview
pets at home group plc
annual report and accounts for the year ended 27th march 2014
14 2341004    17 july 2014 532 pm    proof 9
pets at home is the leading pet care retailer and pet care services provider in the uk
 the pets at home store portfolio is larger than the five closest competitors combined
 we operate the largest branded small animal veterinary business in the uk market under a 
unique joint venture model
 pets at home is estimated to hold a 12 share of the overall uk pet care market  
including food nonfood and services
number 1 specialist pet care retailer
pets at 
home
kennel
gate
just for 
pets
pampurred
pets jollyes
pets 
corner
no of stores 377 20 22 47 56 82
number 1 vet group
pets at 
home cvs medivet
independent
vetcare vets now goddards
no of vets 277 256 101 88 52 49
data as at end of march 2014
petsathomecom has grown rapidly and captures 47 of traffic for uk pet retail
47 12 12 11 7 3 5 3
amazon uk – pet supplies
wwwzoopluscouk wwwpetsathomecouk
wwwpetplanetcouk
wwwpetsupermarketcouk
wwwseapetscouk
fetchcouk
other
share of uk pet market online traffic
source hitwise 16th may 2014
pictured our support allows our joint venture 
veterinary partners to focus on clinical 
excellence and delivering the best possible 
service to pets and their owners
investorspetsathomecom
london stock exchange pets
15
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance  12
market review 14 2341004    17 july 2014 532 pm    proof 9
16 2341004    17 july 2014 532 pm    proof 9
strategic report
strategy and 
operations
our strategy is to leverage our leading position in 
the uk pet care market exploiting existing growth 
opportunities whilst developing new opportunities for 
growth
pictured the current vet portfolio has 277 small animal 
veterinary practices
delivery
growth levers
the operational delivery of the strategy is achieved through  
three growth levers expanding likeforlike sales space rollout  
and footprint optimisation and continued focus on gross  
margin development 
see additional information online at
investorspetsathomecomourcompanyourservices
17 2341004    17 july 2014 532 pm    proof 9
pictured high colleague retention rates place pets at 
home as a leader within the retail industry
chief executive 
officer’ s review
pets at home group plc
annual report and accounts for the year ended 27th march 2014
18
strategic report
strategy and operations 2341004    17 july 2014 532 pm    proof 9
nick wood 
chief executive officer
strategic overview
during the financial year 2014 we continued to make strong progress on our strategy to leverage our  
leading position in the uk pet care market and develop new opportunities for growth
this strategy is reflected in the pets at home pawprint the internal 
articulation of our strategy to all colleagues across the business to 
be the best pet shop in the world by providing world class shops 
colleagues who are friendly experts being at the heart of every 
community always new and exciting offering the best vets and 
groomers being a truly amazing place to work and putting pets  
before profit 
the operational delivery of the strategy is achieved through three 
growth levers 
 expanding likeforlike sales
 space rollout and footprint development
 continued focus on gross margin improvement
we saw good progression against all three growth levers during the 
financial year 
strategy highlights
expand 
likeforlike 
sales
product and 
innovation
 more than 2750 skus launched during the year refreshing over onethird of our store product range
 new launches in advanced nutrition — wainwright’s cat and wainwright’s grain free dog food
vip club
 vip club reached 2 million members and captured over 50 of store revenues by march 2014 
 voted ‘best loyalty programme’ in retail by the loyalty awards 2014
omnichannel
 new website launched in january 2014
 web range expanded and now exceeds instore range
services
 retrofit services added to stores included 18 veterinary practices and 11 groom room salons
engagement
 colleague retention rate of 81
 customer advocacy net promoter score of 84
space rollout 
and footprint 
development
store  services 
rollout
 32 new stores opened 69 new veterinary practices 
47 instore 22 standalone 42 new groom room salons
 barkers launched in wilmslow cheshire — our trial high end dog focused high street store format 
focus on 
segmental  
gross margin 
improvement
product mix  
own brand
 advanced nutrition now 56 of total dog and cat food sales excluding treats fy13 53
 wainwright’s dog food sales grew by 267 to £272m 
fy13 £214m 
 ownprivate label products 42 of store revenues 
 pet services increasing maturity starting to positively impact margins but still at early stages 
investorspetsathomecom
london stock exchange pets
19
strategic report
strategy and operations
chief executive officer’s review 18
strategy in action 24 2341004    17 july 2014 532 pm    proof 9
chief executive officer’ s review
continued
likeforlike growth
product and innovation
differentiated and unique product is critical 
to the group’s strategy driving both customer 
loyalty and visit frequency we refreshed our 
product range with more than 2750 new skus 
stock keeping units in 2014 representing 
over a third of our total range during the year 
a number of new advanced nutrition an 
brands were introduced to stores including 
barking heads for dogs and meowing heads 
for cats an foods have superior health and 
nutritional benefits to pets and are the fastest 
growing segment of the pet food market new 
launches within wainwright’s our private label 
an range also saw strong sales after launch 
which included wainwright’s for cats as well as 
wainwright’s grain free for dogs 
vip club
our vip club continues to grow at a rapid rate 
reaching 2 million members and capturing 
over 50 of all revenues spent in stores by 
the end of march 2014 increasing use of 
the loyalty card is also being seen within our 
instore veterinary practices and groom room 
salons vip allows us to send personalised and 
targeted marketing to owners and their pets 
and will continue to be one of the key levers 
through which we can take further market 
share this year ahead of the wainwright’s cat 
food launch we were able to target cat owners 
within the vip club database particularly those 
who were already purchasing wainwright’s 
dog food these members were sent targeted 
emails resulting in 55 of wainwright’s cat 
food launch sales being attributable to vip 
club members our vip club also creates 
charity lifelines each time a card is swiped 
and generated over £1 million for customer 
nominated charities in fy14
omnichannel
petsathomecom was relaunched in january 
2014 the website now features only four clicks 
to checkout richer content and offers more 
than 8100 skus higher than instore ranges 
post new site launch as expected the website 
experienced slightly lower levels of traffic as 
reindexing within search engines occurred 
but more recent data shows that visits to the 
site have now recovered to prelaunch levels 
we have also seen less activity from some 
competitor websites meaning our overall share 
has increased slightly and we remain the highest 
traffic pet website in the uk with more than 
three times the traffic levels of our nearest 
competitors 
our food subscription service which enables 
customers to receive their fifth order for free 
remains in trial our click and collect cc 
service which allows customers to place an 
order on the website for collection in store 
within two hours continues to perform well 
cc sales as a precentage of total website 
sales have been maintained since the new 
website launch this is just one lever through 
which we seek to drive footfall to stores via the 
website and we continue to view our online 
strategy as far more than simply a platform for 
customer purchases but as a portal to drive 
engagement and crossselling activities 
looking ahead we plan to launch mobile and 
tablet friendly website versions and increase 
our online product range towards a target of 
10000 skus we will rollout deliver to store 
which enables customers to order any product 
available online for delivery into a local store 
we are also enabling the redemption of vip 
vouchers online this will create a seamless 
store and online shopping experience for vip 
customers as well as allowing us to track offer 
redemption rates and measure success and 
returns more easily 
“we refreshed our product 
range with more than 2750 
new skus in 2014”
2012
2013
2014
pictured refreshment of our summer brights 
dog bed range
pets at home group plc
annual report and accounts for the year ended 27th march 2014
20
strategic report
strategy and operations 2341004    17 july 2014 532 pm    proof 9
services
retrofitting of veterinary practices and groom 
room salons to existing stores drives like
forlike store sales by enhancing our overall 
proposition driving store footfall and enabling 
crossselling of products during the year 
18 veterinary practices and 11 groom room 
salons were added to existing stores
engagement
customer and colleague engagement is central 
to the group’s success creating loyalty and like
forlike sales growth through our highly trained 
and engaged colleagues we seek to increase 
our share of spend with current customers and 
extend the pets at home experience to new 
customers
colleague engagement levels which are 
measured through an internally collated survey 
were 93 in fy14 fy13 93 being able to 
maintain such a high level of engagement is 
reflective of our rewards system the specialist 
training offered and the opportunity for 
colleagues to change roles and diversify their 
skill sets within the business 
colleague retention rates decreased marginally 
in fy14 to 81 fy13 83 but such a rate 
still places pets at home as a leader within the 
retail industry 
pets at home measures customer advocacy 
through the net promoter score “nps” 
gathered through fish4opinioncouk a 
customer service survey website operated 
by the group with over 110000 customer 
feedback points over the year fy14 nps levels 
were maintained at 84 fy13 84 during 
the year we implemented some changes to 
the way in which nps is measured effectively 
raising the threshold at which we consider 
scores given by customers to represent a 
positive experience if we had maintained the 
same criteria as the previous year nps would 
have been 86 this is a key example of our 
values in action challenging our standards and 
getting better every day
our fundraising initiatives on behalf of our 
nominated charity support adoption for pets 
also grew strongly during the year support 
adoption for pets which is the largest animal 
rehoming charity in the uk raised £265m for 
national animal welfare charities and local re
homing organisations during the year and has 
raised over £10m since its inception in 2006 
space and footprint expansion
a key part of the group’s strategy is to increase 
the number of stores instore and standalone 
veterinary practices and groom room salons
during fy14 pets at home opened 32 new 
stores bringing the total store portfolio to 377 
across the uk the portfolio includes the new 
trial high street store format barkers ‘barkers 
of wilmslow’ opened in wilmslow cheshire 
in march 2014 featuring high end exclusive 
luxury dog products at the premium end of the 
market 
investorspetsathomecom
london stock exchange pets
21
strategic report
strategy and operations
chief executive officer’s review 16
strategy in action 24 2341004    17 july 2014 532 pm    proof 9
chief executive officer’ s review
continued
during the year we became the largest provider 
of small animal veterinary services to pet 
owners in the uk with a vet portfolio at year 
end of 277 practices of the 69 new veterinary 
practices opened 18 were retrofits to current 
stores 29 were new instore locations and 
22 were standalone practices pets at home 
operates the only large scale joint venture 
veterinary services model in the uk market 
under our two veterinary brands – companion 
care our original veterinary brand and 
vets4pets acquired in march 2013 the joint 
venture jv model allows each vet practice to 
operate as an independent business jointly 
owned by pets at home and a veterinary 
jv partner funded by small loans into the 
business by the jv partner and pets at home 
alongside a larger independent bank loan the 
ownership structure enables all profits and 
capital accretion within the jv to accrue to the 
vet partner this structure gives us the ability 
to work closely with the partner to develop their 
business and overcome any challenges which 
is key to the success of the business model 
the jv vet partner pays a service charge 
reflecting the cost of the space occupied in 
store and a percentage of their revenue in the 
form of fee income to pets at home whilst we 
provide all the administrative and back office 
support allowing the vet partner and their 
colleagues to focus on clinical excellence and 
delivering the best possible service to pets and 
their owners
the current vet portfolio has 119 companion 
care practices and 158 vets4pets practices 
of which 92 were acquired in 2013 going 
forward we are opening all new surgeries 
under the vets4pets brand and working with 
our current joint venture partners to move 
to vets4pets branding which will enable 
advertising synergies across the vet group 
leveraging national brand awareness with 
potential new customers
groom room rollout was particularly strong 
during the year with 42 new openings of which 
11 were retrofits and 31 within new stores 
the uk grooming services market is highly 
fragmented and the groom room is positioned 
as the only branded chain in the market ideally 
positioned to benefit from increased demand 
“during the year we became 
the largest provider of small 
animal veterinary services to 
pet owners in the uk”
revenues
£6654m 
2013 £5983m

112
underlying ebitda
£1107m 
2013 £985m

124
pets at home group plc
annual report and accounts for the year ended 27th march 2014
22
strategic report
strategy and operations 2341004    17 july 2014 532 pm    proof 9
going forward pets at home has a strong 
store and services rollout programme current 
analysis conducted in conjunction with caci 
shows the potential for over 500 stores 45 
instore vets over 250 standalone vets and 
over 300 grooming salons in the uk market
focus on gross margin
the group remains focused on innovation 
increasing brand choice for customers and 
developing its own brand and private label 
offerings in order to improve margins higher 
margin advanced nutrition an and private 
label products such as wainwright’s are an 
important contributor during the year we 
launched a number of new an brands to stores 
helping to drive an revenues to 56 of total 
dog and cat food revenues excluding food 
treats fy13 53 wainwright’s dog food also 
continued to gain popularity growing by 267 
to £272m fy13 £214m own brand and 
private label products represented 424 
of gross store revenues during the year  
fy13 421
as our vet practices and groom room salons 
continue to mature we have begun to see an 
increasing contribution to group profitability 
the jv vet practices take up to seven years 
to mature although they are profitable to the 
group from opening through the percentage 
of revenue payment and startup fees as the 
jvs mature and reach higher utilisation rates 
there is an opportunity for our revenue stream 
to increase without a significant increase in 
our cost base delivering margin leverage 
within the groom room business new salons 
are dilutive in the first two years with maturity 
achieved after five years we remain excited 
about the further maturation and potential 
margin benefit the services opportunity 
presents
summary and outlook
pets at home has delivered excellent results 
in the past financial year increasing like
forlike sales improving underlying ebitda 
margin delivering on the rollout programme 
strengthening our pet services offer and 
increasing the profile of the brand
the pet care market outlook remains good 
whilst economic indicators for the uk are 
positive the lack of a sustained increase in 
consumer disposable incomes gives some 
caution to the outlook we remain comfortable 
with market expectations for the coming 
financial year
the group will continue to execute its strategy 
leveraging a number of growth opportunities 
improving likeforlike sales increasing space 
and optimising our footprint through the 
inclusion of pet services and maintaining a 
focus on gross margin we expect to open 
around 25 stores 60 veterinary practices and 
50 groom room salons in fy15
the board and executive management team 
remain confident in the future prospects of the 
group
nick wood 
chief executive officer
11th june 2014
“higher margin advanced 
nutrition and private label 
products such as wainwright’s 
are an important contributor to 
gross margin progression”
pictured launch of wainwright’s grain free for 
dogs in fy14
investorspetsathomecom
london stock exchange pets
23
strategic report
strategy and operations
chief executive officer’s review 18
strategy in action 24 2341004    17 july 2014 532 pm    proof 9
strategy 
in action
delivering across the pawprint supports our strategy of driving growth in likeforlike space across gross margin
growth lever execution future plans
grow likeforlike product and innovation
 continually refresh the product mix with new private label and own brand launches exclusive 
products which reflect the latest trends in order to drive customer loyalty and visit frequency
pricing
 deliver value for money pricing reflective of product range exclusivity convenience price 
service and quality 
vip club
 develop customer loyalty to the pets at home brand by promoting our service offer and 
targeted discounts whilst communicating information relevant to customers’ pets needs such 
as lifestage milestones based on our unique understanding of customers and their pets
marketing
 focus on customer acquisition and brand engagement by leveraging the emotional 
relationships owners have with their pets
omnichannel
 further develop the cohesiveness and quality of store and web based offerings to become the 
uk’s leading omnichannel pet retailer enable customers to shop instore or online reserve 
products and collect instore or order instore and have delivered to the home
services
 refurbish and retrofit existing space to accommodate new vet practices andor groom rooms 
which are vital to the overall customer proposition driving store footfall and increasing loyalty
grow space 
 optimise footprint
optimised store rollout
 open new stores in optimal locations and increase the number of instore and standalone 
veterinary practices and groom room grooming salons
grow gross margin product mix and own 
brands
 generate the right balance between high and low margin products by maintaining the 
penetration of own label and private brands with a focus on advanced nutrition wet food and 
life stages food our flagship food brand wainwright’s provides significant opportunities to 
enhance revenues and margins
sourcing
 build closer relationships with suppliers and improve contractual terms improve product quality 
and access innovative new products continue to leverage our sourcing office in hong kong 
pets at home asia to develop relationships with existing and new overseas suppliers
terms
 improve buying terms by driving economies through increased quantities providing financial 
support for tv and marketing campaigns negotiating on working capital terms
our strategy is to leverage our leading position in the uk pet care 
market exploiting existing growth opportunities whilst developing  
new opportunities for growth
our pawprint
the pawprint is the internal articulation of our strategy to all colleagues  
across the business
pets at home group plc
annual report and accounts for the year ended 27th march 2014
24
strategic report
strategy and operations 2341004    17 july 2014 532 pm    proof 9
did you know   
we retrofitted 18 veterinary practices and 
11 groom rooms to our stores during  
the year
see additional information online at
investorspetsathomecom
our current strategy leads to a target portfolio of more than 500 
stores 700 vets and 300 groomers
 detailed market analysis undertaken with caci using demand mapping and catchment area 
identification has allowed us to identify future store and vet locations 
 we intend to open around 25 new stores 60 veterinary practices and 50 groom room  
salons each year
129
119
158
192
100
131
117
54
123
500 450 250 300
377
stores
instore 
vet 
standalone 
vet 
groomers
existing potential retrots potential new
we have significant opportunity for expansion
source caci pets at home existing storepractice numbers as at 27th march 2014
investorspetsathomecom
london stock exchange pets
25
strategic report
strategy and operations
chief executive officer’s review 18
strategy in action 24 2341004    17 july 2014 532 pm    proof 9
engaged colleagues underpin our 
business model creating higher 
customer advocacy and driving 
increased spend
customers with higher levels of advocacy regarding 
knowledge and friendliness have larger basket sizes
colleague knowledge
£2101
less than satised highly satised
£2204
customer spend per visit £
5 
colleague friendliness
£2064
less than satised highly satised
£2200
customer spend per visit £
7 
strategy in action 
continued
case study  strategy in action
 
colleagues at the centre of our success
we have a very unique culture with engaged colleagues at the heart of our success we know 
that engaged colleagues stay with us for longer and enable us to deliver ‘pawsitively outrageous 
service’ creating strong advocacy with customers pets at home measures customer advocacy 
through the net promoter score “nps” gathered through fish4opinioncouk a customer service 
survey website operated by the group
we’re all ears
colleague engagement 
a unique culture
fish4opinion
net promoter score 
engagement
colleague
retention
pawsitively
outrageous
service
expertise
selling
through
expertise
93 colleague
engagement
score
81 colleague
retention and
47 of colleagues
are with the
company for 3
years or more
200000
hours of
training
delivered pa
strong advocacy
with customers
fish4opinion score 80
95 of store
colleagues
own pets
engaged colleagues
colleague engagement maintained at 93
colleague retention rate of 81 
pets at home won the sunday times ‘25 best
big companies to work for’ award in 2013
2014 2013 2012 2011
93 93 91 92
2014 2013 2012 2011
84 84 77 75
pets at home group plc
annual report and accounts for the year ended 27th march 2014
26
strategic report
strategy and operations 2341004    17 july 2014 532 pm    proof 9
case study  strategy in action
vip club experiencing rapid growth
our vip club provides another avenue for 
engagement with customers launched in 
november 2012 the scheme has a number of 
unique features which differentiate it from other 
loyalty programmes each time a card is swiped 
lifelines are generated for the customer’s 
chosen animal charity lifelines then convert 
to charity donations in the form of gift cards 
funded by pets at home 
we encourage our customers to register all 
their pets as part of their vip membership 
which allows us to deliver communications 
and offers directly related to their pet – 
including birthday letters membership also 
allows customers to receive a copy of the 
vip magazine with a broad range of relevant 
content and a great range of discounts and 
vouchers in each issue which has a readership 
of over 1 million 
vip club communications and targeted 
marketing allow us to cross promote relevant 
products and services as well as increase 
our share of own and private label products 
this year ahead of the wainwright’s cat food 
launch we were able to target cat owners within 
the vip club database particularly those who 
were already purchasing wainwright’s dog food 
these members were sent targeted emails 
resulting in 55 of wainwright’s cat food launch 
sales being attributable vip club members 
vip card swipe rate as a percentage  
of revenue
mar
2014
54 48 45 24 6
dec
2013
aug
2013
apr
2013
jan
2013
vip customers have a larger basket size
£1560
average basket size
for nonvip customers 
average basket size 
for vip customers
£2189
402 
vip customers also have a higher basket value compared with  
non vip customers
 vip club gained over 15 million members 
during the year ending the year with just 
under 2 million members
 over £1 million of funds raised for vip 
charities during the year 
 swipes of the vip card captured over 50 of 
all revenues at the end of the year
 voted ‘best loyalty programme’ in retail by 
the loyalty awards 2013
 my vip magazine voted ‘best consumer 
membership magazine’ by the content 
marketing association
 vip customers also have a higher basket 
value compared with non vip customers
investorspetsathomecom
london stock exchange pets
27
strategic report
strategy and operations
chief executive officer’s review 18
strategy in action 24 2341004    17 july 2014 532 pm    proof 9
28 2341004    17 july 2014 532 pm    proof 9
pictured the current vet portfolio has 158 vets4pets 
practices of which 92 were acquired in 2013
29
responsible retailing is at the heart of our business 
and is guided by our three pillars caring for the 
environment sourcing with integrity and our  
pets people
responsible retailing
goals
our goals are to be a lowcarbon lowwaste and low energy 
company to achieve this we need to inspire and engage our 
colleagues our customers our suppliers and our communities
see additional information online at
investorspetsathomecomourcompanyourservices
strategic report
corporate 
responsibility
pictured colleagues are recruited for their passion for 
pets and their desire to share their love of pets with 
customers 2341004    17 july 2014 532 pm    proof 9
as we expanded over the years we recognised that our weight of 
responsibility in these areas grew so we developed our responsible 
retailing plan
for us responsible retailing is supported by three pillars
 caring for the environment
 sourcing with integrity
 our pets people
pets at home recognises the importance of environmental and social 
issues and has in place a dedicated corporate social responsibility 
csr committee under the direction of the csr committee we 
scrutinise every aspect of our business operations and seek to 
balance the competing aims of the business to ensure that we are 
fostering the preservation and protection of the environment whilst at 
the same time recognising our wider social responsibility through all 
of our commercial activities and operations 
what this means for pets at home
caring for the environment
caring for the environment means looking at every area of our business and analysing ways 
in which we can be greener  climate change is the greatest environmental challenge facing 
the world today so we have stepped up efforts to address our impact on the environment in 
reaching our environmental objectives pets at home is committed to
corporate social 
responsibility
recycling our rubbish
taking action on waste is essential this year 
the pets at home diversion from landfill target 
was 80 pets at home exceeded this target 
by achieving 83 diversion from landfill the 
majority of waste produced by pets at home 
such as cardboard plastic and animal bedding 
is recyclable and in total 6219 tonnes was 
recycled pets at home also produced 2431 
tonnes of general waste and working with our 
service provider we diverted 964 tonnes to 
various treatment facilities such as refuge 
derived fuel rdf where waste is shredded 
and bulk burned as an alternative to fossil 
fuels general waste has also been sent to 
biomass and incineration 
we are always looking for new ways in which 
to divert our waste from landfill and this year 
we introduced dry mixed recycling dmr in 
those stores where we have both a vet and 
groom room so that we could recycle the 
plastic bottles cans cardboard paper and 
other dry general waste produced this waste 
is then sent to a waste recovery plant where 
it is recycled so that it can be used again we 
trialled this initiative in 48 stores and we have 
had some great results which can be seen in 
our total recycling figures so we are now rolling 
this out to all stores with the same format 
pets at home group plc
annual report and accounts for the year ended 27th march 2014
30
strategic report
corporate responsibility 2341004    17 july 2014 532 pm    proof 9
using less electricity
in 2007 we asked the carbon trust to look at 
ways we could use less energy since then we 
have implemented a number of their ideas this 
year we recruited green paws champs in all of 
our stores to educate other colleagues instore 
on energy reduction and possible measures 
that can be taken to reduce consumption 
green paws champs have been contacted on a 
regular basis with the store energy performance 
figures and advised on ways in which to bring 
down usage 
together with the work carried out by our green 
paws champs we have also rolled out led 
lighting into all of our stores in the aquatics 
fish tanks and also the small animal villages 
which will reduce the amount of electricity we 
use in these units the projected annual saving 
on this rollout is 1155314 kwh on aquatics 
and 190944 kwh on small animal villages 
the saving on consumption was not the only 
driver for the project there are also pet welfare 
benefits using led lights in the fish tanks 
means that less algae builds up so our fish 
have a much better environment to live in in 
the small animal villages the leds do not 
generate as much heat 
a reduction from 59 to 
28 degrees centrigrade 
resulting in a cooler and 
better environment for the 
pets and air conditioning 
not having to work as hard leds have been 
incorporated into the new store specification 
to ensure that they are installed in both the 
aquatics and the small animal villages on all 
new stores 
a signage refurbishment programme was also 
launched throughout the year so that when 
the existing fluorescent tubes on sign lights 
fail they are now replaced with equivalent led 
lamps with the average payback at less than 
one year this will be installed in all new and 
refurbished store signage going forward
next year we will start measuring the impact 
of these new fittings on our electricity 
consumption in stores
becoming more fuelefficient
we continuously focus on getting more miles 
out of every litre of fuel used in our vehicles 
in 2008 we were getting 265 kilometres per 
litre kpl in september 2013 we insourced 
the dedicated transport operations based at 
our stoke and northampton distribution centres 
dcs as part of the engagement programme 
for the drivers involved in the transition to in
house we relaunched our fuel efficiency drive 
including the driver training which has resulted 
in an improved kpl performance from 279 kpl 
in october 2013 to 282 kpl in march 2014 
in october 2011 the department of transport 
dot announced that it was preparing the 
industry to trial 900 trailers in the uk that 
would be an additional 2 metres in length from 
the current provisions this would allow the 
area of a vehicle that carries the payload in 
our case picked pallets of stock for stores 
from 136 to 1565 metres our main haulage 
service provider applied to the dot on our 
behalf for permission to be part of this trial 
and in january 2012 we were given the green 
light we commissioned four new extra length 
trailers these trailers as with most of the 
fleet are double deck trailers but instead of 
a carrying capacity of 52 pallets they can 
carry 60 pallets of stock at a time even 
though we have insourced the majority of our 
transport fleet we have retained through a 
rental arrangement with our lead third party 
provider the extra length trailers for our inter 
site trunking operation and this combined with 
continued scheduling improvements for the 
expanding store estate has further reduced 
the number of kilometres run per 1000 cases 
shipped from 1377 in fy13 to 1261 in fy14 
an improvement of 84 
investorspetsathomecom
london stock exchange pets
31
strategic report
corporate responsibility
corporate social responsibility 30 2341004    17 july 2014 532 pm    proof 9
greenhouse gas emissions reporting
this is our first greenhouse gas ghg 
emissions report in line with uk mandatory 
reporting requirements set out by the 
department for environment food  rural 
affairs defra and as a result there is no 
comparative year the mandatory requirement 
is for the disclosure of the scope 1 and 2 
emissions only these are direct emissions 
such as heating vehicle fuel and indirect 
emissions for example purchased electricity 
our total ghg footprint in line with defra’s 
mandatory reporting requirement is 40668 
tonnes co
²
e this is broken down as follows
corporate social responsibility
continued
kilometres run per 1000 
cases shipped
1261 
fy13 1377

84
did you know   
we have introduced microlise across the 
fleet – a specialist transport system that 
supports improved driver performance 
and monitoring
see additional information online at
investorspetsathomecom
pets at home group plc emissions data for period 29th march 2013 to 27th march 2014
emissions from tonnes of co
²
e
fuel usage by delivery fleet 4638 
fuel usage by company cars 1025
electricity consumption 32921
gas consumption 2084
total footprint 40668
notes the emissions declared for the delivery fleet are based on defra 2013 calculated as follows 
diesel average biofuel blend – amount of litres  260081000 
the emissions declared for company cars includes fuel used for private consumption and are based on defra 2013 and uk petrol industry association 
methodology as follows 
diesel – amount of litres 258351000 
unleaded – amount of litres 224231000 
super unleaded – amount of litres 224231000 
lpg – amount of litres or quantity  153261000 
the emissions declared for electricity and gas are for the period 1st april 2013 – 31st march 2014 in line with the carbon reduction commitment protocol 
the emissions for electricity and gas are based on crc scheme methodology and only include co
2
 emissions as follows 
electricity – amount of kwh 05411000  
gas – amount of kwh 018361000
pets at home group plc
annual report and accounts for the year ended 27th march 2014
32
strategic report
corporate responsibility 2341004    17 july 2014 532 pm    proof 9
pets before profit
pets before profit has been a core value at pets 
at home since the business was established in 
1991 we have implemented many changes over 
the years to ensure that we are doing our best to 
achieve this aim including making ‘we put pets 
before profit’ our number one value
we have a dedicated pet team in place 
consisting of an experienced veterinary surgeon 
as our head of pets who also sits on the board 
of the pet industry federation and chairs their 
pet ethics group and is a trustee of the pet 
charity she is ably assisted by two vet nurses 
one with a diploma in nursing exotic species a 
coldwater  marine biologist to look after the 
aquatics a reptile expert a pet supply manager 
who audits our suppliers and a pet operations 
manager who manages the team of nine field 
pet managers who audit the pet standards in 
our stores 
in addition to all our inhouse expertise we use 
a leading exotic specialist vet as a consultant 
who also performs an annual welfare audit 
on our primary suppliers and the exchief 
prosecution officer for the rspca who advises 
us on welfare issues
at the heart of our business is responsible pet 
ownership and it underpins the way in which we 
do business we remain committed to supplying 
small animals fish and reptiles that are 
sourced legally ethically and with due regard for 
the environment 
we continue to challenge and revise the codes 
of practice we have in place for each of our pet 
suppliers to ensure that they reflect the high 
standards we expect to be maintained 
this year we retained the services of a leading 
royal college of veterinary surgeons vet who 
will start performing an annual audit of our 
primary breeders as an extra level of external 
verification in fy15 and sai global who 
perform the red tractor audits will also be 
carrying out annual audits of our primaries from 
fy15 these are in addition to the inspections 
already carried out by our own pet team red 
tractor is a food assurance scheme which 
covers production standards developed by 
experts on safety hygiene animal welfare and 
the environment
we have revamped our store pet audit in fy14 
to place even more emphasis on reptiles 
and increased the number of store audits 
carried out by our field pet managers all 
stores continue to receive a strict annual audit 
from sai global under the pet care trust qa 
standard as we believe external verification is 
vital to maintaining standards 
we have introduced an ipad for the pet sales 
process called petpad which ensures that 
certain questions must be answered correctly 
or the sale of the pet cannot proceed to help 
ensure that we sell responsibly and match 
the owner to the right pet all colleagues are 
empowered to refuse to sell a pet if they have 
any concerns about the home to which it would 
be going we have also introduced this year 
a threeday temperature check when selling a 
reptile to ensure the environment they will be 
going into is correct thus preventing impulse 
buys of reptiles
investorspetsathomecom
london stock exchange pets
33
strategic report
corporate responsibility
corporate social responsibility 30 2341004    17 july 2014 532 pm    proof 9
our colleagues 95 of whom own pets have to 
complete a certain level of training before they 
are even allowed to sell a pet our training is 
industry leading and pet welfare is so important 
to us that all store colleagues irrespective of 
their background or previous animal related 
qualifications have to complete our training 
programme to ensure that we offer consistent 
knowledge and the latest thinking and advice to 
our customers 
the steps programme underpins our training 
which comprises four levels of detailed training 
with options to specialise in various areas 
such as ‘wet’ or ‘pet’ as you progress step 4 
was introduced this year and is taking selected 
colleagues to a high level of expertise in their 
chosen area we also have suitably qualified 
persons sqps who are trained to sell certain 
medicinal products and nutritional consultants 
who can advise customers on the best diet 
for their pet we have introduced compulsory 
continuing personal development cpd to 
ensure we stay up to date with our information
as part of our strategic partnership with the 
rspca we launched a range of cobranded pet 
care leaflets which are available free instore 
and are given away with every pet purchased
our colleagues keep a close eye on the diet 
and eating habits of our instore pets with 
centrally ordered fruit and vegetables helping 
to provide nutritional balance their homes are 
carefully monitored too we recently changed 
our rabbit and guinea pig housing from allwood 
to glass in order to reduce the risk of infection 
while our reptiles are housed in the most upto
date vivariums we also constantly review the 
products we sell to make sure that we have pet 
welfare at heart we recently phased out the 
sale of rabbit muesli in our store due to the 
potential negative effects it could have on the 
health of our customers’ rabbits
as detailed above in the section on energy 
usage we regularly invest in pet welfare and 
during the year we completed an upgrade of our 
instore fish system we have introduced led 
lighting in fish tanks and small animal villages 
as these lights reduce heating in the tanks and 
enclosures and reduce the growth of algae in 
tanks thereby reducing cleaning frequency and 
pet stress
ethical trading
our responsible sourcing approach is not 
limited to our pet suppliers we have a team 
of technical experts in both our uk support 
office and asian sourcing office in the uk we 
have four technical colleagues and a further 
five in hong kong on top of this we work very 
closely with two independent third party quality 
providers both in the uk and across asia
in the uk the technical team develops all the 
product standards that we believe allow us to 
sell products to pets that are safe legal and 
fit for purpose the role of the asian technical 
team is to ensure that these standards are 
understood and delivered against by the 
factories manufacturing our products the 
asia team alongside the aforementioned 
independent third parties is also accountable 
for ensuring that all the factories we buy from 
are audited in line with both our ethical and 
technical requirements
corporate social responsibility
continued
step
2
you and  
your store
step
2
fabulous 
furries
step
2
you and  
your team
step
2
remarkable 
reptiles
step
2
marvellous 
moggies
step
2
amazing 
aquatics
step
2
delightful 
doggies
step
2
healthy 
pets
eight titles to complete  
in any order that suits  
your role and the needs  
of your store 
client to supply relevant image
pets at home group plc
annual report and accounts for the year ended 27th march 2014
34
strategic report
corporate responsibility 2341004    17 july 2014 532 pm    proof 9
the asia team have also held and will continue 
to do so a number of supplier education 
workshops by product type with our asian 
supplier base these interactive workshops 
allow pets at home to ensure its suppliers 
are fully aware of the technical and ethical 
standards required and how these link into 
our core value of pets before profit from a 
supplier’s perspective the workshops are a 
forum to ask questions seek clarification and 
also suggest ideas that may help to further 
improve the quality of our products
on the food side of our business the uk 
technical team is also completing random 
testing on products with the help of an 
independent third party these tests allow us 
to ensure that declared ingredients nutritional 
values and various onpack claims are correct 
and in line with all legislation including dna 
testing on our meatbased products to verify the 
source of the raw ingredients
basic level reporting developed within pets at 
home allows us to monitor the performance 
of our suppliers categories and products on 
a frequent basis this data is shared with our 
suppliers on a regular basis and allows us 
to receive feedback from our customers as 
they use our products with their pets this 
information has enabled us to make changes to 
a number of our products such as our ruffer n 
tuffer range that ensure we get better every day 
and offer continually improved safe legal and  
fit for purpose products
animal testing
we are committed to ensuring that our products 
meet the highest quality and safety standards 
in the uk pet care market and so in fy13 
we developed and implemented two animal 
testing policies for food and nonfood suppliers 
these only allow nonintrusive testing of pets 
at home’s products such as tasting trials on 
pet foods plus destruction testing on dog 
toys these policies are now appended to the 
latest version of pets at home’s quality manual 
and have been issued to all suppliers during 
fy14 we continued to seek confirmation of 
adherence of our suppliers with the  
relevant policy
did you know   
95 of our colleagues own pets
see additional information online at
investorspetsathomecom
“we are committed to ensuring 
that our products meet the 
highest quality and safety 
standards in the uk pet care 
market”
investorspetsathomecom
london stock exchange pets
35
strategic report
corporate responsibility
corporate social responsibility 30 2341004    17 july 2014 532 pm    proof 9
cutting down on packaging waste
over the last year the packaging team 
has worked to reduce packaging material 
volume by continually looking to optimize 
packaging solutions whilst maintaining the 
primary function of protecting the product 
clearly providing customer information and 
communicating product propositions 
one of the most significant changes this 
year has been the move of our largest brand 
wainwright’s dry dog food from a paper 
laminated bag to a plastic laminate material 
this has resulted in a reduction in packaging 
volume by weight in excess of 30 and 
delivered a significant reduction in product 
wastage in distribution and at store level due 
to split bags currently this material is not 
recyclable through kerbside collection in the uk 
however we are continuing to pursue a material 
solution that provides widespread recyclability 
product suitability and structural integrity to 
hold 15kg
our pets at home cat litter range has made 
a similar move from paper bags into plastic 
laminate leading to a 38 reduction in material 
volume across the premium range delivering a 
volume saving of over 8000 kilos 8 tonnes 
each time the range is reprinted
we continue to support the application on 
all packaging of the wrap oprl guidelines 
through the application of on pack recycling 
icons the icons communicate the component 
level recyclability of the packaging helping 
consumers to separate waste effectively and 
recycle as much as possible 
corporate social responsibility
continued
“one of the most significant 
changes this year has been 
the move of our largest brand 
wainwright’s dry dog food from 
a paper laminated bag to a 
plastic laminate material this 
has resulted in a reduction in 
packaging volume by weight in 
excess of 30 and delivered a 
significant reduction in product 
wastage in distribution and at 
store level due to split bags”
pets at home group plc
annual report and accounts for the year ended 27th march 2014
36
strategic report
corporate responsibility 2341004    17 july 2014 532 pm    proof 9
our pets people
great place to work
the role that highly engaged highly trained 
colleagues play in the business is fundamental 
to the success of the group’s business model 
the retention and engagement of colleagues 
are key performance indicators within the 
business colleague retention was 81 in 
fy14 having increased from 541 in the 2007 
financial year and has been maintained at an 
average in excess of 80 over the past four 
financial years
pets at home participated in the sunday times 
best companies awards and was recognised 
as the best big company to work for in the 
uk in fy14 after having been placed second 
in the same awards in 2012 in 2014 we have 
entered the great place to work survey and 
will be participating in the best workplaces in 
the uk later in the year as this survey is also 
conducted across the world the results will 
establish international benchmarks
colleagues are recruited for their passion for 
both pets and people for their ability to work 
as a team and their desire to share their love 
of pets with customers as detailed above 
for our retail colleagues a structured training 
programme known as ‘steps’ is mandatory and 
takes a minimum of nine months to complete 
to encourage our trained pet experts to 
stay with the group a culture of reward and 
recognition has been built known as the ‘carrot 
culture’ rewards include the ‘earn as you 
learn’ scheme and an all colleague bonus 
scheme alongside shortterm incentives reward 
vouchers and thank you cards birthday leave 
allows colleagues to take their birthday off 
and long service is rewarded with certificates 
presents and extra holiday 
bringing the group’s values to life is a key way 
of working and creating many opportunities for 
the colleagues across the business to have fun 
whilst they work is regarded as an essential 
element in the creation of an engaged culture 
delivery of the engagement score via ‘we’re all 
ears’ is a key performance indicator included in 
senior managers’ bonus schemes
management development for the retail 
business follows a structured programme from 
‘rising stars’ to ‘fasttrack’ allowing colleagues 
to progress from colleague to store manager 
within the group’s support offices and 
distribution centres there is a range of 
development programmes from the ‘wow’ 
day a feedback and communication day 
with colleagues and structured induction 
programme to the ‘lead’ programme a 
development programme for the senior rising 
stars led by the executive team
we are also committed to ensuring a safe 
environment for all of our colleagues and 
customers and actively encourage positive 
health and safety culture throughout the 
group
support adoption for pets at home  
and other pet charities
the group continues to support the charity 
‘support adoption for pets’ “charity” through 
extensive fundraising activities in stores the 
support office and both distribution centres 
the charity raised over £25m last year with its 
largest income stream of £15m raised through 
three main fundraising events run throughout 
the year the spring and october fundraising 
drives have contributed the greatest levels of 
income and are well supported by colleagues 
customers and our suppliers the popularity 
of the raffle and the volume of ticket sales 
enabled a car to be offered as the top 
prize raising awareness and interest in the 
fundraising event which was widely promoted in 
the local press the car raffle contributed over 
£358260 towards the £457350 raised over 
the four weeks 
at christmas every store supported the new 
santa paws appeal when all of our customers 
were asked to donate 50p to provide a pet in 
a rescue with a christmas dinner this was 
incredibly well supported with 553120  
dinners being donated from 1st december  
to christmas eve 
60616 pets have also been rehomed 
through the adoption centres operated in 
our stores with £563826 in donations being 
received from their new owners the group 
continued to support the charity by investing 
in providing adoption centres in each of its 
new superstores bringing the total number 
of adoption centres to 352 the increase in 
donations and fundraising has enabled the 
charity to award £2150475 in grants over 
the last 12 months ranging from £300 to 
£120000 to fund a variety of projects for a 
wide range of rescues and rehoming centres
investorspetsathomecom
london stock exchange pets
37
strategic report
corporate responsibility
corporate social responsibility 30 2341004    17 july 2014 532 pm    proof 9
corporate social responsibility
continued
this was an increase from the £1400000 in 
grants awarded in the previous year in addition 
the charity has also been able to fund the 
development of two further rspca rehoming 
centres within our friern barnet and newport 
south wales stores bringing the rspca’s 
centres to three and also the first battersea 
dogs and cats ‘home from home’ centre in the 
sydenham store providing a further centre for 
the local charity with an international following 
these areas are manned by the charities with 
the remainder of the operating costs being paid 
for by pets at home 
the damaged stock scheme operated by both 
dcs whereby damaged stock from our two 
centres is distributed to stores for collection 
by local rescues continues to increase in 
popularity with rehoming centres since the 
introduction of the scheme over 435 rescues 
have registered and received donations this 
support is invaluable to rescues since they 
often need more than just financial help
the other charity supported over the last 
12 months was children in need a week of 
fundraising in stores using the ‘round up to 
£1’ function on our tills where customers are 
asked to round their shopping to the nearest 
pound with the difference being donated to the 
charity raised £12722 
the advent of the vip club whose reward 
currency for shopping is ‘lifeline’ points allows 
the group to further support its customers’ 
nominated pet charities as the points convert 
into gift cards which the customers’ nominated 
charities can spend in pets at home stores 
due to the success of the lifelines programme 
the group entered into an agreement in 
july 2013 to provide £2 million worth of 
wainwright’s food at retail value to feed dogs 
awaiting rehoming at the dogs trust rehoming 
centres across the uk over a threeyear period
our community
in order to promote involvement in the local 
community and competition between stores 
a few years ago we put in place ‘my pond 
league’ where each store earns points for 
the level of customer service and the number 
of local events that they hold instore this 
continues to be an important part of the 
group’s engagement with the local community 
we have worked closely with scouting 
organisations for years with our sponsorship of 
their animal care badge and to help members 
to gain this badge we offer free workshops in 
all of our stores in the year we have more than 
doubled the number of beaver and cub events 
instore in fy13 we held 277 events and 
this increased to 622 in fy14 we have also 
become the number one downloaded resource 
pack in the scouts organisation
pets rehomed through adoption centres
over 60600 
donations received from new owners
£56382610 
“at christmas every store 
supported the new santa 
paws appeal when all of our 
customers were asked to 
donate 50p to provide a pet 
in a rescue with a christmas 
dinner this was incredibly 
well supported with 553120 
dinners being donated  
from 1st december to 
christmas eve”
pets at home group plc
annual report and accounts for the year ended 27th march 2014
38
strategic report
corporate responsibility 2341004    17 july 2014 532 pm    proof 9
our colleagues also visit local schools with 
our store pets to help educate children about 
responsible pet ownership in line with the 
national curriculum we have also doubled the 
number of school visits from 204 in fy13 to 
417 in fy14
for the first time in fy14 we included local work 
experience in ‘my pond league’ and recorded 
855 local school children being given the 
opportunity to experience working life in our 
stores
all these initiative have a combined benefit 
to both the store and the business since they 
ensure that each of our stores is seen as a 
part of the local community and it also allows 
us to promote responsible pet ownership to the 
pet owners of the future
the group recognises its responsibility for 
health and safety and there is accountability 
throughout the various management levels with 
the business
our commitment to health and safety is best 
evidenced as follows
 the health and safety department are 
responsible for interpreting health and 
safety legislation and advising and guiding 
managers and colleagues in how to manage 
safely across the group
 the department is also responsible for 
assisting in the development of safety 
management systems and advising on 
safety procedures and standards across the 
group 
 the vet group has its own dedicated 
health and safety manager who reports 
to the health and safety department who 
oversees an external health and safety 
service provider and carries out inductions 
at all new practices as well as being the 
key contact for daytoday health and safety 
issues 
 all vets practices receive an annual audit 
from our external service provider 
 the vet group is now incorporated into the 
group accident reporting procedure this 
together with an improved awareness of 
the reporting process across the business 
has resulted in a 20 increase in the total 
number of reported accidents for the group 
however our accident reporting system 
continues to aid the indepth analysis of 
our accident statistics and will allow us to 
identify causes of accidents and take further 
steps to prevent them 
did you know   
our colleagues visit local schools with our 
store vets to help educate children about 
responsible pet ownership
see additional information online at
investorspetsathomecom
number of school visits in fy14
417 
fy13 204 
“our colleagues also visit local 
schools with our store pets to 
help educate children about 
responsible pet ownership 
in line with the national 
curriculum we have also 
doubled the number of school 
visits from 204 in fy13 to 417 
in fy14”
investorspetsathomecom
london stock exchange pets
39
strategic report
corporate responsibility
corporate social responsibility 30 2341004    17 july 2014 532 pm    proof 9
40 2341004    17 july 2014 532 pm    proof 9
strategic report
performance 
and financials
2014 represented another year of substantive growth 
for pets at home with improvements across a number 
of key financial metrics
growth
delivery
pets at home has delivered excellent results in the past financial 
year increasing likeforlike sales improving underlying ebitda 
margin and continuing to deliver strong cash returns on  
invested capital
see additional information online at
investorspetsathomecomourcompanyourservices
41
pictured we closely monitor colleague engagement 
through our annual ‘we’re all ears’ survey 2341004    17 july 2014 532 pm    proof 9
chief financial 
officer’ s review
pets at home group plc
annual report and accounts for the year ended 27th march 2014
42
strategic report
p erformance and financials 2341004    17 july 2014 532 pm    proof 9
ian kellett 
chief financial officer
the fy14 accounting period represents 52 weeks to 27th march 2014 the comparative fy13 period represents 52 weeks to 28th march 2013
key performance indicators
fy14 fy13 change
stores number of stores 377 345 32
new stores
1
32 32
vets number of vet practices total 277 208 69
–of which joint venture practices 267 111
– of which wholly owned group venture practices 10 5
–of which vets4pets acquisition 92
number of standalone vet practices 119 97 22
number of instore vet practices 158 111 47
– of stores with vet 42 32
new vet practices total 69 116
new standalone vet practices 22 92
new instore vet practices 47 24
–of which retrofits 18 17
groomers number of groomers 129 87 42
– of stores with groomer  34 25
new groomers  42 26
–of which retrofits 11 8
revenue revenue split £m
food 3271 2979 98
accessories 2880 2685 73
total merchandise revenue 6151 5664 86
services  other
2
503 319 574
total group revenue 6654 5983 112
likeforlike growth
3
24 26
vip club members
4
 m 20 05 15
vip swipe as  revenue 54 21
revenue mix  of total revenues
food 492 498 62 bps
accessories 433 449 159 bps
total merchandise 924 947 222 bps
services  other
3
76 53 222 bps
gross margin merchandise gross margin 
store  omnichannel 561 560 14 bps
services  other gross margin 263 225 386 bps
total gross margin 538 541 32 bps
ebitda underlying ebitda £m 1107 985 124
underlying ebitda margin 166 165 17 bps
1 fy14 openings include new format store barkers
2 includes veterinary joint venture fees and other income groom room revenue revenue from live pet sales and insurance commission
3 ‘likeforlike’ sales growth comprises total salesfee revenue in a financial period compared to revenue achieved in a prior period for stores grooming salons and vets that have been trading for  
52 weeks lfl includes revenue from the group’s online store
4 at the end of p13
investorspetsathomecom
london stock exchange pets
43
strategic report
performance and financials
chief financial officer’s review 42
risks and uncertainties 48 2341004    17 july 2014 532 pm    proof 9
chief financial officer’ s review
continued 
sales and revenue
total revenues in fy14 grew by 112 to 
£6654m fy13 £5983m with strong growth 
seen across all revenue categories food 
accessories and services 
likeforlike sales grew by 24 in the period 
driven by vip club success strength in 
advanced nutrition an omnichannel and 
the growing maturity of our groom rooms 
and vet practices cannibalisation as a result 
of new store rollout had a dilutive impact of 
around 18 on likeforlike sales growth and 
we expect a similar cannibalisation impact in 
the coming year in addition sales in june
july 2013 were adversely impacted by around 
£26m from the sustained hot weather across 
the uk hot weather results in lower footfall and 
accessories sales as shopping trips focus on 
necessities principally food
total merchandise revenues which includes 
food and accessories grew by 86 in the year 
to £6151m fy13 £5664m 
we saw solid growth in food revenues 
increasing by 98 to £3271m fy13 
£2979m reflective of strong performance in 
an where revenues grew 178 during the 
year we launched a number of new an brands 
to stores including barking heads for dogs 
and meowing heads for cats these new brand 
launches as well as the continued success of 
brands such as eukanuba arden grange and 
burns helped to drive an revenues to 56 
of total dog and cat food revenues excluding 
treats fy13 53 our private label brand 
wainwright’s dog food also continued to gain 
in popularity growing by 267 to £272m 
fy13 £214m supported by the launch 
of wainwright’s grain free weaker areas in 
food revenues included wild bird food sales 
which were negatively impacted by a mild 
autumnwinter with birds feeding adequately 
from natural sources and the discontinuation 
of rabbit muesli following research from 
edinburgh university veterinarian school which 
demonstrated negative health impacts in 
rabbits
in accessories revenues grew by 73 to 
£2880m fy13 2685m driven by innovative 
product launches across dog collars leads dog 
fashion and toys in particular the ‘summer 
brights’ dog bed collection and ‘platinum 
space’ dog range performed well as well as our 
‘rustic charm’ cat collection we experienced 
some weakness in areas which are subject to 
greater discretionary spend such as live pets 
and small animal and aquatics accessories 
services revenues grew by 574 to £503m 
fy13 £319m reflective of a full year of 
vets4pets revenues following its acquisition 
in march 2013 this partly accounts for the 
increased proportion of services revenues 
at 76 of total revenues in fy14 fy13 
53 removing the impact of the vets4pets 
acquisition services revenues still grew 
strongly by 250 reflecting in part the 
maturation from new veterinary practices and 
grooming salons as well as strong performance 
from established veterinary practices which we 
believe continue to grow at above market rates 
likeforlike revenues generated within the joint 
venture veterinary practices grew by 140 
during the year
gross margin
overall fy14 gross margin contracted by  
32bps to 538 fy13 541 which is 
attributable to a mix effect as relatively lower 
gross margin services became a larger part of 
the overall business 
gross margins within merchandise grew 
by 14 bps compared with the prior year at 
561 fy13 560 positive contributors 
to the merchandise gross margin included 
a continued benefit from improvements in 
terms negotiations as well as global sourcing 
agreements where we saw margin gains from 
the procurement of accessories through asia 
higher margin an and private label products 
such as wainwright’s were also an important 
positive contributor to margin expansion 
whilst we grew gross margins in both food and 
accessories a 59 bps sales mix shift from 
higher margin accessories to food diluted the 
overall merchandise margin gain to 14 bps 
during the year 
gross margin within the services business 
expanded to 263 fy13 225 mainly 
attributable to higher gross margin veterinary 
services being a larger part of the overall 
mix resulting from the vets4pets acquisition 
and strong likeforlike growth within existing 
practices margin synergies have been achieved 
since the acquisition combining three support 
offices into one and leveraging the significant 
scale increase resulting in the delivery of 
£27m of synergy benefits during the year 
this benefit outweighed the dilutive impact of 
increasing the number of wholly owned group 
venture gv veterinary practices by five during 
the year as well as the significant groom 
room salon rollout where recently opened 
wholly owned vet practices and newer salons 
are initially margin dilutive services and other 
gross margin was also negatively impacted by 
our investment in live pet care within stores 
where we continually invest to improve welfare 
standards
looking forward at a total gross margin level 
for the group we expect to begin to see a 
benefit from services maturation and growth 
whilst continuing to see modest merchandise 
margin expansion
operating costs
selling and distribution expenses of £2339m 
were 352 of revenue fy13 360 reflecting 
efficiency improvements in the two distribution 
centres that serve our growing store base 
rent costs continued to benefit from a 
relatively benign rental market as well as the 
expansion of the vets group with the opening 
of 18 retrofit practices instore generating 
incremental service charge income offsetting 
these improvements we have seen increased 
marketing costs from the expansion of our vip  
pets at home group plc
annual report and accounts for the year ended 27th march 2014
44
strategic report
p erformance and financials 2341004    17 july 2014 532 pm    proof 9
club alongside increased costs from ‘auto 
enrolment’ pension legislation and instore 
colleagues progressing through our ‘steps’ 
training programme
administration expenses of £348m before 
exceptional items were 52 of revenue fy13 
50 reflecting increased support for our 
rideaway business in its first full year in the 
group and higher depreciation colleague and 
licence costs in business systems following the 
successful implementation of sap 
underlying ebitda
underlying ebitda of £1107m represented a 
124 increase on the previous year fy13 
£985m attributable in part to the acquisition 
of vets4pets and rideaway at the end of 
fy13 we also saw expansion in our underlying 
ebitda margin to 166 reflecting the 
leverage from our growing services business 
which is accretive at an ebitda level all direct 
costs principally colleague costs associated 
with the delivery of the veterinary and groom 
room services are allocated at a cost of sales 
level representing the majority of the cost base 
associated with the delivery of our services 
around £19m of indirect costs are allocated 
within operating expenses
exceptional expenses of £106m during the 
year were attributable to costs associated 
with the initial public offering on 17th march 
2014 £94m and costs associated with the 
integration of the vets4pets business £23m 
net of a significant vat refund £11m
£000 fy14 fy13
operating profit
exceptional items
related party fees 
ifrs share based payment charges
underlying operating profit
depreciation and amortisation
underlying ebitda
78842 72934
10574 6049
1221 1298
31 0
90668 80281
19990 18207
110658 98488
underlying ebitda is calculated as group underlying operating profit under ifrs which includes amortisation of landlord and developer contributions received 
plus depreciation and amortisation and profits and losses on disposal where these are included in operating profit excludes exceptional items related party 
fees costs commensurate with operating the business as a publicly quoted company and ifrs2 related share based payment credits and charges
finance expense
underlying finance expense for the year was 
£375m exceptional finance expenses of 
£192m represent accelerated amortisation 
costs following the repayment of the senior 
bank facility of £5679m during the period
going forward under the new postipo capital 
structure we expect net financing costs of 
around 30 per annum
taxation and profit after tax
total tax expense for the period was £90m 
representing a tax expense of £137m on 
underlying trading profit before tax of £522m 
offset by a tax credit of £47m attributable 
to exceptional items related to the group 
restructuring as part of the ipo process 
the tax deductible items included within 
exceptionals include the amortisation of 
finance costs in relation to finance which has 
been repaid and redundancy costs associated 
with the vets4pets acquisition also included 
in exceptional costs are transaction costs 
in relation to the ipo process for which no 
corporation tax relief is assumed
“total revenues in fy14 grew 
by 112 to £6654m fy13 
£5983m with strong growth 
seen across all revenue 
categories food accessories 
and services”
investorspetsathomecom
london stock exchange pets
45
strategic report
performance and financials
chief financial officer’s review 42
risks and uncertainties 48 2341004    17 july 2014 532 pm    proof 9
within the underlying trading profit before tax of 
£522m there are some items which are non
deductible for corporation tax purposes which 
have resulted in an effective tax rate of 26 
higher than the statutory corporation tax rate 
for the period of 23 these items include an 
element of nondeductible related party interest 
and nondeductible depreciation in respect 
of capital expenditure in addition prior year 
adjustments of £09m in respect of current tax 
and deferred tax have increased the effective 
tax rate further our expected effective tax rate 
for the current financial year is 22 
profit for the period after tax was £135m 
fy13 £205m the yearonyear movement 
is representative of a £147m increase 
in exceptional costs offset by a £77m 
improvement in the profit for the period 
associated with underlying trading
net income and earnings per share
underlying trading net income for the 
period was £386m fy13 £308m after 
subtracting a dividend of £376m payable as a 
consequence of the pre ipo capital structure 
basic underlying earnings per share calculated 
on an average weighted 1751m shares in 
issue was 1 pence the weighted average 
share count for fy14 is reflective of the 166m 
shares outstanding pre ipo with 500m shares 
in issue post listing
cash flows
pets at home continues to deliver strong cash 
flow generation in fy14 the group generated 
£1246m fy13 £1150m of net cash from 
operating activities underlying unlevered free 
cash flow before interest tax and acquisitions 
was £924m fy13 £968m representing a 
cash conversion rate of 835 fy13 982 
underlying free cash flow has been adjusted 
through the removal of a  
£252m increase in other payables reflecting 
payments associated with ipo costs 
outstanding at year end 
borrowings and net debt
the group’s underlying net debt position at 
year end was £2591m adjusted for a timing 
difference in ipo and plc related costs due 
to be paid from cash received as a result of 
primary proceeds raised from the ipo this 
represents a leverage ratio of 234× underlying 
ebitda
we expect our leverage ratio to decline to 
under 20× underlying ebitda by the end of the 
current financial year and to decrease by 05× 
per annum in the following years as our cash 
flows remain adequate to fund our space rollout 
programme invest for future growth deliver 
future returns to shareholders and service debt 
chief financial officer’ s review
continued 
£000 stated leverage underlying leverage
stated gross debt 3199 3199
add back issue costs 51 51
adjusted gross debt 3250 3250
cash 908 908
less ipo related cash 249
adjusted cash 659
net debt 2342 2591
underlying ebitda 1107 1107
leverage 212× 234×
did you know   
we aim to be the number 1 omnichannel 
retailer for pet products in the uk
see additional information online at
investorspetsathomecom
“pets at home continues 
to deliver strong cash flow 
generation in fy14 the group 
generated £1246m fy13 
£1150m of net cash from 
operating activities”
pets at home group plc
annual report and accounts for the year ended 27th march 2014
46
strategic report
p erformance and financials 2341004    17 july 2014 532 pm    proof 9
working capital
working capital improved by £97m in the 
year fy13 £193m excluding a £252m 
increase in other payables reflecting payments 
associated with ipo costs outstanding at 
year end the movement in working capital is 
made up of additional investment in inventory 
of £40m and an increase in receivables of 
£80m offset by an increase in trade and other 
payables of £217m
the increase in inventory of £40m reflects the 
growth in the business specifically the opening 
of 32 new stores this increase in inventory 
is more than offset by an increase in trade 
creditors 
£51m of the increase in trade and other 
receivables relates to the timing of a 
refinancing within the vets group to ensure 
the group had sufficient facilities for new jv 
partners to draw upon to deliver our growth 
plans over the next two years this required the 
group to temporarily fund a number of practice 
openings in the latter stages of the 2014 
financial year the remaining increase in trade 
and other receivables relates to the impact 
from integrating vets4pets which is more than 
offset by a corresponding movement within 
trade and other payables as the integration 
overall delivered a net working capital benefit of 
£31m to the group
the significant increase in trade and other 
payables of £217m is partially offset by the 
increase in inventory and the integration of the 
vets4pets business as outlined above also 
contributing to the movement in trade and other 
creditors are further improvement to supplier 
terms in the group particularly in relation to 
products sourced through our sourcing office 
in asia the group also saw a working capital 
benefit in fy14 relating to the timing of easter 
in 2013 when the easter weekend fell in the 
first weekend of fy14 accelerating payments 
preyear end due to the timing of the easter 
bank holidays
going forward we expect a modest 
improvement in our working capital
capital expenditure
capital expenditure was £300m for the fy14 
fy13 £220m reflective of our new store 
openings store refurbishment programme to 
facilitate pet services retrofitting including the 
installation of mezzanines where necessary 
new services rollout and the introduction 
of sap  during the year 32 new stores were 
opened with a capital expenditure cost of 
£109m fy13 32 stores at £107m major 
refurbishment capital expenditure totalled 
£51m as 20 stores were upgraded to facilitate 
the addition of vets and groomers with two 
mezzanine floors added
in order to support the vet and groom room 
retrofit programme including mezzanine 
additions to stores we expect total capital 
expenditure requirements to increase to around 
£34–35m per year going forward which will be 
funded from operating cash flows 
dividend
the board’s current intention is to adopt a 
progressive dividend policy whilst maintaining 
an appropriate level of dividend cover allowing 
us to retain sufficient capital within the group 
to execute our growth strategy and meet our 
working capital needs whilst at the same time 
returning value to shareholders we still expect 
to target the commencement of a dividend 
payment in the fy15 with a payout ratio of 
30–40 split onethird and twothirds between 
interim and final dividends respectively
ian kellett 
chief financial officer
11th june 2014
“during the year 32 new stores 
were opened and 20 stores 
were upgraded to facilitate the 
addition of vets and groom 
rooms”
investorspetsathomecom
london stock exchange pets
47
strategic report
performance and financials
chief financial officer’s review 42
risks and uncertainties 48 2341004    17 july 2014 532 pm    proof 9
risks and 
uncertainties
an effective risk management process has been adopted to help the 
group achieve its strategic objectives and enjoy longterm success
our risk management process
the board and senior management team are collectively responsible for managing risk across the 
group on a department by department basis risks are reviewed regularly and risk registers are 
updated at least three times a year the teams meet to discuss and agree
did you know   
our vision is to be the best pet shop in 
the world
see additional information online at
investorspetsathomecom
1
key risks by 
area and any 
changes since 
the last review
2
risk ratings 
— by evaluating 
each risk and 
assigning a score
4
progress in executing 
agreed process 
improvement and 
implementing agreed 
risk mitigation
5
this process is then 
reviewedmonitored 
and reported to 
the board and audit 
committee twice a year
3
identifying the 
required actions 
against each risk
pets at home group plc
annual report and accounts for the year ended 27th march 2014
48
strategic report
p erformance and financials 2341004    17 july 2014 532 pm    proof 9
reputation
risk
the group recognises the need to protect its 
reputation
impact
failure to do so could result in a loss of 
trust and confidence by both customers and 
colleagues
mitigation 
as a retailer of small pets across a large 
number of stores the highest possible 
welfare standards must be maintained at 
all times this also extends into the supply 
chain with our pet suppliers we operate a 
comprehensive pet welfare audit process 
utilising internal and external resources 
where all stores receive unannounced visits 
on a regular basis this helps ensure our 
high standards are maintained across the 
chain with our suppliers we expect the same 
high standards of welfare and all suppliers 
are visited regularly by vets third party 
assessors our field pet team and an animal 
welfare organisation and assessed against a 
comprehensive set of welfare and standards 
criteria
the group also deals with customers’ pets on 
a daily basis through its veterinary surgeries 
groom room salons and support adoption 
centres which may on occasion result in the 
death or injury of pets whilst in our care we 
have a clear set of operational protocols 
with the veterinary practices subject to the 
professional standards mandated by the 
royal college of veterinary surgeons we also 
have highly visible field operations resource 
in respect of instore pets grooming and 
veterinary surgeries each area has specific 
resource focused on ensuring the highest pet 
welfare standards are maintained
a ‘reputational risk forum’ meets regularly 
to discuss this important area areas for 
further improvement are identified and actions 
implemented to ensure appropriate risk 
mitigation strategies are in place to protect 
our brand
competition
risk 
the group competes with a wide variety of 
retailers and vet practices including other pet 
specialists supermarkets and discounters 
online competition is also a risk as large 
well known internet businesses expand into 
pet products and the established pet product 
sites improve and expand their offer
impact
failure to keep abreast of and respond to 
developments by our competition in the areas 
of price range quality and service could have 
an adverse impact on the group’s financial 
performance and impact opportunities for 
growth
mitigation
we continue to evolve our proposition through 
the addition of vets and groomers into our 
existing store estate whilst continuing to 
innovate with the regular introduction of new 
and exclusive products into our food and 
accessory ranges as a specialist retailer the 
delivery of friendly expertise through our highly 
engagedtrained store colleagues is a key 
element of our proposition and we continue 
to invest to ensure our service standards 
as measured by our customers through 
fish4opinion are continually improved the 
pets at home website was successfully 
upgraded in january 2014 to ensure we have 
a technology platform capable of supporting 
our online strategy new site features include 
click and collect quick checkout subscription 
services and improved site layout and content 
the vip very important pet club was 
launched in november 2012 and has been 
incredibly successful – attracting just under 2 
million members at financial year end this 
customer database enables more targeted 
marketing which helps drive up basket values 
and enables us to build a stronger sense of 
engagement with our customers and their 
pets
continuous market research is carried out 
to review the pet market both at home and 
abroad and understand what our competitors 
are doing worldwide this helps identify 
further changesinitiatives that need to be 
implemented to help keep pets at home 
ahead of the competition here in the uk and 
remain a leader in the market
stores and services expansion
risk
a key part of the group’s growth strategy is to 
increase the number of stores and to grow its 
instore and standalone veterinary practices 
and groom room grooming salons
impact
if we are unable to deliver the number of 
sites necessary to fulfil the stores and 
service expansion laid out in our strategy 
our expected financial performance could be 
adversely impacted
mitigation
to successfully open a new store we have to 
in the first instance identify an appropriate 
location with lease terms that are acceptable 
any proposed new store investment has to 
deliver an appropriate financial return after 
taking into account any financial impact on 
the existing store portfolio these processes 
are equally applicable when the group looks 
to open a standalone veterinary practice 
however in common with our instore 
veterinary practice opening programme 
we also need to recruit a joint venture 
veterinary partner with the ability to fund their 
investment into the joint venture and with the 
ability to provide the personal guarantee to 
the bank providing the third party financing to 
the joint venture veterinary practice
the business maintains new store and new 
joint venture partner pipelines which identify 
potential locations and potential partners at 
each stage of our process this enables the 
board to monitor progress in delivering the 
expected number of new stores veterinary 
practices and groom rooms
investorspetsathomecom
london stock exchange pets
49
strategic report
performance and financials
chief financial officer’s review 42
risks and uncertainties 48 2341004    17 july 2014 532 pm    proof 9
risks and uncertainties
continued
our people
risk
as a specialist retailer retaining highly 
trained and engaged colleagues is 
fundamental to our continued success and 
the delivery of our future growth
impact
if we do not retain and train our colleagues it 
is unlikely that we will be able to deliver the 
outstanding customer service which is a key 
element of our proposition
mitigation
we continue to invest in training to broaden 
the skill base of colleagues across the 
business we also closely monitor colleague 
retention rates and engagement the 
latter through our annual ‘we’re all ears’ 
engagement survey which is followed up by 
‘we’re all action’ to ensure the business 
responds appropriately to opportunities 
for improvement raised by colleagues we 
also have a rolling programme of listening 
groups across the business to ensure we are 
addressing issues on an ongoing basis
as well as focusing on the development 
of existing talent within the business we 
recognise that the retention of high calibre 
talented senior management with the skills 
necessary to deliver our growth plans is 
key to our future success in this regard 
our remuneration policy as set out on 
pages 84 to 103 is designed to ensure 
executives of the necessary calibre are 
attracted and retained and that through our 
long term initiative plans and company 
share option plan colleagues across the 
business can share in our success similarly 
we continually review the remuneration and 
benefits packages available to all colleagues 
to ensure our colleagues are appropriately 
rewarded for the substantial contribution they 
make to our growth and success
business systems
risk
we are aware of the need to keep core 
business systems up to date with the 
capability to support the group’s growth 
plans
impact
if our investments in both systems and 
infrastructure do not keep pace with the 
growth of the business there may be a 
consequent limitation to our ability to trade 
and expand 
mitigation
we are in the process of upgrading our 
business critical systems to industry leading 
packages the first of which was sap which 
successfully went live this financial year our 
warehouse management system is being 
replaced with jda in the next financial year
disaster recovery is a key part of our 
systems strategy enabling us to continue 
to trade in the event of a system outage 
disaster recovery plans have been reviewed 
and updated and a schedule for regular 
testing is now in place the business also 
undertakes regular system penetration 
testing
supply chainsourcing
risk
during the financial year the group imported 
approximately 17 of its total merchandise 
via pets at home asia the group’s global 
sourcing company based in the far east 
and as a consequence we are exposed 
to the risks associated with international 
trade such as inflation changing regulatory 
frameworks and currency exposure we are 
also exposed to the risks associated with 
the quality and safety of products produced 
globally on behalf of the group many of 
which are own branded or exclusive private 
labels
impact
a failure to adequately manage this risk 
could lead to reputational damage reflected 
in a lack of confidence by customers and 
colleagues in the group brands
mitigation
having pets at home colleagues on the 
ground working collaboratively with suppliers 
enables us to monitor closely compliance 
with the group’s code of ethics and business 
conduct policy as well as compliance with 
our supplier quality manual in addition 
unannounced visits are undertaken by an 
independent third party to further monitor 
compliance with group policies
pets at home group plc
annual report and accounts for the year ended 27th march 2014
50
strategic report
p erformance and financials 2341004    17 july 2014 532 pm    proof 9
liquidity and credit risk
risk
the business requires adequate cash 
resources to enable it to fund its growth 
plans through its capital projects andor an 
expansion of the group’s working capital 
requirement
impact
without adequate cash resources the group 
may be unable to deliver its growth plans 
with a consequent impact on future financial 
performance
mitigation
a key workstream undertaken as part of 
the ipo was the assessment of the group’s 
financing requirement in the context of its 
growth plans
as a result the group is confident that it has 
adequate mediumterm financing in place 
with a broad syndicate of nine banks
the group’s growth plans in respect of joint 
venture veterinary practices is predicated 
on the availability of finance for new joint 
venture veterinary partners to fund both the 
capital cost and working capital requirement 
for each new practice opening the group 
has two revolving facilities in place with 
two major high street lenders which give us 
confidence that our mediumterm growth 
plans are financed adequately
the group ensures that all cash surpluses 
are invested with banks which have credit 
ratings and investment criteria that meet the 
requirements set out in the group treasury 
policy which has been approved by the 
board
the group’s key suppliers are exposed to 
credit risk and as part of the group’s overall 
risk management programme the business 
has identified alternative suppliers and 
developed contingency plans particularly in 
respect of own label and private label food 
products
treasury and financial risk
risk
the group has an exposure to exchange 
rate risk in respect of the us dollar which 
is the principal purchase currency for goods 
sourced from the far east
impact
if we do not adequately manage this 
exposure there could be an impact on 
the group’s financial performance with a 
consequential impact on operational and 
growth plans
mitigation
this exposure to fx fluctuation is managed 
via forward foreign currency contracts which 
are designated as cash flow hedges
the group has borrowings with floating 
interest rates linked to libor thereby 
exposing the group to fluctuations in libor 
and the consequent impact on interest cost 
to manage this risk the group has interest 
rate swaps in place which fix the interest 
rate on a significant proportion of the group 
borrowings further details can be found on 
page 139
all hedging activity is undertaken by the 
group treasury function in accordance with 
the group treasury policy which sets out the 
criteria for counterparties with whom the 
group can transact and clearly states that 
all hedging activities are undertaken in the 
context of known and forecast cashflows 
with speculative transactions specifically 
prohibited
investorspetsathomecom
london stock exchange pets
51
strategic report
performance and financials
chief financial officer’s review 42
risks and uncertainties 48 52  
governance
good corporate governance is important for ensuring 
that our business environment is fair and transparent 
and supports our delivery of sustainable good  
business performance
see additional information online at
investorspetsathomecomourcompanyourservices
pictured the group’s policy is to match the capabilities 
and talents of each individual to the appropriate job
53 board of  
directors
tony denunzio cbe        
nonexecutive chairman
committee role 
nomination  governance committee and 
the pets before profit  corporate social 
responsibility committee
current commitments
nonexecutive chairman of maxeda the second 
largest diy retailer in the benelux non
executive director of alliance boots and is a 
senior adviser to affiliates of kohlberg kravis 
roberts  colp 
appointment to the board
18th february 2014 
biography
tony joined pets at home as nonexecutive 
chairman in march 2010 tony was the former 
president and chief executive officer of asda 
from 2002 to 2005 tony brings vast retail 
experience and knowledge to the pets at home 
team
tony was previously chief financial officer of 
asda and deputy chairman of galiform now 
howdens he started his career in the fast
moving consumer goods sector with financial 
positions in unilever l’oreal and pepsico he 
has been chairman of the advisory board of 
manchester business school and was awarded 
a cbe for services to retail in 2005
dennis millard     
deputy chairman and senior independent 
nonexecutive director
committee role
nomination  governance committee audit 
committee remuneration committee and 
the pets before profit  corporate social 
responsibility committee
current commitments
dennis is currently the chairman of halfords 
group plc having joined in 2009 and is also 
the chairman of connect group plc formerly 
smith news plc having joined the group on 
31st august 2006 dennis is also currently a 
nonexecutive director and senior independent 
director of each of premier farnell plc since 
2007 and debenhams plc since 2006 
appointment to the board
18th february 2014
biography
dennis was finance director of cookson  
group plc from 1996 to 2005 and was a  
nonexecutive director of each of xchanging plc 
from 2005 until 2012 and exel plc from 2003 
until 2005
dennis is a chartered accountant and holds 
an mba from the university of cape town gsb 
dennis is also the chairman of trustees of 
the charity the holy cross children’s trust and 
owns two dogs
nick wood
chief executive officer
current commitments
nick joined pets at home as chief executive 
officer in june 2012
appointment to the board
11th february 2014
biography
from 2008 nick was chief executive officer 
of american golf a leading retailer of golfing 
equipment in the uk with over 90 standalone 
stores prior to that nick spent ten years with 
dsg international plc now dixons retail where 
he was a member of the executive committee 
and held a number of senior management 
roles including as managing director of the 
link a mobile phone retailer and as managing 
director of dixons nick graduated from gonville 
and caius college cambridge in 1989 with a 
masters degree in manufacturing engineering 
nick owns two dogs
pets at home group plc
annual report and accounts for the year ended 27th march 2014
54
governance ian kellett
chief financial officer
current commitments
ian joined pets at home as chief financial 
officer in april 2006 
appointment to the board
11th february 2014
biography
ian’s previous responsibilities included 
business systems and logistics but he is now 
primarily responsible for the group’s finance 
and supports the group’s veterinary business 
as a member of their operational board 
previous to his time at pets at home ian was 
finance director of staples’ retail business in 
the united kingdom between 2004 and 2006 
and deputy finance director of jd wetherspoon 
plc between 1999 and 2004 ian owns four 
dogs
brian carroll  
nonexecutive director
committee role
nomination  governance committee
current commitments
brian is a member of kohlberg kravis roberts 
 co partners llp  joining the buyout firm in 
1995 and is currently head of the consumer 
and retail teams in europe brian is also a 
member of kohlberg kravis roberts  co 
lp ’s european investment committee brian 
is currently also a member of the boards of 
directors of laureate education international 
cognita holdings limited smcp sas and 
northgate information solutions limited
appointment to the board
18th february 2014
biography
brian joined pets at home as a nonexecutive 
director in 2011 prior to joining kohlberg 
kravis roberts  co lp  brian was with 
donaldson lufkin  jenrette where he worked 
on a broad range of high yield financing 
corporate finance and merchant banking 
transactions he has a bs and bas from 
the university of pennsylvania and an mba 
from stanford university graduate school of 
business
gender breakdown 
male female
board of directors 78 22
senior management 80 20
group 38 62
 nomination  governance committee
tony denunzio chair 
dennis millard 
tessa green 
amy stirling 
paul coby 
brian carroll
 audit committee
amy stirling chair 
dennis millard 
paul coby 
paul moody
 remuneration committee
dennis millard chair 
tessa green 
amy stirling 
paul moody
 pets before profit  corporate social 
responsibility committee
tessa green chair 
dennis millard  
paul coby 
tony denunzio
investorspetsathomecom
london stock exchange pets
55
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 paul coby    
independent nonexecutive director
committee role
nomination  governance committee audit 
committee and the pets before profit  
corporate social responsibility committee
current commitments
paul has been it director at john lewis since 
march 2011 where he has launched a new 
platform for johnlewiscom and installed a new 
epos electronic point of sale system
appointment to the board
18th february 2014
biography
paul was cio at british airways for ten years 
where he helped to develop bacom including 
calendarbased selling of flights selfservice 
checkin and the ability to combine flight 
bookings with hotels and other services 
online paul is also chair of sita société 
internationale de télécommunications 
aéronautique the global provider of systems 
solutions and telecommunications to the air 
transport industry and a member of the board 
of po ferries before joining british airways 
paul was a civil servant in the departments of 
transport and environment where paul worked 
in ministerial private office and on roads rail 
and local government policy he studied history 
at cambridge university and owns one dog
tessa green cbe    
independent nonexecutive director
committee role
nomination  governance committee audit 
committee and the pets before profit  
corporate social responsibility committee
current commitments
tessa is currently a nonexecutive director of 
the barts health nhs trust and a trustee of the 
royal foundation of the duke and duchess of 
cambridge and prince harry 
appointment to the board
18th february 2014
biography
tessa was chairman of the royal marsden nhs 
foundation trust from 1998 to 2010 and was 
the founding chairman of the royal marsden 
cancer campaign
prior to this tessa qualified as a barrister and 
worked as head of corporate affairs at carlton 
communications plc she was a trustee of the 
national portrait gallery tessa owns one dog 
and three horses
amy stirling    
independent nonexecutive director
committee role
nomination  governance committee audit 
committee and the remuneration committee
current commitments
amy is currently the chief financial officer of 
the prince’s trust
appointment to the board
18th february 2014
biography
amy was the chief financial officer of talktalk 
telecom group plc until may 2013 having 
been with talktalk since its formation as 
part of the carphone warehouse group plc 
prior to this amy held various senior finance 
and management positions at the carphone 
warehouse group since joining in 2000 amy is 
a chartered accountant and owns one cat
board of directors
continued
pets at home group plc
annual report and accounts for the year ended 27th march 2014
56
governance paul moody   
independent nonexecutive director
committee role
audit committee and the remuneration 
committee
current commitments
paul moody has a wealth of experience in 
the fmcg and food and beverage industries 
having spent 17 years at britvic plc including 
the last eight years as chief executive since 
2013 paul has been chief executive of food 
freshness technology a high tech innovations 
company focused on delivering comprehensive 
solutions for food freshness in addition paul 
currently serves on the board of johnson 
service group as a nonexecutive director and 
was appointed as nonexecutive chairman from 
1st may 2014
appointment to the board
25th march 2014
biography
paul has held multiple posts in the food and 
beverage sector and was president of the 
british soft drinks association from 2007 to 
2009 between 1987 and 1994 he worked 
at pedigree pet foods mars in various roles 
including latterly national field sales manager 
responsible for sales teams focused on 
grocery impulse and specialist pet trade
louise stonier
company secretary
current commitments 
louise joined pets at home in 2004 as head 
of legal and company secretary and was 
promoted to group legal director in 2008 
biography
during her time at pets at home louise has 
worked on the management buyout of the 
group by bridgepoint capital limited in 2004 
the acquisition by an affiliate of kohlberg kravis 
 roberts lp  in 2010 and more recently the 
acquisition of rideaway and vets4pets and 
the listing of the pets at home group on 17th 
march this year louise is also a trustee of 
the charity support adoption for pets louise 
graduated from nottingham university with an 
llb hons and joined cms cameron mckenna 
as a trainee solicitor after qualifying as a 
corporate solicitor in 1999 louise moved 
to dla piper llp and as an associate in 
the corporate team acted on a number of 
corporate finance and ma transactions 
investorspetsathomecom
london stock exchange pets
57
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 management 
board
executive 
management t eam
nick wood
chief executive officer
date of joining the company
joined the company in june 2012
biography
nick joined pets at home as chief executive 
officer in june 2012 prior to that from 2008 
nick was chief executive officer of american 
golf a leading retailer of golfing equipment 
in the uk with over 90 standalone stores 
prior to that nick spent ten years with dsg 
international plc now dixons retail where 
he was a member of the executive committee 
and held a number of senior management 
roles including as managing director of the 
link a mobile phone retailer and as managing 
director of dixons nick graduated from gonville 
and caius college cambridge in 1989 with a 
masters degree in manufacturing engineering 
nick owns two dogs
ian kellett
chief financial officer
date of joining the company
joined the company in april 2006
biography
ian joined pets at home as chief financial 
officer in april 2006 ian’s previous 
responsibilities included business systems and 
logistics but he is now primarily responsible for 
the group’s finance and supports the group’s 
veterinary business as a member of their 
operational board previous to his time at pets 
at home ian was finance director of staples’ 
retail business in the united kingdom between 
2004 and 2006 and deputy finance director of 
jd wetherspoon plc between 1999 and 2004 
ian owns four dogs
sally hopson mbe
people and development director and chief 
executive officer of the group’ s veterinary 
business
date of joining the company
joined the company in december 2008
biography
sally is the customer people and development 
director and chief executive officer of the 
group’s veterinary business with overall 
responsibility for retail and central operations 
human resources store and format 
development live pets and services both 
veterinary and grooming she has been at pets 
at home for five years joining in december 
2008 from asda where she held a number of 
senior roles over a 14 year period a graduate 
of london university sally has worked in 
retail her entire career she is a nonexecutive 
director of jwlees a regional brewer in the 
north west of england and on the board of the 
institute of employment studies a nonprofit 
organisation a particular interest in diversity 
led to a four year role on the women in work 
commission and learning and skills council 
and she was awarded an mbe in 2006 in 
recognition of her work on diversity sally owns 
fish
pets at home group plc
annual report and accounts for the year ended 27th march 2014
58
governance peter pritchard
commercial director
date of joining the company
joined the company in january 2011
biography
peter joined pets at home in january 
2011 as commercial director and his key 
responsibilities are buying and sourcing 
marketing and omnichannel peter has 
worked in retail for 25 years in various senior 
operational and commercial roles previous 
companies include asda sainsbury’s 
iceland marks and spencer and wilkinson 
hardware stores peter has a masters degree 
in business administration from stirling 
university peter has a cat and tropical fish
phil hackney
logistics and business systems director
date of joining the company
joined the company in february 2007
biography
phil joined pets at home in february 2007 
and has primary responsibility for the group’s 
logistics supply and business systems phil 
graduated from nottingham trent university 
before starting his career with boots where 
he spent 12 years in logistics operations phil 
then spent six years working for tech data a 
global it distributor initially as the uk logistics 
director on ecommerce fulfilment operations 
before taking on responsibility for logistics 
operations in northern europe and latterly was 
part of a business team integrating mobile 
phone distribution from the us to the european 
business phil has two dogs
investorspetsathomecom
london stock exchange pets
59
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98  
directors’ report
introduction
this section of the annual report 
includes additional information 
required to be disclosed under the 
companies act 2006 “companies 
act” the uk corporate 
governance code 2010 and 
2012 code the “uk corporate 
governance code” the disclosure 
and transparency rules “dtrs” 
and the listing rules “lrs” of the 
financial conduct authority 
certain information required to be included 
in the directors’ report is included in other 
sections of this annual report as highlighted 
throughout this report and also including
•	 the strategic report on pages 17 to 27
•	 the corporate governance report on pages 
66 to 75
•	 the audit committee report on pages  
76 to 81
•	 the directors’ remuneration report on 
pages 82 to 103
incorporation listing and structure
the company was incorporated and registered 
in england and wales on 10th february 2014 
under the companies act as a public limited 
company with registration number 8885072 
and with the name pets at home group plc on 
17th february 2014 the company was issued 
with a trading certificate under section 761 of 
the companies act entitling it to commence 
business
on 17th march 2014 the company acquired 
through its wholly owned subsidiary pets at 
home no1 limited the entire issued share 
capital of pah retail limited which holds 
through certain wholly owned intermediate 
holding companies the group’s operating 
companies to become the ultimate holding 
company of the group
on 17th march 2014 the entire issued ordinary 
share capital of the company was admitted to 
premium listing segment of the official list of 
the fca and to trading on the london stock 
exchange plc’s main market for listed securities 
“listing”
the liability of the members of the company 
is limited the company is domiciled in the 
united kingdom and its registered office is at 
epsom avenue stanley green trading estate 
handforth cheshire sk9 3rn the telephone 
number of the company’s registered office is 
44 161 486 6688
principal activities
the principal activity of the group is that of 
a specialist retailer of pet food pet related 
products and pet accessories the group is 
also the operator of a small animal veterinary 
business and pet grooming salons and the 
multichannel equestrian retailer rideaway 
further information of the group’s principal 
activities is set out in the front of this report 
and in the ceo’s review on pages 18 to 23 the 
ceo’s review also provides a detailed review 
of the group’s current activities and potential 
future developments together with factors likely 
to affect future development performance and 
conditions on pages 48 to 51 
treasury and risk management
the group’s approach to treasury and financial 
risk management is explained in the key 
risks and uncertainties section on page 51 
there is also a table of the principal risks and 
uncertainties likely to affect the group 
the financial position of the group its cash 
flow liquidity position and borrowing facilities 
are described in the financial review on pages 
43 to 47 
research and development
the strategic report sets out on page 20 the 
innovation carried out by the group in relation 
to product development
greenhouse gas emissions
the board has identified and assessed the 
significant environment social and governance 
risks to the company’s short and longterm 
value as well as the opportunities to enhance 
value that may arise the corporate social 
responsibility csr report on pages 30 to 39 
reports on the environmental matters including 
the impact of the group’s businesses on the 
environment the group’s annual quantity of 
greenhouse gas emissions in tonnes of carbon 
dioxide the group’s colleagues and on social 
and community issues
health and safety
an overview of health and safety is provided 
in the csr report on page 39 and also in the 
corporate governance report on page 74
colleague engagement and  
equal opportunities
details of the group’s activities relating to 
colleague engagement are set out in the 
engagement section on page 21
details of the executive share schemes are 
set out in the directors’ remuneration report 
on pages 87 to 90 and details of colleague 
share ownership and plans are contained in the 
statement from the remuneration committee 
chairman on page 82
the group’s policy for colleagues and all 
applicants for employment is to match the 
capabilities and talents of each individual to the 
appropriate job we are committed to ensuring 
that equality of opportunity in all colleague 
relations we aim to ensure that no colleague 
potential colleague customer visitor or 
contractor will receive less favourable treatment 
on the grounds of
 sex
 pregnancy and maternity
 disability
 religious beliefs
 marital status
 race
pets at home group plc
annual report and accounts for the year ended 27th march 2014
60
governance  ethnic origin
 nationality
 age
 sexual orientation or following gender 
reassignment
 colour
applications for employment by disabled 
persons are given full and fair consideration for 
all vacancies and are assessed in accordance 
with their particular skills and abilities the 
group does all that is practicable to meet 
its responsibilities towards the training and 
employment of disabled people and to 
ensure that training career development and 
promotion opportunities are available to all 
colleagues
the group makes every effort to provide 
continuity of employment where current 
employees become disabled attempts 
are made in every circumstance to provide 
employment whether this involves adapting the 
current job role and remaining in the same job 
or moving to a more appropriate job role 
directors
the names of the persons who at any time during the financial year were directors of the 
company are 
name date of appointment date of resignation
tony denunzio 18th february 2014 na
nick wood 11th february 2014 na
ian kellett 11th february 2014 na
dennis millard 18th february 2014 na
brian carroll 18th february 2014 na
tessa green 18th february 2014 na
paul coby 18th february 2014 na
amy stirling 18th february 2014 na
paul moody 25th march 2014 na
michael adams 10th february 2014 11th february 2014
praxis management limited 10th february 2014 11th february 2014
the current company’s directors together with their biographical details and other information 
required to be included in the directors’ report are shown in the corporate governance report on 
pages 54 to 57
appointment and removal of a director 
the company may by ordinary resolution of 
the shareholders of the company at a general 
meeting remove any director from office and 
elect another person in place of a director so 
removed from office following recommendation 
by the nomination and corporate governance 
committee in accordance with its terms of 
reference for approval by the board 
pursuant to the relationship agreement 
the company has agreed with the principal 
shareholder kkr my best friend limited 
an affiliate of kohlberg kravis roberts  
co lp  the “principal shareholder” that it 
may appoint and remove two nonexecutive 
directors to the board for so long as the 
principal shareholder andor any of its 
associates when taken together holds 20 or 
more of the voting rights over the company’s 
shares and one nonexecutive director to 
the board for so long as it andor any of its 
associates when taken together holds 10 
or more but less than 20 of the voting rights 
over the company’s shares
at each annual general meeting each director 
then in office shall retire from office with effect 
from the conclusion of the meeting when a 
director retires at an annual general meeting in 
accordance with the articles the company may 
by ordinary resolution at the meeting fill the 
office being vacated by reelecting the retiring 
director in the absence of such a resolution 
the retiring director shall nevertheless be 
deemed to have been reelected except in the 
cases identified by the articles
all directors will stand for reelection on an 
annual basis in line with the recommendations 
of the uk corporate governance code
powers of the directors
subject to the articles the companies act 
and any directions given by the company by 
special resolution and any relevant statues and 
regulations the business of the company will 
be managed by the board who may exercise all 
the powers of the company
specific powers relating to the allotment and 
issuance of ordinary shares and the ability of 
the company to purchase its own securities 
are also included within the articles and such 
authorities are submitted for approval by 
the shareholders at the agm each year the 
authorities conferred on the directors prior to 
the ipo at a general meeting of the company 
held on 27 february 2014 expire on the 
date of the forthcoming agm  since listing 
the directors have not exercised any powers 
to issue or purchase ordinary shares in the 
company
directors’ interests
the directors’ interests in shares and options 
over ordinary shares in the company are shown 
in the directors’ remuneration report on 
page 100 in line with the requirements of the 
companies act each director has notified the 
company of any situation in which he or she 
has or could have a direct or indirect interest 
that conflicts or possibly may conflict with 
the interests of the company a situational 
conflict these were considered and approved 
by the board in accordance with the company’s 
articles of association and each 
investorspetsathomecom
london stock exchange pets
61
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 directors’ report
continued
director informed of the authorisation and 
any terms on which it was given the board 
has formal procedures to deal with directors’ 
conflicts of interest the board reviews and 
where appropriate approves certain situational 
conflicts of interest that were reported to it by 
directors and a register of those situational 
conflicts is maintained and will be reviewed by 
the board going forward
directors’ indemnities
the directors of the company and the 
company’s subsidiaries have the benefit of 
a thirdparty indemnity provision as defined 
by section 236 of the companies act 2006 
in the company’s articles of association in 
addition directors and officers of the company 
and its subsidiaries are covered by directors’ 
 officers’ liability insurance as well as 
prospectus liability insurance which provides 
cover for liabilities incurred by directors in 
the performance of their duties or powers in 
connection with the issue of the prospectus in 
relation to the listing of the company’s ordinary 
shares on the london stock exchange
no amount was paid under any of these 
indemnities or insurances during the year other 
than the applicable insurance premiums
share capital
the issued share capital of the company as at  
27th march 2014 and 11th june 2014 
comprises 500000000 ordinary shares of 
1p each further information regarding the 
company’s issued share capital can be found 
on page 140 of the financial statements
details of the movements in issued share 
capital during the year are provided in note 20 
to the group’s financial statements contained 
on page 140
shareholders’ voting rights 
all members who hold ordinary shares are 
entitled to attend and vote at the annual 
general meeting on a show of hands at a 
general meeting every member present in 
person shall have one vote and on a poll every 
member present in person or by proxy shall 
have one vote for every ordinary share held 
no shareholder holds ordinary shares carrying 
special rights relating to the control of the 
company
restrictions on transfer of  
ordinary shares
the articles do not contain any restrictions 
on the transfer of ordinary shares in the 
company other than the usual restrictions 
applicable where any amount is unpaid on a 
share certain restrictions are also imposed by 
laws and regulations such as insider trading 
and marketing requirements relating to close 
periods and requirements of the listing rules 
whereby directors and certain employees of the 
company require board approval to deal in the 
company’s securities
on 28 february 2014 the company 
entered into an underwriting agreement the 
“underwriting agreement” with among others 
the board excluding paul moody the senior 
executive board goldman sachs international 
merrill lynch international kkr capital markets 
limited and nomura international plc the 
“underwriters” and the principal shareholder 
in accordance with which
 the company has agreed that subject to 
certain exceptions including but not limited 
to the operation of the colleague share 
schemes not to dispose of any ordinary 
shares in the company for a period of 365 
days following listing without the prior 
written consent of the underwriters
 the preipo major corporate shareholders 
agreed not to dispose of any ordinary shares 
in the company for a period of 180 days 
following listing without the prior written 
consent of the underwriters 
 each of the directors and senior executives 
has agreed not to dispose of any ordinary 
shares for a period of 365 days following 
listing without the prior written consent of 
the underwriters 
 each of the executive directors the 
chairman and the senior executives has 
agreed with the company not to dispose 
of any ordinary shares in the company for 
an additional 365 day period in respect 
of approximately 50 of the shares held 
by them following listing without the prior 
written consent of the company
 in addition certain of the group’s colleagues 
have agreed with the company not to 
dispose of any ordinary shares for a period 
of 365 days following listing without the 
prior written consent of the company and
 certain individual preipo shareholders have 
agreed with the company not to dispose of 
any ordinary shares in the company for a 
period of 45 days following listing without 
the prior written consent of the company
all of the above arrangements are subject to 
certain customary exceptions
major interests in shares
as at 27th march 2014 and 11th june 2014 
the company has been notified pursuant to 
dtr5 of the following interests representing 3 
or more of the issued ordinary share capital of 
the company 
pets at home group plc
annual report and accounts for the year ended 27th march 2014
62
governance name of 
shareholder
number of ordinary 
shares as at 
27th march 2014
 of issued 
share capital 
number of ordinary 
shares as at 
11th june 2014
 of issued  
share capital
nature of holding 
directindirect
kkr my best friend limited 186616538 373 186616538 373 direct
bank of america corporation 60034403 120 0 0 indirect
mbf coinvest lp  44396548 89 44396548 89 direct
schroders plc 29224785 58 29224785 58 indirect
gic private limited 18543371 37 25112894 50 direct
an affiliate of kohlberg kravis roberts  co lp 
transactions with related parties
the only material transactions with related 
parties during the year were
 kkr my best friend relationship 
agreement relationship agreement 
this relationship agreement was entered 
into on 28th february 2014 and regulates 
the relationship between kkr my best 
friend limited principal shareholder and 
the company following listing subject 
to a certain minimum shareholding 
the relationship agreement details the 
rights the principal shareholder has to 
representation on the board and nomination 
and corporate governance committee 
appoint observers to the remuneration 
audit and the pets before profitcsr 
committee and certain antidilution rights 
the company has also undertaken to 
cooperate with the principal shareholder 
in the event of a sale of the shares by the 
principal shareholder at any time following 
the offer
 reorganisation agreement this 
reorganisation agreement was entered 
into on 28th february 2014 between 
amongst others the company the 
principal shareholder certain group 
companies the executive directors and the 
senior executives and contained certain 
reorganisation steps that took place in 
connection with the ipo within the group
 senior facilities agreement kkr capital 
markets “kcm” an affiliate of the principal 
shareholder is entitled to receive a 
syndication agent fee equal to 050 of the 
total commitments under the terms of the 
senior facilities agreement “sfa” entered 
into in connection with the listing further 
details of the group’s banking facilities are 
shown in note 17 on pages 138 and 139 of 
the financial statements
 ccmsl loan agreement a loan agreement 
entered between kkr corporate lending 
uk llc as lender and companion care 
management services limited “ccmsl” 
as borrower the “loan agreement” kkr 
capital markets limited received a fee 
equal to £400000 being 2 of the total 
commitments under the loan agreement 
ccmsl received a 50 rebate of this fee as 
the loan agreement was refinanced on  
31st march 2014
 engagement letter on 18th february 
2014 kcm together with other joint global 
coordinators entered into an engagement 
letter with pets at home interco limited 
in respect of the provision of services in 
connection with the listing 
 underwriting agreement the company 
and the principal shareholder have entered 
into the underwriting agreement referred to 
above
 advisory services agreement on  
19th march 2010 pah uk bidco limited 
entered into an advisory services agreement 
with kohlberg kravis roberts  co lp  
the “adviser” an affiliate of the principal 
shareholder for the provision of certain 
consulting and management advisory 
services to the group the “advisory 
services agreement” the agreement 
terminated on listing
 nw pah investments llp in march 2013 
pets at home limited nick wood and an 
affiliate of the principal shareholder the 
“kkr investor” entered into arrangements 
to facilitate the acquisition by nw pah 
investment llp  a limited liability partnership 
incorporated under the united kingdom 
limited liability partnerships act 2000 
and controlled by nick wood and kkr 
investor of shares in manco 1 limited the 
amount of capital invested by kkr investor 
of £700000 was lent to kkr investor 
pursuant to a loan agreement with pets 
at home limited the return on capital 
invested by kkr investor accrued at 8 
per annum compounded annually and was 
calculated on a daily basis prior to listing 
nw pah investments llp distributed its 
assets to nick wood and kkr investor 
in accordance with the reorganisation 
agreement nw pah investments llp is in 
the process of being dissolved kkr investor 
repaid all amounts owed to pets at home 
limited following receipt of payment from 
nick wood
 consultancy agreement under the terms 
of this agreement denunzio associates 
ltd a company in which tony denunzio is 
interested provided consulting services to 
the group this agreement was terminated 
on admission
further details are contained in note 26 on 
pages 155 to 156 of the financial statements
investorspetsathomecom
london stock exchange pets
63
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 directors’ report
continued
amendment of the articles
the articles of association may only be amended 
by a special resolution of the company’ s 
shareholders in a general meeting in accordance 
with the companies act
dividend
the directors are not proposing to recommend 
any dividend in respect of fy14
change of control
there are no agreements between the company 
and its directors or employees providing for 
additional compensation for loss of office or 
employment whether through resignation 
redundancy or otherwise that occurs because 
of a takeover bid
the only significant agreements to which the 
company is a party that take effect alter or 
terminate upon a change of control of the 
company following a takeover bid and the 
effect thereof are as follows
 the relationship agreement with the 
principal shareholder contains a provision 
allowing the principal shareholder to 
terminate the agreement with immediate 
effect if any person acquires control of the 
company namely holding andor ownership 
of the beneficial interest in andor the ability 
to exercise the voting rights applicable to 
shares or other securities in the company 
which confer in aggregate on the holders 
whether directly or indirectly more than 50 
of the voting rights exercisable at general 
meetings of the company or the company 
ceases to be on the official list of the uk 
listing authority
 the sfa contains customary prepayment 
cancellation and default provisions 
including if required by a lender mandatory 
prepayment of all utilisations provided 
by that lender upon the sale of all or 
substantially all of the business and assets 
of the group or a change of control
political donations
the company’s policy is not to make any 
political donations and no political donations  
or expenditure were made or incurred during 
the year
suppliers
the group understands the importance of 
maintaining good relationships with suppliers 
and it is group policy to agree appropriate 
terms and conditions for its transactions with 
suppliers ranging from standard written terms 
to individually negotiated contracts and for 
payment to be made in accordance with these 
terms provided the supplier has complied with 
its obligations average trade creditors of the 
group’s uk operations for fy14 were 38 days 
fy13 32 days
events post year end
in the company’s ipo prospectus the company 
noted its intention to reduce its share capital 
by means of a court sanctioned reduction in 
capital the capital reduction was approved 
by a special resolution passed at the general 
meeting of the company on 27th february 
2014 and will require court approval it is 
envisaged that the final court hearing to 
formally approve the proposed reduction of 
capital will take place before september 2014
going concern
on the basis of current financial projections and 
facilities available the directors are satisfied 
that the group is well placed to manage its 
business risks successfully and therefore have 
a reasonable expectation that the group has 
adequate resources to continue in operational 
existence for the foreseeable future 
accordingly the financial statements continue 
to be prepared on a going concern basis
branches outside of the uk
the company has no branches outside of  
the uk 
auditors
so far as each director is aware there is 
no relevant audit information of which the 
company’s auditors are unaware and the 
directors have taken all the steps which 
they ought to have taken as directors to 
make themselves aware of any relevant audit 
information and to establish that the company’s 
auditors are aware of that information
this confirmation is given and should be 
interpreted in accordance with the provisions of 
s418 of the companies act
on behalf of the board the audit committee 
has reviewed the effectiveness performance 
independence and objectivity of the existing 
external auditors kpmg llp  for the year ended 
27th march 2014 and concluded that the 
external auditors were in all respects effective 
kpmg llp has expressed its willingness to 
continue in office as auditors accordingly a 
resolution proposing the reappointment of 
kpmg llp will be proposed at the forthcoming 
agm and will be put to the shareholders at the 
meeting
approval of annual report
the strategic report and the corporate 
governance report were approved by the  
board on 11th june 2014
approved by the board and signed on its  
behalf by
louise stonier 
group company secretary 
11th june 2014
pets at home group plc
annual report and accounts for the year ended 27th march 2014
64
governance statement of directors’ responsibilities 
in respect of the annual report and the 
financial statements
the directors are responsible for preparing 
the annual report and the group and parent 
company financial statements in accordance 
with applicable law and regulations 
company law requires the directors to prepare 
the group and parent company financial 
statements for each financial year under that 
law they are required to prepare the group’s 
financial statements in accordance with 
international financial reporting standards 
“ifrs” as adopted by the european union 
eu and applicable law and they have elected 
to prepare the parent company financial 
statements on the same basis under company 
law the directors must not approve the financial 
statements unless they are satisfied that 
they give a true and fair view of the state of 
affairs of the group and their parent company 
financial statements and of the profit or loss 
of the group for that period in preparing each 
of the group and parent company financial 
statements for each financial year the directors 
are required to 
 select suitable accounting policies and then 
apply them consistently
 make judgements and accounting estimates 
that are reasonable and prudent
 state whether they have been prepared in 
accordance with ifrss as adopted by the 
eu and
 prepare the financial statements on 
the going concern basis unless it is 
inappropriate to presume that the company 
will continue in business
the directors are responsible for keeping 
adequate accounting records that are sufficient 
to show and explain the parent company’s 
transactions and disclose with reasonable 
accuracy at any time the financial position 
of the parent company and enable them to 
ensure that its financial statements comply 
with the companies act 2006 they have 
general responsibility for taking such steps as 
are reasonably open to them to safeguard the 
assets of the group and to prevent and detect 
fraud and other irregularities
under applicable law and regulations the 
directors are also responsible for preparing 
a strategic report directors’ report 
directors’ remuneration report and corporate 
governance statement that complies with that 
law and those regulations
the directors are responsible for the 
maintenance and integrity of the corporate and 
financial information included on the company’s 
group website legislation in the uk governing 
the preparation and dissemination of financial 
statements may differ from legislation in other 
jurisdictions
responsibility statement of the directors 
in respect of the annual financial report
we confirm that to the best of our knowledge
 the financial statements prepared in 
accordance with the applicable set of 
accounting standards give a true and fair 
view of the assets liabilities financial 
position and profit or loss of the company 
and the undertakings included in the 
consolidation taken as a whole and
 the strategic reportdirectors’ report 
includes a fair review of the development 
and performance of the business and the 
position of the issuer and the undertakings 
included in the consolidation taken as a 
whole together with a description of the 
principal risks and uncertainties that they 
face
approved by the board and signed on its  
behalf by
nick wood 
chief executive  
officer
11th june 2014
ian kellett 
chief financial 
officer
11th june 2014
investorspetsathomecom
london stock exchange pets
65
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 corporate 
governance report
pets at home group plc
annual report and accounts for the year ended 27th march 2014
66
governance dear shareholders
welcome to our first corporate governance 
report the shares of pets at home group plc 
were admitted to the premium listing segment 
of the official list maintained by the financial 
conduct authority and to trading on the london 
stock exchange listing on 17th march 2014 
the board recognises the importance of and is 
committed to high standards of plc corporate 
governance and all directors are fully aware of 
their duties and responsibilities under the uk 
corporate governance code the disclosure 
and transparency rules and the listing rules 
save as set out in this report the board 
considers that the group has complied with the 
requirements of the code from listing to the 
financial year end on 27th march 2014
in preparation for listing we carried out a 
review of the existing governance structure 
in conjunction with our advisers kpmg llp  
in order to identify any measures that would 
need to be implemented prior to listing the 
review also enabled the directors to provide 
the confirmation that was required on listing 
that pets at home has established procedures 
in place which provide a reasonable basis for 
the board to make proper judgements on an 
ongoing basis as to the financial position and 
prospects of the group based on the findings 
of the review we found that the following 
actions would need to be taken pre ipo
 strengthen the independence of the board 
and the committees through the addition of 
five independent nonexecutive directors
 set up a formal induction process for new 
nonexecutive directors joining preipo and 
postipo
 amend the current board and committee 
terms of reference to ensure suitability for a 
plc board and all its subcommittees
 agree an approach to investor relations with 
the plc board and
 the remuneration committee to set a 
formal executive remuneration evaluation 
process
we undertook a rigorous process with korn 
ferry to identify suitable independent non
executive directors with dennis millard 
amy stirling tessa green and paul coby 
being appointed prior to listing with the final 
appointment of paul moody taking place shortly 
after dennis millard was appointed deputy 
chairman and senior independent director 
each independent nonexecutive director has a 
proven track record in business at a senior level 
and expertise of relevance to the company
in the period leading up to the ipo the new 
directors received a full induction process so 
that they could familiarise themselves with 
the group through a combination of personal 
meetings with the senior executives and 
members of the operating board a store and 
veterinary surgery visit and time spent reviewing 
and approving on the ipo offer documents
tony denunzio 
nonexecutive chairman
chairman’ s governance statement
membership of
the board
chairman   
executive directors 
nonexecutive directors 
independent nonexecutive directors 
see pages 54 to 56 for board  
of directors
investorspetsathomecom
london stock exchange pets
67
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 chairman’ s governance statement
continued
following the ipo we have put in place a more 
tailored induction process for each of the new 
directors including paul moody and the board 
calendar has been planned to ensure that 
directors are briefed on a wide range of topics 
have the opportunity to visit the group’s various 
business locations and discuss aspects of the 
group’s activities with colleagues across the 
business 
we have implemented a committee structure 
in accordance with the requirements of a 
premium listed plc the membership roles and 
activities of the committees are detailed in 
separate sections of this report together with 
reports of the audit and risk committee and 
remuneration committee there is no separate 
report of the nominations committee as the 
board of directors was newly appointed and 
as a consequence there has been no need for 
the committee to meet on a formal basis in the 
short period between listing and the year end 
we recognise the importance of communicating 
to our shareholders and so shortly after listing 
we appointed a dedicated head of investor 
relations amie gramlick investor relations will 
be led by the chief executive officer and chief 
financial officer with support from amie a full 
programme of regular meetings and dialogue 
with major institutional shareholders fund 
managers analysts retail brokers and credit 
investors has been established and the board 
will receive regular updates at board meetings 
during the ipo process deloitte llp were 
engaged as the remuneration adviser they 
advised on the remuneration policy which sets 
down the group’s forwardlooking policy on the 
remuneration of executive and nonexecutive 
directors and is contained at pages 82 to 103 
of this report
i look forward to continuing with the company 
as nonexecutive chairman as we continue with 
the transition from private company to a plc we 
believe that good corporate governance allows 
boards to direct their companies effectively 
and we are pleased to present our report on 
the governance arrangements the board has 
adopted since the ipo on 17th march 2014
tony denunzio 
chairman pets at home group plc
11th june 2014
“in preparation for listing 
we carried out a review of the 
existing governance structure 
in conjunction with our advisers 
kpmg llp  in order to identify 
any measures that would need 
to be implemented prior to 
listing”
pets at home group plc
annual report and accounts for the year ended 27th march 2014
68
governance corporate governance report
introduction
the board is committed to the 
highest standards of corporate 
governance save as set out in the 
paragraphs below since listing 
the board has complied with and 
intends to continue to comply 
with the requirements of the uk 
corporate governance code 
published in september 2012 by 
the financial reporting council 
the “uk corporate governance 
code” the company will also 
report to its shareholders on its 
compliance with the uk corporate 
governance code in accordance 
with the listing rules “lrs” 
board balance and independence
the uk corporate governance code 
recommends that at least half the board of 
directors of a uklisted company excluding 
the chairman should comprise nonexecutive 
directors determined by the board to be 
independent in character and judgement and 
free from relationships or circumstances 
which may affect or could appear to affect 
the director’s judgement the pets at home 
group plc board consists of five independent 
nonexecutive directors one nonexecutive 
chairman one nonindependent nonexecutive 
director appointed by kkr my best friend 
limited an affiliate of kohlberg kravis roberts 
 co lp  the “principal shareholder” and two 
executive directors a list of the directors is 
provided on pages 54 to 57
chairman 
the uk corporate governance code 
recommends that on appointment the 
chairman of a company with a premium 
listing on the official list should meet the 
independence criteria set out in the uk 
corporate governance code tony denunzio 
joined pets at home in 2010 and has been 
nonexecutive chairman of the group since 
march 2010 notwithstanding that the board 
considered at the time of listing and continues 
to believe that tony denunzio does not meet 
the independence criteria set out in the uk 
corporate governance code the board believes 
that in order to ensure maximum continuity 
in the company’s transition from a privately 
owned company to a listed company tony 
should remain as nonexecutive chairman of 
the group the board believes tony brings vast 
retail experience and knowledge to the pets at 
home team tony is nonexecutive chairman 
of maxeda a major benelux diy retailer and 
is a nonexecutive director of alliance boots 
group tony is a senior adviser to affiliates of 
the principal shareholder and was appointed 
as nonexecutive chairman by the principal 
shareholder kkr my best friend limited 
an affiliate of kohlberg kravis roberts  co 
lp  pursuant to the terms of the relationship 
agreement entered into as part of the ipo 
process to avoid potential future conflicts of 
interest relationship agreement
senior independent director
the uk corporate governance code 
recommends that the board of directors of a 
company with a premium listing should appoint 
one of the nonexecutive directors as a senior 
independent director to provide a sounding 
board for the chairman and to serve as an 
intermediary for the other directors when 
necessary the senior independent director 
should be available to shareholders if they have 
concerns when contact through the normal 
channels of the chief executive officer has 
failed to resolve or for which such contact is 
inappropriate 
dennis millard has also been appointed deputy 
chairman as well as senior independent 
director and has considerable experience 
of acting as an independent nonexecutive 
director on plc boards dennis is currently the 
chairman of halfords group plc and is the 
chairman of smiths news plc dennis is also 
currently a nonexecutive director and senior 
independent director of each of premier farnell 
plc and debenhams plc
appointment of directors by the  
principal shareholder
pursuant to the relationship agreement 
the company has agreed with the principal 
shareholder that it may appoint two non
executive directors to the board for so long 
as the principal shareholder andor any of its 
associates when taken together holds 20 or 
more of the voting rights over the company’s 
shares and one nonexecutive director to 
the board for so long as it andor any of its 
associates when taken together holds 10 
or more but less than 20 of the voting rights 
over the company’s shares the principal 
shareholder has appointed brian carroll as 
a nonexecutive director of the board the 
chairman tony denunzio is a senior adviser 
to affiliates of the principal shareholder and 
therefore is not deemed to be independent of 
the principal shareholder although he has not 
been appointed as a director by the principal 
shareholder the principal shareholder has 
agreed that for so long as it has the right to 
appoint two directors to the board and tony 
is a director the principal shareholder shall 
not exercise its right to appoint a second 
director to the board for further details of the 
relationship agreement see page 63
board observers
each of sally hopson peter pritchard and 
phil hackney have been appointed as board 
observers with rights to receive notice of 
including all board papers attend and speak 
at board meetings the principal shareholder 
also has the right to appoint one board 
observer for so long as it holds voting rights 
over more than 10 of the company’s shares 
such board observers shall have the right to 
receive notice of attend and speak at board 
meetings no board observer shall be entitled 
to vote on any matter requiring a resolution of 
the board
investorspetsathomecom
london stock exchange pets
69
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 67
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 corporate governance report
continued
appointment terms and  
elections of directors
all directors have service agreements or letters 
of appointment in place and the details of their 
terms are set out in the remuneration report 
on pages 93 to 95 the service agreements 
and letters of appointment are available for 
inspection at the company’s registered office 
during normal business hours 
the uk corporate governance code 
recommends that directors of companies in the 
ftse 350 index should be subject to annual  
reelection the company intends to comply 
with these recommendations
how the board operates
pets at home group plc has established a 
clear division of responsibilities between the 
respective responsibilities of the nonexecutive 
chairman of the board and the chief executive 
officer this separation of responsibilities 
between the chairman and the chief executive 
officer coupled with the reserved matters 
described below ensures that no individual has 
unfettered powers of decisionmaking
the matters reserved for the board include
 agreement of the group’s strategy
 changes to the structure and capital of the 
group
 reviewing the effectiveness of internal 
controls
 approval of the annual report and 
accounts interim reports and interim 
management statements together with any 
announcements
 approving significant expenditure material 
transactions and contracts
 reviewing and agreeing group tax and 
treasury policy
 delegation of authority to the chief 
executive officer
 board and senior management 
appointments arrangements and 
succession planning
 communication with shareholders
 review of the group’s overall corporate 
governance matters
it is important to the board that nonexecutive 
directors have the ability to influence and 
challenge appropriately new directors receive 
a full formal and tailored induction on joining 
the board including meeting with the executive 
management and other members of the group’s 
operating board and advisers the induction 
includes visits to the group’s stores veterinary 
surgeries and other operational locations
as a result of the short period between listing 
on 17th march 2014 and the year end on  
27th march 2014 the current board held one 
meeting in future the board intends to meet at 
least eight times per year with additional  
ad hoc meetings as required 
topics for the board meetings are determined 
at the beginning of the year and new items are 
added to this as and when appropriate
all directors receive papers in advance of 
board meetings these include a monthly 
board report with updates from each of the 
executive management team and the operating 
board which monitors the achievements of 
the group’s key performance indicators both 
financial and strategic the group’s operating 
board are also invited to present at board 
meetings so that nonexecutive directors keep 
abreast of developments in the group 
governance structure
see pages 76 to 103 for
committee reports   
  
plc board
audit 
committee
pets before proﬁts   
csr committee
nomination
committee
remuneration
committee
 tony denunzio chair
 amy stirling chair
 dennis millard chair
 tessa green chair
pets at home group plc
annual report and accounts for the year ended 27th march 2014
70
governance board evaluation and effectiveness
the group legal director and company 
secretary ensures the board is made aware 
of new laws regulations and other information 
appropriate to the group to ensure that 
all directors continually update their skills 
knowledge and familiarity of the group in order 
to fulfil their roles additionally each director 
has access to the advice and services of the 
company secretary and also has the ability to 
take independent external advice if required
considering diversity
at the time of the ipo the process of recruiting 
independent nonexecutive directors with 
a broad range of skills to complement the 
business took into account diversity the 
board understands the importance of having 
a diverse membership and recognises that 
diversity encompasses not only gender but also 
background and experience the board believes 
that appointments should be made solely on 
the chairman intends to meet regularly with the 
nonexecutive directors without the executive 
directors present this ensures that any 
concerns can be raised and discussed outside 
formal board meetings the senior independent 
director will also attend these sessions where 
possible and if required will discuss any 
pertinent matters with the other independent 
nonexecutive directors
it is important to the group that all directors 
understand external views of the group it 
is the intention that regular reporting will be 
provided to the board by the company’s head 
of investor relations covering broker reports 
and the output of meetings with significant 
shareholders as stated below the board has 
also delegated certain matters to a number of 
board committees
number of meetings attended 
attendance from listing on 17th march 2014 to the year end for all scheduled board and board 
committee meetings is given in the table below 
board remuneration
number of meetings
1
1 1
director
2
board remuneration
tony denunzio chairman 1 —
dennis millard deputy chairman 1 1
nick wood 1 —
ian kellett 1 —
amy stirling 1 1
tessa green 1 1
paul coby 1 —
paul moody
3
1 —
brian carroll 1 —
1 excludes meetings held in relation to the ipo the audit committee and the nomination committee have not met during  
the period
2 only attendance of formal members of the meetings is included attendance as an observer is not included
3 paul moody did not attend the remuneration committee in his capacity as a director on 25th march 2014 since he was not 
appointed to the committee until after the meeting he attended as an observer
merit the key criterion being whether or not 
the appointee can add to or complement the 
existing range of skills and experience on the 
board notably two of the five newly appointed 
independent nonexecutive directors tessa 
green and amy stirling are females together 
with the group legal director and company 
secretary louise stonier and a member of the 
executive management team sally hopson 
these appointments were made on merit and 
not on gender the appointees being by far the 
strongest candidates for the positions with 
their skill sets and overall experience fitting the 
objective role description approved by the board 
at the outset of the recruitment process
this policy applies equally to all appointments 
in the company and so two of the most recent 
appointments to the board of the pets at home 
vets group were female sally hopson and 
amanda radford in addition to the existing 
serving managing director jane balmain the 
group also has four female colleagues on the 
operating board
the company used an external search 
consultancy korn ferry in the appointment of 
all independent nonexecutive directors during 
the period
investorspetsathomecom
london stock exchange pets
71
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 corporate governance report
continued
board committees 
the board has established three committees 
of the board an audit and risk committee 
a nomination and corporate governance 
committee and a remuneration committee  
in addition the board has also established the 
pets before profit and csr committee which 
will comprise both nonexecutive directors 
and colleagues and the investment committee 
which will comprise the executive directors and 
other members of the executive management 
and colleagues if the need should arise the 
board may set up additional committees as 
appropriate
audit and risk committee
the audit and risk committee has delegated 
responsibility from the board for 
  agreeing the scope of the annual audit of 
the consolidated accounts and the annual 
audit plan and monitoring the same
  monitoring making judgements and 
recommendations on the financial reporting 
process and the integrity and clarity of the 
group’s financial statements
  considering the appointment of the group’s 
auditors and their remuneration including 
reviewing and monitoring of independence 
and objectivity and agreeing and monitoring 
the extent of the nonaudit work that may be 
undertaken
  reviewing and monitoring the effectiveness 
of the internal control internal audit and risk 
management policies and systems in place 
and
  reporting to the board on how it has 
discharged its responsibilities
the audit committee gives due consideration 
to laws and regulations the provisions of 
the uk corporate governance code and the 
requirements of the lrs the uk corporate 
governance code recommends that an audit 
committee should comprise at least three 
members who are independent nonexecutive 
directors and that at least one member should 
have recent and relevant financial experience 
the audit and risk committee is chaired by 
amy stirling and its other members are dennis 
millard paul coby and paul moody as a former 
chief financial officer of talk talk telecom group 
plc the directors consider that amy stirling 
has recent and relevant financial experience 
in accordance with the requirements of the uk 
corporate governance code the audit and 
risk committee meets not less than three 
times a year
only committee members have the right 
to attend and vote at its meetings but the 
principal shareholder has a right to appoint an 
observer to attend meetings of the audit and 
risk committee for so long as it andor any of 
its associates when taken together holds 10 
or more of the voting rights over the company’s 
shares
the audit and risk committee chair will be 
available at annual general meetings of 
the company to respond to questions from 
shareholders on the activities of the audit and 
risk committee
the audit and risk committee has taken 
appropriate steps to ensure that the company’s 
auditors are independent of the company 
and obtained written confirmation from the 
company’s auditors that they comply with 
guidelines on independence issued by the 
relevant accountancy and auditing bodies
the audit and risk committee has access to 
sufficient resources to carry out its duties 
including the services of the group legal 
director and company secretary and the 
group’s internal audit function independent 
external legal and professional advice can also 
be taken by the audit and risk committee if it 
believes it necessary to do so
the audit and risk committee’s terms of 
reference which are available on request from 
the company secretary and are published on 
the group’s website investorspetsathome
com comply with the code
remuneration committee
the remuneration committee assists the 
board in determining its responsibilities in 
relation to directors’ remuneration including
 making recommendations to the board 
on the company’s policy on executive 
remuneration
 setting the overarching principles 
parameters and governance framework 
of the group’s remuneration policy and 
determining the individual remuneration and 
benefits package of each of the company’s 
executive directors and executive 
management
 ensuring compliance with the uk 
corporate governance code in relation to 
remuneration
pets at home group plc
annual report and accounts for the year ended 27th march 2014
72
governance the uk corporate governance code provides 
that a remuneration committee should 
comprise at least three members who are 
independent nonexecutive directors other 
than the chairman the remuneration 
committee is chaired by dennis millard and its 
other members are tessa green amy stirling 
and paul moody all of whom are independent 
nonexecutive directors the remuneration 
committee will meet not less than twice a year 
nonexecutive directors’ and the chairman’s 
fees are determined by the full board 
only committee members have the right 
to attend and vote at its meetings but the 
principal shareholder has a right to appoint 
an observer to attend meetings of the 
remuneration committee for so long as it and
or any of its associates when taken together 
holds 10 or more of the voting rights over the 
company’s shares
the remuneration committee has access to 
sufficient resources to carry out its duties 
including the services of the group legal 
director and company secretary and the 
group’s customer people and development 
director independent external legal and 
professional advice can also be taken by 
the remuneration committee if it believes it 
necessary to do so
the remuneration committee’s terms of 
reference which are available on request from 
the company secretary and are published on 
the group’s website investorspetsathome
com comply with the code
nomination and corporate  
governance committee
the nomination and corporate governance 
committee assists the board in
 discharging its responsibilities relating to 
the composition and makeup of the board 
and any committees of the board
 periodically reviewing the board’s structure 
and identifying potential candidates to 
be appointed as directors or committee 
members as the need may arise
 the consideration and development 
of appropriate corporate governance 
principles including amongst other things 
those relating to potential related party 
transactions
 evaluating the balance of skills knowledge 
and experience and the size structure and 
composition of the board and committees 
of the board retirements and appointments 
of additional and replacement directors and 
committee members making appropriate 
recommendations to the board on such 
matters
the uk corporate governance code 
recommends that a majority of the members of 
a nomination committee should be independent 
nonexecutive directors the nomination and 
corporate governance committee is chaired 
by tony denunzio and its other members are 
dennis millard paul coby tessa green amy 
stirling and brian carroll the nomination and 
corporate governance committee will meet not 
less than once a year 
the nomination and corporate governance 
committee has access to sufficient resources 
to carry out its duties including the services 
of the group legal director and company 
secretary independent external legal and 
professional advice can also be taken by 
the nomination and corporate governance 
committee if it believes it necessary to do so
the nomination and corporate governance 
committee’s terms of reference which are 
available on request from the company 
secretary and are published on the group’s 
website investorspetsathomecom comply 
with the code
other pets at home committees
pets before profit and corporate social 
responsibility csr committee
the pets before profit and csr committee 
assists the board in
 ensuring that matters in respect of the 
welfare standards of all pets sold within 
the group’s stores are managed effectively 
and proactively throughout the group in 
accordance with the group’s core value of 
‘pets before profit’
 reviewing proposals for the introduction of 
new species for sale in the group’s stores
 compliance with and the development of 
legislation which will affect the sale of pets 
in stores and all ethical matters in respect 
of the supply transportation and sale of 
pets
 reviewing all the individual elements of the 
group’s csr strategy including caring for the 
environment sourcing with integrity and ‘our 
pets people’
investorspetsathomecom
london stock exchange pets
73
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 corporate governance report
continued
the pets before profit and csr committee is 
chaired by tessa green and its other members 
are tony denunzio dennis millard and paul 
coby a number of the group’s colleagues 
including the executive management are also 
entitled to attend meetings of the pets before 
profit and csr committee
the pets before profit and csr committee 
meets formally at least twice a year and 
otherwise as may be required 
only committee members have the right 
to attend and vote at its meetings but the 
principal shareholder has a right to appoint 
an observer to attend meetings of the pets 
before profit and csr committee for so long 
as it andor any of its associates when taken 
together holds 10 or more of the voting rights 
in respect of the company’s shares
investment committee
the investment committee assists the 
board with the group’s store and veterinary 
surgery rollout process to ensure the group’s 
investment process is managed effectively 
and rigorously throughout the group the 
investment committee is chaired by nick wood 
and its other members are ian kellett sally 
hopson and the property director a number of 
the group’s colleagues are entitled to attend 
meetings of the investment committee
the investment committee meets formally at 
least ten times a year and otherwise as may be 
required duties of the investment committee 
include reviewing and considering all proposals 
presented for new store and standalone surgery 
acquisitions by a group company approving all 
material variations to proposed new stores and 
standalone surgery acquisitions periodically 
reviewing proposed changes to the reporting 
and presentation of new store investment 
criteria reviewing all proposals presented 
for lease renewals and reviewing alternative 
strategies for new store investment formats 
and geographical markets and reporting on 
such strategies to the board for final approval 
on the terms of any such matter and reviewing 
all proposals for the dispositions of all or part 
of any of the lease on stores including any sub
letting assignments surrenders or relocations 
and approve or reject any such proposals as 
appropriate each of the matters approved 
by the investment committee is subject to 
the further approval of the board where it 
falls within the level expenditure requiring full 
board approval the investment committee 
formally updates the board at least once a 
year in addition to regular updates on matters 
approved within the monthly board packs 
other committees and board meetings
executive management and operating board
in addition to the new board the group has 
both an executive management board as 
detailed in the corporate governance report 
on pages 58 to 59 and operating board the 
“operating board” for which respective roles 
are clearly defined the operating board meets 
frequently to discuss the following
 current trading
 new developments
 operational issues
 marketing
 people
health and safety
health and safety is a key priority for the board 
and senior management and is an item for 
review and discussion at each board meeting 
the board has established a health and safety 
committee which meets at least on a quarterly 
basis and is chaired by the customer people 
and development director with the agenda 
led by the head of health and safety the 
committee is attended by key individuals in the 
business that are responsible for certain areas 
of health and safety including the veterinary 
business and rideaway and the committee 
is tasked with reviewing the group’s overall 
health and safety performance a health and 
safety policy is in place for the group which is 
reviewed on a regular basis 
pets at home group plc
annual report and accounts for the year ended 27th march 2014
74
governance the distribution centres have their own 
dedicated health and safety manager and a 
separate health and safety subcommittee 
which also meets on a regular basis the newly 
integrated veterinary business also has a 
designated health and safety manager 
further details of the work of the health and 
safety committee are contained on page 39 of 
our corporate social responsibility report
risk management and internal control
details of the internal controls of the company 
including a description of the main features 
of its internal control and risk management 
arrangements and the manner in which 
the board and its committees assess the 
effectiveness of these controls are set out in 
the report of the audit committee on page 78
share dealing code
the company has adopted with effect from 
admission a code of securities dealings in 
relation to the shares which is based on and 
is at least as rigorous as the model code as 
published in the lrs the code adopted will 
apply to the directors and other relevant pdmr 
employees of the company
board evaluation and effectiveness
as the board has only been in existence 
for a short period of time an evaluation of 
performance has not been undertaken the first 
full evaluation is scheduled for 2015 and will 
be annual thereafter
relations with shareholders
the board believes it is important to explain 
business developments and financial results to 
the company’s shareholders and to understand 
any shareholder concerns we intend to 
communicate with shareholders on a regular 
basis
as part of the ipo process the company 
met regularly with analysts and institutional 
investors and such meetings will continue 
the chief executive officer and chief financial 
officer have lead responsibility for investor 
relations they are supported by a dedicated 
head of investor relations who amongst other 
matters organises presentations for analysts 
and institutional investors and will also ensure 
that procedures are in place to keep the board 
regularly informed of such investors’ views 
the formal reporting of our full and half yearly 
results will be a combination of presentations 
group calls and onetoone meetings in a 
variety of locations where we have institutional 
shareholders all the nonexecutive directors 
and in particular the chairman and senior 
independent director are available to meet 
with major shareholders if they wish to raise 
issues separately from the arrangements as 
described above the company also plans to 
communicate with shareholders through the 
annual general meeting at which the chairman 
will give an account of the progress of the 
business over the last year and a review of 
current issues and will provide the opportunity 
for shareholders to ask questions 
pets at home’s investor website is also 
regularly updated with news and information 
including this annual report which sets out 
our strategy and performance together with our 
plans for future growth investorspetsathome
com
annual general meeting
the company’s first agm since listing will be 
held on tuesday 9th september 2014 at the 
hilton 303 deansgate manchester m3 4lq 
full details of the meeting are set out in the 
notice of annual general meeting sent with 
this report the agm provides all shareholders 
with the opportunity to attend and vote on the 
resolutions put to shareholders and those 
shareholders unable to attend are encouraged 
to vote using the proxy card enclosed with 
this report or electronically by following the 
instructions set out in the notice of meeting 
whether personally or by proxy information 
relating to votes cast will following the agm  
be available on the company’s website  
investorspetsathomecom
investorspetsathomecom
london stock exchange pets
75
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 report of the  
audit committee
“the directors recognise the 
need to maintain the financial 
reporting procedures review 
them on an ongoing basis 
and adapt them to changing 
circumstances”
amy stirling 
chair of the audit committee
 audit committee
amy stirling chair 
dennis millard 
paul coby 
paul moody
letter from the audit chair
dear shareholder
i am pleased to present the company’s first 
audit and risk committee committee report 
following its admission to the premium listing 
segment of the official list maintained by the 
financial conduct authority and to trading on 
the london stock exchange’s main market for 
listed securities “admission” of the london 
stock exchange on 17th march 2014 due to 
the relatively short time between admission 
and the year end on 27th march 2014 no 
committee meetings took place between these 
two dates following the year end however 
the committee has met on two occasions prior 
to the approval of the financial statements 
as a result this report focuses on the 
matters considered by the committee prior to 
admission the work undertaken to transition 
from the group’s private company status to 
a plc and the focus of the committee going 
forward
leading up to admission the company 
identified the need to strengthen the 
independence of the committee to ensure that 
it complied with the recommendations of the 
uk corporate governance code as a result 
the composition of the committee changed 
on admission and it is now entirely made up 
of independent nonexecutive directors the 
members of the audit and risk committee are 
myself as chair dennis millard paul coby and 
paul moody the board considers that i have 
recent and relevant financial experience 
the committee is a subcommittee of the 
board and its terms of reference were approved 
at the time of the admission and are fully 
aligned to the uk corporate governance code 
the primary function of the committee is to 
assist the board in fulfilling its responsibilities 
to protect the interest of the shareholders 
with regard to the integrity of the financial 
reporting audit risk management and internal 
controls we aim to provide shareholders with 
timely communication on significant matters 
relating to the company’s financial position 
and prospects and we are also responsible for 
monitoring fraud risk 
the committee will meet at least three times 
a year
during the ipo as part of completing the 
group’s financial position prospects and 
procedures report fpp kpmg llp and the 
directors undertook a detailed assessment of 
the following key areas
 board governance including the committee 
and the procedure for assessing the group’s 
key risks
 management accounting process and the 
information provided to the board
 external financial reporting procedures 
and audit arrangements and reporting 
standards
 internal control environment both at high 
and detailed levels
 complex transactions potential exposure 
and risk 
 information systems and
 budgeting and forecasting procedures and 
controls
the directors recognise the need to maintain 
the financial reporting procedures review 
them on an ongoing basis and adapt them 
to changing circumstances their continuous 
review will form part of the committee’s agenda 
going forward together with its wider role and 
responsibilities which are set out in more detail 
on page 77 of the report
i look forward to meeting with shareholders at 
the agm
amy stirling 
chair of the audit committee
11th june 2014
pets at home group plc
annual report and accounts for the year ended 27th march 2014
76
governance admission to the premium listing 
segment of the official list and to trading 
on the london stock exchange
prior to the establishment of the current 
group committee the group had in place a 
committee which was chaired by the group 
chairman tony denunzio and comprised two 
representatives from the principal shareholder 
together with the chief executive officer and 
the chief financial officer the last meeting of 
the previous committee took place on  
28th january 2014 and references to the 
committee in this report include activities both 
before and after listing
membership of the audit and  
risk committee
the committee is chaired by amy stirling 
and its other members are dennis millard 
paul coby and paul moody amy stirling is a 
chartered accountant and until may 2013 
served as the chief financial officer of the 
talk talk telecom group plc amy is also the 
chief financial officer of the prince’s trust the 
directors consider that amy stirling has recent 
and relevant financial experience in accordance 
with the requirements of the uk corporate 
governance code
the chief financial officer the chief executive 
and the group’s head of internal audit 
attend meetings by invitation along with 
representatives from the group’s external 
auditors kpmg together with an observer 
appointed by the principal shareholder
the company secretary acts as secretary  
to the committee 
the committee meets separately with the head 
of internal audit and the external auditors to 
review their reports and discuss issues in 
detail 
role and responsibilities
the committee has received delegated 
authority from the board as set out in its written 
terms of reference which were approved at the 
time of the ipo the principal responsibilities of 
the committee include
 agreeing the scope of the annual audit and 
the annual audit plan and monitoring the 
same
 monitoring making judgements and 
recommendations on the financial reporting 
process and the integrity and clarity of the 
group’s financial statements
 considering the appointment of the group’s 
auditors and their remuneration including 
reviewing and monitoring of independence 
and objectivity and agreeing and monitoring 
the extent of the non audit work that may be 
undertaken 
 reviewing and monitoring the adequacy and 
effectiveness of the internal control and risk 
management policies and systems currently 
in place and
 reporting to the board on how it has 
discharged its responsibilities
audit and risk committee calendar for 
year ended march 2014
the committee will meet at least three times a 
year with any additional meetings being called 
as required two formal committee meetings 
were held pre ipo one on 19th july 2013 to 
present kpmg’s audit findings for the year 
ended march 2013 and the other on  
28th january 2014 to present the audit 
strategy for the year ended 27th march 2014 
however a number of meetings were held with 
kpmg llp throughout the ipo process in their 
capacity as reporting accountants
main activities of the audit and risk 
committee during the year
a key systems project during the year was the 
implementation of some key elements of sap’s 
enterprise resource planning system in may 
2013 covering key financials master data 
pricing and promotions hr business reporting 
and business intelligence ciber were chosen 
as the system integration partner and kpmg 
worked alongside internal audit during the three 
months prior to go live to provide assessment 
and challenge over key project areas kpmg 
llp focused on data migration procedures and 
internal audit focused on system testing and 
business readiness the system went live with 
no issues
during the year the committee reviewed certain 
relevant documentation in relation to the ipo 
notably a detailed review and discussion on 
the detailed findings within the fpp and also 
the audit work carried out in relation to the 40 
week period ended 2nd january 2014 
investorspetsathomecom
london stock exchange pets
77
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 report of the audit committee
continued
further work of the committee in the year 
principally fell under the following main areas
internal controls
 reviewed and considered the reports of the 
head of internal audit on audits completed 
and followup action plans to address areas 
of weakness further details of the areas 
covered are set out on page 80
 received reports from kpmg llp on the 
group’s internal control environment at the 
time of the ipo
 undertook an assessment of the internal 
control environment facilitated by discussion 
with relevant management including a review 
of procedures and processes in place at 
the pets at home vets group following 
acquisition of vets4pets in march 2013
 reviewed a report from the head of internal 
audit on the group’s risk assessment 
process and the way that significant 
business risks are managed and mitigated 
and
 reviewed the company’s arrangements by 
which colleagues may raise concerns in 
confidence as part of a review of the group’s 
antibribery and corruption policy
external auditors
 considered and approved the external 
auditors’ plans for the annual audit of the 
company including the additional reporting 
requirements and accounting implications 
arising from the listing 
 approved the fees of the external audit 
and reviewed the company’s policy on the 
engagement of the external auditors to 
supply nonaudit services 
 reviewed the reports and findings of the 
external audit and
 reviewed the effectiveness and 
recommending the reappointment of the 
external auditors
accounting tax and financial reporting
 reviewed the appropriateness of the annual 
and the financial statements for the 40 
week period ended 2nd january 2014 with a 
focus on amongst other matters the quality 
and acceptability of accounting policies and 
procedures material areas where significant 
judgements have been applied or there 
has been a significant discussion with the 
group’s external auditors and the clarity of 
disclosures and compliance with financial 
reporting standards and
 considered and approved the group’s tax 
policy which covers the group’s approach on 
the group’s key tax principles the group’s 
attitude to tax and risk our relationship 
with hmrc the various individuals in the 
organisation who input into the various tax 
processes our relationships with external 
tax advisers a summary of our processes 
for assessing and providing for tax exposure 
where appropriate and making payments 
when due
main activities of the audit and risk 
committee post yearend
in june 2014 the committee had two further 
meetings which covered the following
 reviewed whether the annual report and 
accounts taken as a whole is fair balanced 
and understandable and provides the 
information necessary for shareholders to 
assess the company’s strategy business 
model and performance
 reviewed the reports and findings of the 
external auditors
 reviewed the effectiveness and 
recommended the reappointment of the 
external auditors and
 considered the risk assessment mitigation 
actions and assurance activities produced 
by management
key areas of audit focus 
following discussion with the executive 
directors key members of the management 
team and the external auditors the committee 
have agreed with kpmg that the key audit focus 
areas are
 stock valuation and
 financial statements – accounting for the 
ipo and enhanced plc disclosures
the corporate structure in place prior to the 
ipo on 17th march 2014 was complex in nature 
and structured to meet the needs of the group 
and its shareholder base pre ipo the group 
engaged appropriate legal accounting and tax 
advisers to develop a steps plan to facilitate 
a group structure commensurate with its new 
status on the premium list of the london stock 
exchange the group engaged advisers who 
had been involved in the establishment of the 
structure at inception and who had maintained 
a close involvement with the group and the 
structure’s evolution through to ipo the steps 
developed included a detailed articulation of 
the accounting treatment necessary both pre 
and post the ipo and we have worked closely 
with our advisers to ensure the accounting 
entries necessary have been executed correctly 
subsequent to the ipo we have considered 
at length the appropriate presentation of our 
first ipo results as a plc the key area of 
technical consideration was the application of 
the principles of reverse acquisition accounting 
to the group and the technical requirement 
to consolidate three companies from the 
old group structure which were immediately 
liquidated following ipo 
the group has deployed additional technical 
accounting resource to ensure appropriate peer 
to peer internal review of our ipo accounting 
this additional resource has ensured we have 
been able to adequately deal with increased 
reporting requirements and disclosures 
commensurate with delivering our first plc 
accounts under ifrs having worked closely with 
our external auditors to ensure we are compliant
pets at home group plc
annual report and accounts for the year ended 27th march 2014
78
governance stock valuation
the group has a number of formal processes 
and controls to ensure that the value of stock 
presented in the annual report accurately 
reflects the stock on hand and that it is 
properly valued at the lower of cost or net 
realisable value the business continually 
counts stock both instore and in the 
distribution centres and the frequency of 
each department count is based on a risk 
assessment which is reviewed on an ongoing 
basis the business has processes in place 
to manage the risk from out of date stock and 
the finance team and supply team meet weekly 
to discuss in detail the stock file and to agree 
actions to ensure slow moving lines are cleared 
and our overall stock investment is optimised 
such that our working capital targets are 
delivered an inherent element of the process 
to introduce new ranges into the business is a 
clear focus on the clean and timely exit of any 
discontinued lines our provisioning process 
is undertaken on a product by product basis 
and reflects the current understanding of the 
finance and supply teams as regards the likely 
realisations for stock with significant forward 
cover of stock that has been designated 
discontinued our provision also reflects based 
on historical count history the likely stock loss 
between the last count of a specific department 
and the balance sheet date
risk management and internal controls
the board has overall responsibility for risk 
management and the system of internal control 
and for reviewing their effectiveness 
risk management responsibilities are allocated as follows
executive board collectively responsible for managing risk
 key risks are allocated an executive board member for oversight and ultimate ownership
 the full executive management board supported by key members of the operating board are responsible for closely 
managing the most significant risks
 receives regular risk updates and reports
operating board has line responsibility for managing risks within their areas
 reviews risk registers periodically three times a year
 takes action as agreed and documented in the risk registers
 identifies new risks for inclusion in the registers
audit committee oversees the risk management process
 receives and reviews detailed risk reports prepared on a department by department basis twice a year
 chairman completes a detailed review of the risk reports
internal audit coordinates the risk management processes
 holds meetings with all risk owners across the business three times a year
 updates the individual risk registers including actions and progress made assesses risk ratings and determines if 
these should change up or down and documents the controls in place that help mitigate each risk
health and safety 
committee
assists the board in managing the risk of health safety and security
 holds meetings quarterly with stakeholders from across the group
 reviews the group’s risk register health and safety policy and compliance with applicable regulations
 recommends to the board and group appropriate policies and procedures
 updates the board on accidents across the group
79
investorspetsathomecom
london stock exchange pets
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 report of the audit committee
continued
internal control
the board is responsible for the group’s 
system of internal control and for reviewing its 
effectiveness the board delegates to executive 
management the responsibility for designing 
operating and monitoring these systems the 
systems are based on a process of identifying 
evaluating and managing key risks and include 
the risk management processes set out above
the systems of internal control were in place 
throughout the period and up to the date of 
approval of the annual report the systems of 
internal control are designed to manage rather 
than eliminate the risk of failure to achieve 
business objectives they can only provide 
reasonable and not absolute assurance against 
material errors losses fraud or breaches of 
law and regulations the group operates a 
number of internal controls across its business 
the key controls the business relies upon are 
set out below
  an annual groupwide strategic review of  the 
business culminating in the preparation of 
a detailed three year strategic plan which 
is reviewed and approved by the board 
immediately following this approval the 
business undertakes its annual budget 
cycle again culminating in a formal review 
and approval by the board
 review of period end management accounts 
with comparison of actual performance 
against budget consideration of the outturn 
for the year and management accounts are 
reviewed at board meetings by the board 
the period end accounts are prepared by the 
management accounts team and reviewed 
by the chief financial officer and the 
finance director
 approval by the chief financial officer is 
required for all capital investments an 
authority framework is in place which details 
the approvals required at specific levels 
of capital spend including those capital 
projects requiring full board approval the 
board has delegated certain powers in 
respect of the acquisition and fitout of 
new stores and new standalone veterinary 
practices to an investment committee 
chaired by the ceo see page 74 for further 
details
 there is an internal audit department in 
place which has its scope agreed with the 
audit committee and which reports formally 
twice a year on specific issues all internal 
audit reports are presented to the audit 
committee for review and consideration of 
any material findings
 a clearly articulated delegated authority 
framework in respect of all purchasing 
activity is in place across the group this is 
complemented by systemic controls which 
reflect the agreed authority framework
 a clear segregation of duties between 
relevant functions and departments
 a schedule of matters reserved for 
the board is in place for approving 
significant transactions and strategic and 
organisational change
internal audit 
the internal audit function was formally 
established in january 2013 and comprises 
one fulltime colleague head of internal audit 
and risk whose activities have been assisted 
where necessary with appropriate external 
resource the head of internal audit and risk 
has a direct reporting line to the chairman of 
the audit committee but on a daytoday basis 
reports to the cfo
the internal audit department has an annual 
plan in place covering the key areas to be 
reviewed in the financial year the plan is 
prioritised according to the risk register and 
areas are covered in priority order the plan has 
been reviewed and approved both by the board 
and the committee and this will be done on an 
annual basis going forward 
201314 plan
the internal audit plan for 201314 included 
pet welfare the launch of the new pets at home 
multichannel website the sap implementation 
business continuity plans the deployment of 
the new warehouse system jda a recovery 
audit of accounts payable accounts for the vets 
group and pets at home and a quality audit for 
uk and hong kong sourcing office
during fy14 three internal audit reports have 
been issued covering pet welfare the launch of 
the pets at home multichannel website and the 
implementation of sap 
pets at home group plc
annual report and accounts for the year ended 27th march 2014
80
governance recommendations from internal audit are 
prioritised based on risk the three reports 
issued to date included a number of priority 
findings for management attention and these 
have been actioned
the focus to date of internal audit has been 
operational matters aligned to the risk 
assessment of the business by the board 
internal audit resources will be increased in 
the forthcoming year to ensure the scope of 
internal audit is extended such that the internal 
audit programme in the areas of finance and 
systems are commensurate with best practice 
for a business of our size with our risk profile
looking forward
following listing the board plans to undertake 
an external review of internal audit function 
once the committee has had the opportunity 
to identify the scope we wish to adopt for the 
group whilst ensuring the necessary resource 
is made available to deliver the agreed 
plan the external review is expected to be 
completed by march 2015 representing the 
time the department has been in operation for 
two full financial years
external audit
the group’s external auditors are kpmg llp 
and they have been the group’s auditors since 
the period ended 30th march 2000
in each year an unqualified audit opinion has 
been given
the committee oversees the appointment 
and termination of the external auditors and 
ensures there is sufficient independence in 
place in regards to the audit and nonaudit fees 
taken by kpmg llp 
representatives from kpmg llp are invited to 
the committee to report the findings of their  
annual audit
the board is aware of the regulatory proposals 
that would require a compulsory tender of the 
statutory audit the last tender of the audit 
service was performed in 2000 when kpmg 
llp were appointed and therefore under the 
frc guidelines the tender process might be 
deferred until five years after the expiry of the 
current engagement partner’s tenure however 
the matter will be considered by the committee 
in the forthcoming year
81
investorspetsathomecom
london stock exchange pets
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration 
report
“our policy recognises the 
importance of attracting and 
retaining highquality talent  
our culture is underpinned by 
an engaged colleague base 
who are at the heart of  
our success”
dennis millard 
chairman of the remuneration committee
 remuneration committee
dennis millard chair 
tessa green 
amy stirling 
paul moody
statement from the remuneration 
committee chairman
dear shareholder
i am pleased to present our remuneration 
report for the financial year ended 27th march 
2014 which has been prepared in compliance 
with the new uk reporting regulations
this report consists of two sections
 policy report — this sets out the directors’ 
remuneration policy for all directors of 
pets at home group plc and will be subject 
to a binding shareholder vote at our 2014 
annual general meeting agm and
 annual report on remuneration — this 
sets out details of how our directors were 
paid during fy14 and how the policy will be 
applied in fy15 this will be subject to an 
advisory shareholder vote at our 2014 agm
context to the committee decisions 
the shares of pets at home group plc were 
admitted to the premium listing segment of the 
official list maintained by the financial conduct 
authority and to trading on the london stock 
exchange’s main market for listed securities 
“admission” shortly before the fy14 year 
end prior to the ipo we undertook a detailed 
review of our remuneration framework to ensure 
that post admission it was aligned with best 
practice whilst at the same time preserving the 
core values of our business
our policy recognises the importance of 
attracting and retaining highquality talent our 
culture is underpinned by an engaged colleague 
base who are at the heart of our success we 
know that engaged colleagues stay with us for 
longer and this supports our business model 
creating higher customer advocacy and driving 
increased spend over the year
 colleague retention was 81
 colleague engagement was 93
 pets at home won the sunday times ‘25 
best big companies to work for’ award
the transition of pets at home group plc to a 
listed company has enabled us to broaden our 
colleague share ownership through
 a oneoff colleague share offer that enabled 
all colleagues to purchase shares directly in 
the ipo with over 2700 colleagues deciding 
to participate in the investment opportunity 
and
 the grant on admission of awards under 
discretionary share plans with over 800 
participants
we intend to ensure that widespread share 
ownership remains an integral part of our 
culture and will be adopting an allcolleague 
sharesave plan later this year alongside the 
above discretional plans 
fy 2015 pay structure 
as part of the pre ipo review the ceo’s and 
cfo’s remuneration packages have been 
rebalanced to bring them more in line with 
typical listed practice this resulted in an 
increase to their salary and bonus opportunity 
positioning them in line but not above levels in 
the broader retail sector
post admission we also implemented two 
longterm incentive plans for senior executives 
including the executive directors
 coinvestment plan cip
 performance share plan psp
coinvestment plan
the remuneration committee recognises the 
need to sustain the longterm success of pets 
at home by retaining key executives beyond 
the ipo many of whom now have significant 
shareholdings as a result we adopted a co
investment plan cip on admission which is 
a oneoff arrangement tailored to our postipo 
position the cip will create incentive and 
lock in and also align interests with those of 
shareholders 
pets at home group plc
annual report and accounts for the year ended 27th march 2014
82
governance the cip required executive directors to make 
and retain a significant personal investment in 
return for a matching award subject to achieving 
stretching performance conditions it is a one
off arrangement and current executive directors 
will receive no further awards under the plan
the cip has been designed as a tool to both 
incentivise and retain the existing team by the 
inclusion of a penalty through the forfeiture of 
invested shares in the event the executives 
resign from the employment of the group within 
two years of listing
performance share plan
the performance share plan will be our 
ongoing longterm incentive plan due to their 
participation in the cip  the intention is for 
executive directors to receive their first award 
under the psp in 2016
fy14 performance and  
remuneration outcomes 
highlights of the group’s financial and 
operational highlights include
financial highlights
 revenues grew 112 to £6654m 
reflecting store portfolio expansion and 
strength across food accessories and 
services
 likeforlike sales growth of 24 driven 
by vip club success strength in advanced 
nutrition omnichannel and the growing 
maturity of groom rooms and vet practices
 likeforlike growth in revenues generated 
within the joint venture veterinary practices 
of 140 underpinning fee income growth
 underlying ebitda margin expansion of 
17bps to 166 reflecting the leverage from 
our services business which represents 
76 of group revenues fy13 53 
operational highlights
 now the largest vet services provider in uk 
with 277 practices reflective of 47 instore 
openings and 22 standalone openings 
during the year 
 32 new pets at home stores opened during 
the year including the new highend dog 
focused high street format barkers 
 largest number of groom rooms ever 
opened in a single year 42 new salons were 
opened bringing the portfolio to 129 salons
annual bonus payments in  
respect of fy14 performance
on the basis of pets at home’s financial 
performance and also taking into account 
individual performance against objectives 
set by the pre ipo remuneration committee 
the remuneration committee agreed bonus 
payments
shareholder engagement
we value all feedback from shareholders and 
as a public company we intend to engage with 
our investors on a regular basis we hope to 
receive your support for our policy report and 
our annual report on remuneration at our agm 
on 9th september 2014
dennis millard 
chairman of the remuneration committee
11th june 2014
investorspetsathomecom
london stock exchange pets
83
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
remuneration policy
a policy report
the following section on pages 84 to 97 sets out our directors’ remuneration policy in accordance with section 439a of the companies act 2006 
this policy will be put forward for shareholder approval at our agm on 9th september 2014 and will apply from that date it is currently intended that 
the policy will apply for three years
overall remuneration is structured and set at levels to enable the recruitment and retention of high calibre executives and encourage them to enhance 
the company’s performance in a responsible manner in line with the business’s strategy and shareholders’ interests
a significant portion of the package is performance related remuneration has been set taking into account practice within the ftse 250 and practice 
at other retail companies
purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
fixed elements — base salary
core element of 
remuneration 
recognising the role 
and responsibilities 
of the role
 paid in cash and are pensionable
 the committee takes into consideration a number of  
factors when setting salaries including but not limited to
 — size and scope of the individual’s responsibilities
 — the individual’s skills experience and performance
 — typical salary levels for comparable roles within  
appropriate pay comparators including practice for  
retail companies and the broader ftse 250 and
 — pay and conditions elsewhere in the group
 in fy15 basic salaries will be reviewed at the june 
remuneration committee meeting and subsequent reviews 
will take place annually at the march remuneration 
committee meeting any change will usually be effective 
from the first period in the following financial year
 whilst there is no maximum salary level any increases 
will normally be broadly in line with the wider colleague 
population within the relevant geographic area
 higher increases may be made under certain 
circumstances at the committee’s discretion for example 
this may include
 — increase in the scope andor responsibility of the 
individual’s role and
 — development of the individual within the role
 annual base salaries for the executive directors are set out 
in part 3a of this report
pets at home group plc
annual report and accounts for the year ended 27th march 2014
84
governance purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
fixed elements — benefits
to provide 
colleagues with 
market competitive 
benefits
 the company provides a range of benefits which may 
include
 — a company car or cash equivalent
 — life assurance
 — permanent health insurance
 — private medical insurance
 these benefits are not pensionable
 other benefits may be considered by the committee  
if considered appropriate
 the company may also meet certain mobility costs such 
as relocation support expatriate allowances temporary 
living and transportation expenses in line with the 
prevailing mobility policy and practice for other senior 
executives
 executive directors are eligible to participate in any 
taxapproved allcolleague share plans operated by the 
company on the same basis as other eligible colleagues 
whilst it does not currently operate such a plan the 
company intends to introduce a sharesave scheme during 
the term of this policy
 the cost to the company of providing other benefits may 
vary depending on for example market practice and the 
cost of insuring certain benefits
 the committee keeps the level of benefit provision under 
regular review
 details of current benefit provision for the executive 
directors are set out in part 3a of this report
fixed elements — pensions
to provide 
colleagues with 
an allowance for 
retirement planning
 pension contributions are made to either the group  
pension plan to personal pension schemes or cash 
allowances in lieu of contributions are paid
 the contribution level for an individual executive director 
is capped at 9 of base salary per annum for employer 
contributions
 details of current pension provision for the executive 
directors are set out in part 3a of this report
investorspetsathomecom
london stock exchange pets
85
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
shortterm elements — annual bonus
to incentivise the 
delivery of our 
business plan on an 
annual basis
to reward 
performance against 
key performance 
indicators which 
are critical to the 
delivery of our 
business strategy
 delivery will normally be in cash and is not pensionable
 performance measures are set annually and payout levels 
are determined by the committee after the year end based 
on performance against those targets during the relevant 
financial year
 each year the committee determines the measures and 
weightings within the following parameters
 — at least 75 of the annual bonus will be based on 
financial performance measures and
 — no more than 25 of the annual bonus will be based on 
performance against nonfinancial measures including 
for example individual and strategic objectives
 the committee ensures that targets are appropriately 
stretching in the context of the business plan and that 
there is an appropriate balance between incentivising 
executive directors to meet financial targets for the year 
and to deliver specific nonfinancial goals this balance 
allows the committee to effectively reward performance 
against the key elements of our strategy
 the company may amend the performance measures or 
targets in exceptional circumstances where it considers 
that they are no longer appropriate
 there is no provision for recovery
 the maximum bonus opportunity is 100 of base salary
 20 is payable for threshold performance
pets at home group plc
annual report and accounts for the year ended 27th march 2014
86
governance longterm incentives — overview
at the time of ipo the committee wished to put in place longterm incentive arrangements which would provide for the continued alignment of 
executive directors with our shareholders as such the committee approved three longterm incentive plans the coinvestment plan cip the 
performance share plan psp and the company share option plan csop
 cip — a oneoff arrangement tailored to our postipo position it requires executive directors to make a significant personal investment in order 
to be eligible to receive a company match providing that stretching performance conditions are reached awards were made on ipo and there is no 
intention to make any further awards to current executive directors under the plan
 psp — intended to be our regular ongoing longterm incentive plan in future years given that executive directors were made awards under the cip 
in 2014 there is no intention for current executive directors to receive awards under the psp until 2016
 csop — for executive directors this plan is used to allow the company and participant to benefit from hmrcapproved option tax treatment in 
respect of the initial part of a psp award currently up to £30000 as such in line with the psp above it is not intended for current executive 
directors to receive awards under the csop until 2016
in addition the committee intends to introduce a sharesave plan during the term of this policy in which all colleagues will be eligible to participate 
including executive directors
although we do not intend to make any further awards under the cip to current executive directors following ipo we have provided details of the plan 
in the policy table below for clarity no individual will be eligible to receive two awards under the cip  the committee may consider granting a new 
executive director a cip award if it considers it to be appropriate to promote alignment across the executive team
purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
longterm elements — coinvestment plan cip
1
to promote continued 
alignment between 
executive directors and 
shareholders in the years 
following ipo
current executive 
directors will not receive 
any further awards under 
the cip
 matching awards vest after three four and five years 
subject to achievement of performance conditions
 additional shares or cash may be awarded in lieu of 
dividends on any matching awards which vest which 
would have been paid during the vesting period
 the performance measures under the cip are
 — 75 eps growth — to reflect the financial 
performance of our business and a direct and 
focused measure of company success
 — 10 of the total marching award will vest for eps 
growth of 10 per annum rising to 75 of the total 
matching award will vest for eps growth of 175  
per annum
 — 25 relative tsr against the uk general retail 
index — a measure of the ultimate delivery of 
shareholder returns promoting alignment between 
executive director remuneration and the shareholder 
experience
 — 625 of the total marching award will vest for 
median tsr performance against the index and 
25 of the total matching award will vest for upper 
quartile tsr performance against the index
 executive directors invested 250 of base salary in the 
cip at ipo invested shares
 subject to performance invested shares may be 
eligible for up to a 11 company match on this amount 
matching award
1 the committee may in the event of any variation of the company’s share capital demerger delisting or other event which may affect the value of awards adjust or amend the terms of awards in 
accordance with the rules of the relevant share plan in the case of the saye any changes may be subject to hmrc approval if required
investorspetsathomecom
london stock exchange pets
87
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
 the committee considers that the performance 
measures are fully aligned with our corporate strategy 
the committee has set the targets to be appropriately 
stretching with regard to a number of internal and 
external reference points and considers that delivery  
of these targets should create sustainable value for 
shareholders
 the plan rules also stipulate that the committee 
may amend the performance measures or targets in 
exceptional circumstances where it considers that  
they are no longer appropriate if this discretion was 
used we would consult with our major shareholders 
and the rationale would be clearly explained in the 
remuneration report
 unvested and unexercised awards are subject to  
malus in case of misconduct or misstatement
 invested shares may also be forfeited in case of fraud 
misconduct or negligence
 under the terms of the cip  the treatment of leavers  
depends on the length of the period between grant  
and cessation with invested shares being forfeited in 
the event of early leavers see page 94 for  
further details
pets at home group plc
annual report and accounts for the year ended 27th march 2014
88
governance purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
longterm elements — performance share plan psp
1
to incentivise the delivery 
of our business plan on an 
annual basis
to reward performance 
against key performance 
indicators which are 
critical to the delivery of 
our business strategy
the intention is that 
current executive directors 
will not receive awards 
under the psp until 2016
 awards vest after three years subject to achievement  
of performance conditions
 additional shares or cash may be awarded in lieu of 
dividends on any shares which vest which would have 
been paid during the vesting period
 share awards are normally made in the form of 
conditional share awards but may be awarded in  
other forms if appropriate such as nil cost options  
the plan rules specify that awards may also be  
satisfied in cash although this is unlikely to apply  
to directors 
 the ultimate goal of the company’s strategy is to 
provide longterm sustainable returns to shareholders 
the committee strives to do this by aligning the 
performance measures under the psp with the  
longterm strategy of the company and considers  
that strong performance under the chosen measures  
should result in sustainable value creation
 — financial measure — to reflect the financial  
performance of our business and a direct and 
focused measure of company success the 
committee sets targets to be appropriately 
stretching with regard to a number of internal and 
external reference points
 — share price performance measure – a measure of 
the ultimate delivery of shareholder returns this 
promotes alignment between executive director 
reward and the shareholder experience targets 
are set with reference to wider market practice and 
positioned at a level which the committee considers 
represents stretching performance
 the committee sets targets each year achievement 
of which it considers would represent stretching 
performance in the context of the business plan
 normally the weighting would be split equally across 
these two measures although the committee may  
vary this as appropriate to reflect strategic priorities
 the maximum award opportunity under the psp is 
normally 150 of base salary or 200 of salary in 
circumstances which the committee considers to be 
exceptional
1 the committee may in the event of any variation of the company’s share capital demerger delisting or other event which may affect the value of awards adjust or amend the terms of awards in 
accordance with the rules of the relevant share plan in the case of the saye any changes may be subject to hmrc approval if required
investorspetsathomecom
london stock exchange pets
89
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 94 remuneration report
continued
purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
 for ‘threshold’ levels of performance 25 of the 
maximum award vests increasing to 100 of the  
award for maximum performance
 the plan rules also stipulate that the committee 
may amend the performance measures or targets in 
exceptional circumstances where it considers that  
they are no longer appropriate if this discretion was 
used we would consult with our major shareholders 
and the rationale would be clearly explained in the 
remuneration report
 unvested and unexercised awards are subject to malus  
in case of misconduct or misstatement
 the committee may at its discretion structure awards 
as approved company share option plan csop 
awards csop awards enable the participant and 
company to benefit from hmrc approved option tax 
treatment in respect of part of the award without 
increasing the pretax value delivered to participants 
csop awards may be structured either as an approved 
option for the part of the award up to the hmrc limit 
currently £30000 with an unapproved option for the 
balance and a ‘linked award’ to fund the exercise price 
of the approved option or as an approved option and 
a psp award with the vesting of the psp award scaled 
back to take account of any gain made on exercise of 
the approved option
saye
1
an allcolleague plan 
which encourages long
term shareholding and 
to align the interests 
of uk colleagues with 
shareholders
executive directors are 
eligible to participate
 saye is an hmrcapproved scheme where eligible 
colleagues are granted savingsrelated share options 
to subscribe for ordinary shares in the company it is 
intended that the plan will be implemented during 2014
 options are granted to be exercisable in conjunction 
with either a threeyear or fiveyear savings contract  
with a monthly savings limit of £500
 options are normally granted at a discount of 20 to 
market price at the time of invitation 
 there are no performance measures attached to  
awards under the saye
  the market value of the shares under option at the date 
of maturity of the sharesave savings contract less the 
grant price of the option at the contract start date
1 the committee may in the event of any variation of the company’s share capital demerger delisting or other event which may affect the value of awards adjust or amend the terms of awards in 
accordance with the rules of the relevant share plan in the case of the saye any changes may be subject to hmrc approval if required
pets at home group plc
annual report and accounts for the year ended 27th march 2014
90
governance b chairman and nonexecutive director remuneration policy
purpose and link to 
strategy
operation and performance 
measurement
maximum 
opportunity
overall remuneration
to attract and retain high 
calibre individuals by 
offering market competitive 
fee arrangements
 nonexecutive directors receive a basic fee in respect  
of their board duties
 further fees are paid to nonexecutive directors in 
respect of deputy chairman of the board andor 
chairmanship of board committees
 the nonexecutive chairman receives an allinclusive  
fee for the role
 the remuneration of the nonexecutive chairman is set 
by the remuneration committee whilst the board as 
a whole is responsible for determining nonexecutive 
director fees these fees are the sole element of non
executive remuneration and they are not eligible for 
incentive awards pensions or other benefits
 fees are typically reviewed annually
 expenses incurred in the performance of nonexecutive 
duties for the company may be reimbursed or paid for 
directly by the company as appropriate including any 
tax due on the benefits
 current fee levels can be found on page 102
 fees are set at a level which is considered appropriate 
to attract and retain the calibre of individual required by 
the company
 the company’s articles of association provide that the 
total aggregate remuneration paid to the nonexecutive 
chairman and the neds will be within the limits set by 
shareholders
legacy matters
the committee will honour remuneration related commitments to current and former executive directors including the exercise of any discretions 
available to the committee in relation to such commitments where the terms were agreed prior to the approval and implementation of the 
remuneration policy detailed in this report provided that in the opinion of the committee the payment was not in consideration for the individual 
becoming an executive director of the company
for these purposes payments include the committee satisfying awards of variable remuneration and in relation to an award over shares the terms of 
the payment are agreed at the time the award is granted
remuneration arrangements throughout the company
the remuneration policy for our executive directors is designed in line with the remuneration philosophy and principles that underpin remuneration for 
the wider company
all our reward arrangements are built around the common objectives and principles outlined below
 performance driven — the company intentionally places significant focus on variable remuneration ensuring that a meaningful proportion of 
remuneration is based on performance performance targets are typically aligned with those of the executive directors as a result individuals are 
incentivised towards consistent financial and nonfinancial business goals and objectives in addition to appropriate individual goals
 colleagues as shareholders — the committee intends to put in place a sharesave plan during the term of this policy to allow our wider colleague 
population to build up a shareholding in the company in addition under the terms of our ipo colleagues were permitted to buy shares on listing 
and over 2700 colleagues took up this opportunity
investorspetsathomecom
london stock exchange pets
91
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
c recruitment policy
the following table sets out the various components which would be considered for inclusion in the remuneration package for the appointment of an 
executive director and the approach to be adopted by the committee in respect of each component
element policy and operation
overall
 the committee’s approach when considering the overall remuneration arrangements in the recruitment of a member 
of the board from an external party is to take account of the executive director’s remuneration package in their 
prior role the market positioning of the remuneration package and to not pay more than necessary to facilitate the 
recruitment of the individual
 where an executive director is appointed from within the business in addition to considering the matters detailed 
above for external candidates the normal policy of the company is that any legacy arrangements would be honoured 
in line with the original terms and conditions
fixed elements
base salary benefits and 
other benefits
 we recognize that salary levels drive other elements of the package and would therefore seek to pay a salary which 
is competitive but no more than necessary to secure the individual
 the executive director would be eligible to participate in our benefit and pension plans including coverage under all 
executive director and colleague pension and benefit programmes in accordance with the terms and conditions of 
such plans as may be amended by the company from time to time
 the company may meet certain mobility costs including relocation support expatriate allowances temporary living 
and transportation expenses in line with the prevailing mobility policy and practice for senior executives
shortterm incentives
 the individual will be eligible to participate in the annual bonus plan in accordance with the rules and terms of the 
plan in operation at the time
	 the	maximum	le vel	of	oppor tunity	will	be	no	greater	than	that	set	out	in	the	p olicy	t able	abo ve	ie	••	of	base	
salary
longterm incentives
 the individual will be eligible to participate in the performance share plan and the associated company share 
option plan in accordance with the rules and terms of the plan in operation at the time the maximum level of 
opportunity will be no greater than that set out in the policy table above ie 200 of base salary
 alternatively whilst not currently envisaged at this time the committee may consider the individual eligible to 
participate in the coinvestment plan which would operate under the same terms as for current participants the 
maximum level of opportunity will be no greater than that set out in the policy table above ie a maximum matching 
award of 250 of base salary and would be prorated to reflect the length of the performance period which the 
individual was due to serve
pets at home group plc
annual report and accounts for the year ended 27th march 2014
92
governance element policy and operation
buyout awards
 the committee will consider what buyout awards if any are reasonably necessary to facilitate the recruitment of a 
new executive director in all circumstances this includes an assessment of the awards which would be forfeited on 
leaving their current employer
 the committee will seek to structure any buyout awards such that overall they are no more generous in terms of 
quantum or vesting period than the awards due to be forfeited
 in determining the quantum and structure of these commitments the committee will seek to provide broadly 
equivalent value and replicate as far as practicable the timing and performance requirements of the awards 
forfeited
 buyout awards if used will be granted using the company’s existing longterm incentive plans to the extent possible 
although awards may also be granted outside of this plan if necessary and as permitted under the listing rules
 in the case of an internal hire any outstanding awards made in relation to the previous role will be allowed to pay out 
according to their original terms
 if promotion is part way through the year an additional topup award may be made to bring the executive director’s 
opportunity to a level that is appropriate in the circumstances
d service contracts and loss of office arrangements
the committee’s policy on service contracts and termination arrangements for executive directors is set out below on principle it is the committee’s 
policy that there should be no element of reward for failure the committee’s approach when considering payments in the event of a loss of office 
is to take account of the individual circumstances including the reason for the loss of office company and individual performance contractual 
obligations of both parties as well as share plan and pension scheme rules
the key employment terms and conditions of the current executive directors as stipulated in their service contracts are set out below
area policy
notice period
 the service contracts for nick wood and ian kellett provide for a notice period from both the company and the individual 
of 12 months for nick wood and six months for ian kellett
 new executive directors will be appointed on service contracts that have a notice period of not more than 12 months for 
both the company and the individual
 the committee considers this policy provides an appropriate balance between the need to retain the services of key 
individuals for the benefit of the business and the need to limit the potential liabilities of the company in the event of 
termination
contractual payments
 executive directors’ service contracts allow for termination with contractual notice from the company or termination by 
way of payment in lieu of notice pilon at the company’s discretion payment in lieu of notice would be made where 
circumstances dictate that the executive directors’ services are not required for their full notice period
 neither notice nor pilon will be given in the event of gross misconduct
 payment in lieu of notice will be limited to base salary and contractual benefits for the relevant notice period
 there is no contractual entitlement to a payment under the annual bonus in respect of the notice period 
 service contracts allow for mitigation if the individual finds alternative employment
investorspetsathomecom
london stock exchange pets
93
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
area policy
shortterm incentives
 the committee’s policy is not to award an annual incentive for any portion of the notice period not served
 where an executive director leaves office after the end of a performance year but before the payment is made the 
executive will remain eligible for an annual bonus for that performance year subject to the normal assessment of 
performance achieved over the period
 where an executive director leaves office during a performance year any bonus would be at the committee’s absolute 
discretion and would take into account performance and the time served during the period
 no bonus will be paid in the event of gross misconduct
longterm incentives
 the treatment of unvested longterm incentive awards is governed by the rules of the relevant incentive plan
cip
treatment under the cip is dependent on the period elapsed since the ipo
a within the first 24 months following admission
 where an individual with a six month notice period voluntarily resigns less than 18 months following the date of 
admission they will forfeit their invested shares and their matching awards
b between 24 months and 36 months following admission
 where an individual with a six month notice period voluntarily resigns between 18 months and 30 months following the 
date of admission and completes at least two years’ service by working his notice period or being put on garden leave or 
would have done so but is given pilon they will retain their invested shares and may retain a portion of their matching 
award subject to achievement of performance targets measured over the first two years of the performance period
c on or after 36 months following admission
 where an individual with a six month notice period voluntarily resigns on or after 30 months following the date of 
admission and completes at least three years’ service by working his notice period or being put on garden leave or 
would have done so but is given pilon they will retain their invested shares and if a good leaver defined as under the 
psp also their matching award unless the committee determines otherwise 
any participant who is dismissed for reasons of fraud or negligence will forfeit their invested shares and matching  
awards in full
psp
 under the psp  the default position is for unvested awards to lapse upon a loss of office event
 where an individual is determined to be a ‘good’ leaver which include for reasons of death illness injury disability 
retirement or any other reason at the discretion of the committee the committee may allow unvested awards to subsist 
until the relevant vesting date subject to satisfaction of the performance conditions and prorated for time served
 alternatively the committee may at its discretion allow awards to vest at an earlier date having regard to the 
achievement of performance conditions to that date and the period of time that has passed since the date of grant the 
committee may choose to apply no reduction in the amount vesting if it is considered appropriate given the particular 
circumstances
pets at home group plc
annual report and accounts for the year ended 27th march 2014
94
governance area policy
change in control
 the committee’s policy is that service contracts should not provide for additional compensation on severance as a result 
of a change in control
 under the psp  the committee will determine whether and to what extent awards shall vest taking into account all relevant 
factors including company performance the period of time elapsed since the date of grant and the interests of our 
shareholders
 under the cip  participants will be eligible to retain their full invested shares and all restrictions on them will be lifted 
the committee will determine whether and to what extent matching awards shall vest taking into account company 
performance and the period of time elapsed since the date of grant
external appointments
executive directors are permitted to hold an external appointment with the prior consent of the board any fees may be retained by the individual
chairman and nonexecutive directors
the nonexecutive directors including the chairman of the board have letters of appointment which set out their duties and responsibilities they do 
not have service contracts
the key terms of the appointments are set out in the table below
provision policy
period
 initially appointed for a period of three years subject to annual review and notice
 in line with the uk corporate governance code all directors will seek annual reappointment by shareholders at the agm
loss of office
 three months’ notice by either the company or the nonexecutive director
 nonexecutive directors and the chairman of the board are not entitled to compensation on leaving the board
fees
 as set out on page 102
expiry of current term see page 99 for details of the expiry of the current term of nonexecutive directors’ letters of appointment
availability of documentation
service contracts and letters of appointment for all directors are available for inspection by any person at our registered office in handforth cheshire 
they will also be available for inspection during the 30 minutes prior to the start of our agm to be held in manchester on 9th september 2014
e illustration of the remuneration policy
our remuneration arrangements have been designed to ensure that a significant proportion of pay is dependent on the delivery of stretching 
shortterm and longterm performance targets aligned with the creation of sustainable shareholder value the committee considers the level of 
remuneration that may be received under different performance outcomes to ensure that this is appropriate in the context of the performance 
delivered and the value added for shareholders
investorspetsathomecom
london stock exchange pets
95
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
the charts below provide illustrative values of the remuneration package for executive directors under three assumed performance scenarios 
scenario assumptions
fixed pay
all performance scenarios
 consists of total fixed pay including base salary benefits and pension
 base salary — salary effective as at 17th march 2014
 benefits — amount estimated to be received by each executive director in 201415
 pension — salary supplement effective as at 17th march 2014
minimum performance
 no payout under the annual bonus
 no vesting under the performance share plan
variable pay
ontarget performance
 50 of the maximum payout under the annual bonus ie 50 of salary
 16 vesting under the performance share plan ie 24 of salary
maximum performance
 100 of the maximum payout under the annual bonus ie 100 of salary
 100 vesting under the performance share plan ie 150 of salary
notes
the coinvestment plan has not been included in the scenarios shown as this plan is not intended to be an ongoing remuneration element under our policy
under the psp  the normal maximum limit of 150 of salary has been shown rather than the exceptional limit of 200 of salary
allcolleague share plans have been excluded
any legacy awards which executive directors hold have been excluded
these charts are for illustrative purposes only and actual outcomes may differ from that shown
100
£475000
minimum
performance
ontarget
performance
maximum
performance
60 27 13
28 41 31
£1539000
£789000
chief executive – nick wood
fixed pay annual bonus performance share plan
100
£360000
minimum
performance
ontarget
performance
maximum
performance
60 27
28 41 31
£1160000
13
£597000
chief financial ofﬁcer – ian kellett
fixed pay annual bonus performance share plan
“the remuneration package 
for all colleagues including the 
executive directors is reviewed 
on an annual basis and a 
consistent approach is applied 
at all levels”
pets at home group plc
annual report and accounts for the year ended 27th march 2014
96
governance chief executive chief financial officer
base salary £425000 £320000
benefits £11500 £11500
pension £38250 £28800
total fixed pay £474750 £360300
f consideration of conditions elsewhere in the company
as per the committee’s terms of reference we also review the pay and conditions of colleagues at levels below the executive directors this includes 
approving the design of and determining targets for any performance related pay schemes such as the bonus scheme operated by the company and 
approving the total annual payments made under such schemes the committee is also consulted concerning any major changes in colleague benefit 
structures throughout the group
the remuneration package for all colleagues including the executive directors is reviewed on an annual basis and a consistent approach is applied at 
all levels  as part of the annual salary and benefits review the company takes into account industry standards future legislative framework including 
the national minimum wage and the financial and economic environment of the group both internally and externally the annual salary and benefits 
review is presented to the committee with recommendations on remuneration throughout the colleague base including a proposed salary increase to 
be applied to all colleagues’ wages including executive directors as such the committee has regard to this groupwide annual review process when 
setting its remuneration policy for executive directors
whilst our colleagues are not directly consulted as part of the process of determining pay the output from colleague surveys including our internal 
‘we’re all ears’ survey is considered when carrying out the annual salary and benefits review 
a significant number of our colleagues are also shareholders and so are able to express their views in the same way as other shareholders as a 
result of the ipo process and the colleague offer referred to on page 82
g consideration of shareholder views
although we have only recently become a public listed company the committee recognises the importance of building a good relationship with our new 
shareholders this reflects our commitment to follow the highest standards of practice in relation to remuneration and governance at pets at home 
in reviewing the remuneration arrangements which were put in place at ipo the committee evaluated current best practice in the listed environment 
in particular the committee was keen to promote alignment motivate our executive team and retain key talent to drive our business strategy our aim 
was to adopt a remuneration framework which would drive achievement of our corporate goals whilst providing shareholders with comfort that it was 
appropriate justified and did not encourage unacceptable risk management behaviour
we will continue to monitor shareholder views when evaluating and setting ongoing remuneration strategy and we commit to consulting with 
shareholders prior to any significant changes to our remuneration policy
h minor amendments
the committee may make minor amendments to the policy set out above for regulatory exchange control tax or administrative purposes or to take 
account of a change in legislation without obtaining shareholder approval for that amendment
investorspetsathomecom
london stock exchange pets
97
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
annual report on remuneration
a single total figure of remuneration for executive directors for the year ended 27th march 2014
the information presented from this section up until the relevant note on page 103 represents the audited section of this report
the following table sets out the total remuneration for executive directors for the year ended 27th march 2014 the company was incorporated on 
10th february 2014 however payments were received by the executive directors in respect of the period from 17th march to 27th march 2014 since 
the company is a newly incorporated and listed company there are no prior year comparator figures
director
salary
£
benefits
£
pension
£
annual 
bonus
£
longterm 
incentives
£
total 
£
nick wood 11918 348 1073 6122 na 19460
ian kellett 8556 348 770 7207 na 16880
base salary — corresponds to the amount received during the financial year since ipo
as explained in the remuneration committee chairman’s statement above prior to ipo the salaries of our executive directors were reviewed against 
other companies comparable to pets at home 
 nick wood’s base salary reflects his annual salary of £425000 per annum paid by the company since ipo to the year end
 ian kellett’s base salary reflects his annual salary of £320000 per annum paid by the company since ipo to the year end
benefits — corresponds to the taxable value of benefits received during the financial year since ipo and principally includes company car or cash 
equivalent life assurance and permanent health insurance
pension — corresponds either to amount contributed to personal pension plans or the cash value of salary supplement received during the financial 
year since ipo executive directors receive a company pension contribution worth 9 of their salary or a cash allowance where the annual allowance 
has been reached 
annual bonus — corresponds to the annual bonus earned in respect of performance in the year ended 27th march 2014 prorated over the period 
since ipo
the payments were determined by the remuneration committee under the bonus plan approved by the preipo remuneration committee with awards 
being linked to both preset targets for the group’s underlying ebitda and achievement of nonfinancial personal objectives which were aligned to 
the key strategic priorities of the group the terms of the plan provided for a payment of up to 50 of salary for achievement of certain levels of 
financial targets and up to 25 of salary for achievement of the agreed personal objectives together with the discretion to make additional awards 
for exceptional performance shareholders will recognise that we have not disclosed specific financial performance targets for reasons of commercial 
sensitivity the remuneration committee approved the bonus awards having taken account of
 achievement of underlying group ebitda of £1107m
 individual contribution to the preparation and execution of the ipo
 performance against individually set targets for the ceo these included the implementation of sap  successful delivery of smaller store 
format and achievement of a number of core kpis such as achievement of new store opening pipeline for the cfo these included successful 
integration of the finance function of the vets4pets business and achievement of targeted synergies achievement of the working capital plan and 
implementation of the sap function into the finance team
longterm incentives — no relevant longterm incentives vested in respect of the year under consideration
pets at home group plc
annual report and accounts for the year ended 27th march 2014
98
governance b single total figure of remuneration for nonexecutive directors for the year ended 27th march 2014
the following table sets out the total remuneration for nonexecutive directors and the chairman of the board for the year ended 27th march 2014 the 
figures shown represent the remuneration received from the date of appointment until 27th march 2014 with the exception of tony denunzio which runs 
from the date of the ipo on 17th march to 27th march 2014 in addition we have not been able to show prior year comparator figures
director
date of 
appointment
basic
 fees 
£
additional 
fees 
£
remuneration 
committee 
chairman 
£
audit 
committee 
chair 
£
nomination 
committee 
chairman 
£
pets before 
profitcsr 
committee 
chair 
£
total 
£
tony denunzio 18th february 2014 6044 na na na na na 6044
dennis millard 18th february 2014 5220 2088 1044 na na na 8352
brian carroll 18th february 2014 5220 na na na na na 5220
paul coby 18th february 2014 5220 na na na na na 5220
tessa green 18th february 2014 5220 na na na na 1044 6264
amy stirling 18th february 2014 5220 na na 1044 na na 6264
paul moody 25th march 2014 412 na na na na na 412
note the additional fee paid to dennis millard is in respect to his position as deputy chairman of the board michael adams and praxis management limited were appointed as directors of the 
company on 10th february 2014 and both resigned on 11th february 2014 they were directors for administration purposes in connection with the incorporation of the company and so did not receive 
any remuneration for their services
c scheme interests awarded during the financial year
the tables below provide details on longterm incentive awards which were made to executive directors during the financial year these awards were 
made under the coinvestment plan and took place at the time of the ipo in march 2014
individual type of award
face value
£
face value
 of salary threshold vesting
maximum 
vesting
end of 
performance 
period
nick wood matching award nilcost 
options
£1062500 250 for eps element 75 of the award
133 of face value
for tsr element 25 of the award
25 of face value
100 of 
face value
31st march 
2017
ian kellett £800000 250
to receive these awards the two executive directors had to commit 250 of their base salary in shares invested shares the matching awards 
which represent a company match of 11 on the invested shares will vest subject to the eps and relative tsr performance conditions which are 
outlined in the policy table on page 87
investorspetsathomecom
london stock exchange pets
99
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
for the purposes of the relative tsr performance condition the comparator group is outlined below
relative tsr comparator group
booker group brown n group carpetright
debenhams dignity dixons retail
dunelm greggs halfords group
home retail group inchcape kingfisher
marks  spencer group morrison wm supermarkets next
ocado group sainsbury j sports direct international
tesco udg healthcare public wh smith
d payments for loss of office
no payments for loss of office were made during the financial year
e payments to past directors
no payments were made to past directors during the year
f statement of directors’ shareholding and share interests
the committee believes that colleague share ownership is an important means to support longterm commitment to the company and the alignment 
of colleague interests with those of shareholders
the interests of the executive directors are closely aligned with those of other shareholders in this regard through the operation of the coinvestment 
plan which required participants to commit a significant amount of their ipo proceeds this was a oneoff award from 2016 onwards executive 
directors will participate in the psp  which will further align their interests with those of shareholders both of these remuneration elements constitute 
a significant proportion of the individual remuneration packages
executive directors are subject to a shareholding requirement of 200 of base salary which should be built up over a period of five years this policy 
continues below the board with the next level of senior executives also subject to a shareholding guideline the committee reviews share ownership 
levels annually
current shareholding levels for directors are set out in the table below
number of shares
director
shareholding 
requirement  
as a  of salary 
target –  
achieved
shares owned 
outright at 
27th march 
2014
interests in share
 incentive schemes
 awarded without
 performance
 conditions at
27th march
2014
interests in 
share incentive 
schemes 
awarded subject 
to performance 
conditions at 
27th march 
2014
shares owned 
outright at 
17th march 
2014
nick wood 200 3044 5505571 — 433673 7340760
ian kellett 200 2972 4047056 — 326530 4640415
tony denunzio — 3158026 — — 3977342
dennis millard — 16327 — — 16327
brian carroll — 40816 — — 40816
paul coby — 4082 — — 4082
tessa green — 40816 — — 40816
amy stirling — 16327 — — 16327
paul moody — — — — —
note
for the purposes of determining executive directors’ shareholdings the individual’s salary and the share price as at 17th march 2014 has been used 245 pence
this represents the end of the audited section of the report
pets at home group plc
annual report and accounts for the year ended 27th march 2014
100
governance g tsr performance chart
given that the company has only been a public listed company since 17th march 2014 there is limited share price information and ceo remuneration 
and so a chart has not been included this disclosure will be expanded over later years
chief executive 200910 201011 201112 201213 201314
ceo single figure of remuneration na na na na 19460
annual bonus payout
as  of maximum opportunity na na na na 73
longterm incentive vesting
as  of maximum opportunity na na na na na
note the single figure of remuneration relates to the period 17th march 2014 to 27th march 2014
h percentage change in remuneration of the group chief executive
this section is not applicable as the company was only incorporated in february 2014 and was listed in march 2014 and therefore has no prior year 
comparator which can be shown
i relative importance of the spend on pay
this section is not applicable as the company was only incorporated in february 2014 and was listed in march 2014 and therefore has no prior year 
comparator which can be shown
j dilution limits
in accordance with the abi guidelines the company can satisfy awards under its colleague share plans with new issue shares up to maximum of 10 
of its issued share capital in a rolling ten year period and within this 10 limit the company can only issue 5 of its issued share capital to satisfy 
awards under discretionary plans 
k external appointments
executive directors are entitled to accept one external appointment outside the company with the consent of the board any fees received may be 
retained by the director
as at the date of this report neither of the executive directors held an external appointment for which they receive a fee
l nonexecutive directors — letters of appointment
a summary of the nonexecutive directors’ letters of appointment is contained on page 95
statement of implementation for 201415
this section provides an overview of how the committee is proposing to implement our remuneration policy in 2014
base salary
the table below shows base salaries for 201415 there are no proposed changes to base salaries in 20142015
nick wood £425000
ian kellett £320000
investorspetsathomecom
london stock exchange pets
101
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 remuneration report
continued
benefits
the committee sets benefits in line with the policy set out on page 85 there are no changes proposed to the benefit framework in 201415
pensions
there is no increase proposed to salary supplement levels for the executive directors in 201415 the table below shows salary supplements for 
201415
 of salary
nick wood 9
ian kellett 9
annual bonus
the maximum annual bonus opportunity for executive directors in respect of 201415 will be 100 of base salary
the annual bonus framework will be in line with that presented in the policy table on page 86 at this stage the committee considers that the exact 
annual bonus targets remain commercially sensitive however in next year’s annual report we commit to providing shareholders with as much context 
as possible on performance against those targets and rationale for the resulting annual bonus outturns within commercial constraints
performance share plan
there is currently no intention for executive directors to participate in the psp until 2016 given that they received awards under the cip on ipo 
nonexecutive director remuneration
the table below shows the nonexecutive director fee structure for 201415
201415
chairman of the board all inclusive fee £200000
basic nonexecutive director fee £50000
board committee chairman fee £10000
deputy chairman £20000
there are no fees paid for membership of board committees
pets at home group plc
annual report and accounts for the year ended 27th march 2014
102
governance m the remuneration committee
shareholder context for the committee’ s activities
during the year the committee received independent advice on executive remuneration matters from deloitte llp deloitte 
deloitte is a member of the remuneration consultants group and as such voluntarily operates under the code of conduct in relation to executive 
remuneration consulting in the uk the committee has reviewed the advice provided by deloitte during the year and is comfortable that it has been 
objective and independent total fees received by deloitte in relation to the remuneration advice provided to the committee during 201314 amounted 
to £70000 excl vat based on the required time commitment 
in addition other practices of deloitte separate from the executive remuneration practice have provided general tax advice to the group during  
the year
during fy14 the committee also received support from travers smith llp on the terms of the discretionary and allcolleague share plans 
the committee met once during fy14 post listing the individuals listed in the table below none of whom were committee members attended at 
least part of the meeting by invitation during the year
attendee position
tony denunzio chairman of the board
brian carroll nonexecutive director
sally hopson customer people and development director
nick wood ceo
none of the individuals attended part of any meeting in which their own compensation was discussed
governance
the board and the committee consider that throughout 201314 and up to the date of this report the company has complied with the provisions of 
the uk corporate governance code relating to directors’ remuneration
shareholder voting
the company has yet to hold a shareholder vote on its remuneration report
annual general meeting
as set out in my statement on page 82 our policy report and annual report on remuneration will be subject to a binding and advisory vote respectively 
at our agm to be held on 9th september 2014
on behalf of the board
dennis millard 
chairman of the remuneration committee
11th june 2014
investorspetsathomecom
london stock exchange pets
103
governance
board of directors 54
executive management team 58
directors’ report 60
statement of directors’ 
responsibilities 65
chairman’s governance statement 66
corporate governance report 69
report of the audit committee  76
remuneration report 82
  – remuneration policy 84
  – annual report on remuneration 98 2341002     17 july 2014 323 pm     proof 9
104 2341002     17 july 2014 323 pm     proof 9
see additional information online at
investorspetsathomecomourcompanyourservices
105
financial
statements 2341002     17 july 2014 323 pm     proof 9
independent auditor’ s report 
to the members of pets at home group plc only 
opinions and conclusions arising from our audit
1 our opinion on the financial statements is unmodified 
we have audited the financial statements of pets at home group plc for the year ended 27th march 2014 set out on pages 108 to 156 in our 
opinion 
 the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs as at 27th march 2014 and of 
the group’s profit for the year then ended 
 the group financial statements have been properly prepared in accordance with international financial reporting standards as adopted by the 
european union ifrss as adopted by the eu 
 the parent company financial statements have been properly prepared in accordance with ifrss as adopted by the eu and as applied in 
accordance with the provisions of the companies act 2006 and 
 the financial statements have been prepared in accordance with the requirements of the companies act 2006 and as regards the group 
financial statements article 4 of the ias regulation 
2 our assessment of risks of material misstatement
in arriving at our audit opinion above on the financial statements the risks of material misstatement that had the greatest effect on our audit were  
as follows
ipo accounting and disclosures
refer to page 78 audit committee report pages 116118 accounting policy and pages 140141 financial disclosures
 the risk the public listing of the group in march 2014 was preceded by changes to the group’s legal structure the restructuring involved a 
number of legal steps which included the issue of a mix of debt and equity and resulted in significant transaction costs some of which were 
recorded as a deduction from debt and equity due to the complex nature of these transactions and the judgement involved in allocating the 
costs this has been an area of focus for our audit this year 
 our response our audit procedures included among others assessing the validity and accurate reflection of each of the steps to create the 
new corporate structure we inspected external legal advice obtained by the group to assess if the group’s capital structure has been correctly 
accounted for in line with companies act 2006 requirements we used our own financial reporting specialists to assist us in challenging the 
accounting principles applied we also challenged the appropriate classification of transaction costs as an expense or deduction from debt or 
equity and assessed whether the financial statement disclosures in relation to the ipo are sufficient and appropriate
carrying value of inventory £461m
refer to page 79 audit committee report page 122 accounting policy and page 136 financial disclosures
 the risk inventory is carried at the lower of cost and net realisable value the group is exposed to inventory recoverability risk as a result of new 
product launches changes in customer preferences and consumer spending patterns with respect to the group’s products the group carries a 
broad range of products some with a limited shelf life and may be unable to sell products in sufficient quantities during the relevant seasons it 
may be difficult to accurately forecast demand when a new product is launched and the demand for products may also change between the time 
inventory is ordered from suppliers and the date of sale as such there is a risk that the carrying value of inventory exceeds its net realisable 
value
 our response our audit procedures included among others assessing the principles and appropriateness of the group’s inventory provisioning 
policies based on our understanding of the business and the accuracy of previous provisioning estimates we obtained the inventory provision 
calculation and performed a recalculation of the amounts we challenged whether inventory lines and sales prices had been appropriately 
included in the calculation through an analysis of data from both the inventory and sales system we analysed specific attributes including 
historical sales trends the ageing of individual inventory lines and sales prices we also assessed the adequacy of the disclosures in respect of 
amounts recognised as provision against inventory during the period
3 our application of materiality and an overview of the scope of our audit
the materiality for the group financial statements as a whole was set at £20m this has been determined with reference to a benchmark of group 
profit before taxation which we consider to be one of the principal considerations for members of the company in assessing the financial performance 
of the group materiality represents 38 of pbt adjusted for items disclosed separately on the face of the income statement
we agreed with the audit committee to report to it all corrected and uncorrected misstatements we identified through our audit with a value in excess 
of £01m in addition to other audit misstatements below that threshold that we believe warranted reporting on qualitative grounds
106
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
audits were performed by the group audit team at the key reporting entities in the uk these group procedures covered 96 of total group revenue 
80 of group profit before taxation and 97 of total group assets 
the audits undertaken for group reporting purposes at the key reporting components of the group were all performed to materiality levels set 
individually for each component and ranged from £02m to £19m
4 our opinion on other matters prescribed by the companies act 2006 is unmodified 
in our opinion 
 the part of the directors’ remuneration report to be audited has been properly prepared in accordance with the companies act 2006 and
 the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is 
consistent with the financial statements  
5 we have nothing to report in respect of the matters on which we are required to report by exception 
under isas uk and ireland we are required to report to you if based on the knowledge we acquired during our audit we have identified other 
information in the annual report that contains a material inconsistency with either that knowledge or the financial statements a material 
misstatement of fact or that is otherwise misleading 
in particular we are required to report to you if 
 we have identified material inconsistencies between the knowledge we acquired during our audit and the directors’ statement that they consider 
that the annual report and financial statements taken as a whole is fair balanced and understandable and provides the information necessary 
for shareholders to assess the group’s performance business model and strategy or
 the audit committee report does not appropriately address matters communicated by us to the audit committee
under the companies act 2006 we are required to report to you if in our opinion 
 adequate accounting records have not been kept by the parent company or returns adequate for our audit have not been received from branches 
not visited by us or 
 the parent company financial statements and the part of the directors’ remuneration report to be audited are not in agreement with the 
accounting records and returns or 
 certain disclosures of directors’ remuneration specified by law are not made or 
 we have not received all the information and explanations we require for our auditor or
under the listing rules we are required to review 
 the directors’ statement set out on page 64 in relation to going concern and
 the part of the corporate governance report on pages 6975 relating to the company’s compliance with the nine provisions of the 2010 uk 
corporate governance code specified for our review
we have nothing to report in respect of the above responsibilities
scope of report and responsibilities
as explained more fully in the directors’ responsibilities statement set out on page 65 the directors are responsible for the preparation of the 
financial statements and for being satisfied that they give a true and fair view a description of the scope of an audit of financial statements is 
provided on the financial reporting council’s website at wwwfrcorgukauditscopeukprivate this report is made solely to the company’s members 
as a body and is subject to important explanations and disclaimers regarding our responsibilities published on our website at wwwkpmgcomuk
auditscopeukco2013a which are incorporated into this report as if set out in full and should be read to provide an understanding of the purpose of 
this report the work we have undertaken and the basis of our opinions
david bills senior statutory auditor   
for and on behalf of kpmg llp  statutory auditor   
chartered accountants   
st james square 
manchester 
m2 6ds 
11th june 2014
investorspetsathomecom
london stock exchange pets
107
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
consolidated income statement
 period ended 27th march 2014 period ended 28th march 2013
note
£000
underlying 
trading
£000
exceptional 
items note 3
£000
total
£000
underlying 
trading
£000
exceptional 
items note 3
£000
total
revenue 12 665395 – 665395 598337 – 598337
cost of sales 307271 – 307271 274362 – 274362
gross profit 358124 – 358124 323975 – 323975
selling and distribution expenses 233891 – 233891 215177 – 215177
administrative expenses 3 34817 10574 45391 29815 6049 35864
operating profit 2 89416 10574 78842 78983 6049 72934
financial income 368 – 368 388 – 388
financial expenses 7 37547 19158 56705 39351 7459 46810
net financing expense 37179 19158 56337 38963 7459 46422
profit before tax 52237 29732 22505 40020 13508 26512
taxation 8 13672 4715 8957 9189 3210 5979
profit for the period 38565 25017 13548 30831 10298 20533
all activities relate to continuing operations
basic and diluted earnings per share attributable to equity shareholders of the company
equity holders of the parent 
– underlying trading 6 £001 £012
equity holders of the parent 
– after exceptional items 6 £014 £020
consolidated statement of comprehensive income
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
profit for the period 13548 20533
other comprehensive income
items that are or may be recycled subsequently into profit or loss
foreign exchange translation differences 5 1
cash flow hedges – reclassified to profit and loss 811 110
effective portion of changes in fair value of cash flow hedges 1442 2978
other comprehensive income for the period before income tax 636 3087
income tax on other comprehensive income 159 752
other comprehensive income for the period net of income tax 477 2335
total comprehensive income for the period 14025 22868
108
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
note
at 27th march 
2014
£000
at 28th march 
2013
£000
noncurrent assets
property plant and equipment 9 93628 84622
intangible assets 10 955238 955004
other financial assets 14 6619 3727
1055485 1043353
current assets
inventories 12 46116 42056
deferred tax assets 13 45 959
other financial assets 14 – 811
trade and other receivables 15 42159 34041
cash and cash equivalents 16 90823 31593
179143 109460
total assets 1234628 1152813
current liabilities
other interestbearing loans and borrowings 17 – 5708
trade and other payables 18 149547 104299
provisions 19 461 380
other financial liabilities 14 1113 1894
151121 112281
noncurrent liabilities
other interestbearing loans and borrowings 17 319855 413927
other payables 18 31068 49967
provisions 19 1835 1914
352758 465808
total liabilities 503879 578089
net assets 730749 574724
equity attributable to equity holders of the parent
ordinary share capital 20 5000 1659
share premium 20 1080477 291492
additional paid in capital 20 – 612680
consolidation reserve 372026 372026
merger reserve 113321 113321
translation reserve 4 1
cash flow hedging reserve 362 834
retained earnings 95634 71567
share based payment reserve 31 –
total equity 730749 574724
on behalf of the board
ian kellett 
chief financial officer
11th june 2014
consolidated balance sheet
investorspetsathomecom
london stock exchange pets
109
financial statements
independent auditor’s report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
share
capital
£000
share 
premium
£000
additional 
paid in 
capital
£000
consolidation 
reserve
£000
merger 
reserve
£000
cash flow 
hedging 
reserve
£000
translation
reserve
£000
retained
earnings
£000
share 
based 
payments 
reserve
£000
total
equity
£000
balance at 28th march 2013 1659 291492 612680 372026 113321 834 1 71567 – 574724
total comprehensive 
income for the period
profit for the period – – – – – – – 13579 31 13548
other comprehensive income – – – – – 472 5 – – 477
total comprehensive income 
for the period – – – – – 472 5 13579 31 14025
transactions with owners 
recorded directly in equity
issue of shares
i 
1405 342916 344321 – – – – – – –
issue of shares
ii
40 9697 – – – – – – – 9737
issue of shares
iii
1896 462574 – – – – – – – 464470
share issue costs – 26202 – 26202
dividends on additional paid 
in capital – – 37646 – – – – 37646 –
redemption of additional paid 
in capital – – 306005 – – – – – – 306005
total contributions by and 
distributions to owners 3341 788985 612680 – – – – 37646 – 142000
balance at 27th march 2014 5000 1080477 – 372026 113321 362 4 95634 31 730749
i on 17th march 2014 the company issued 140539069 ordinary £001 shares at a premium of £244 per share in exchange for £344321000 additional paid in 
capital issued by pah lux sarl 
ii on 17th march 2014 the company issued 3974537 ordinary £001 shares in exchange for debt issued by a subsidiary
iii on 17th march 2014 the company issued 189579314 ordinary £001 shares at a premium of £244 per share share issue costs of £26202000 were offset 
against the gross proceeds of £464470000
consolidated statement of changes in equity 
at 27th march 2014
110
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
share
capital
£000
share 
premium
£000
additional 
paid in 
capital
£000
consolidation 
reserve
£000
merger 
reserve
£000
cash flow 
hedging 
reserve
£000
translation
reserve
£000
retained
earnings
£000
total
equity
£000
attributable 
to parent
£000
attributable 
to non
controlling 
interest
£000
balance at 
29th march 2012 1277 284050 565331 372026 113321 3170 – 37025 551758 552265 507
total comprehensive 
income for the period
profit for the period – – – – – – – 20533 20533 20533 – 
other comprehensive 
income – – – – – 2336 1 – 2335 2335 –
total comprehensive 
income for the period – – – – – 2336 1 20533 22868 22868 –
transactions with owners 
recorded directly in equity
issue of shares 382 7442 1339 – – – – – 9163 9163 –
dividends on additional 
paid in capital – – 46010 – – – – 46010 – – –
total contributions by and 
distributions to owners 382 7442 47349 – – – – 46010 9163 9163 –
changes in ownership 
interests
acquisition of non
controlling interest without 
a change in control – – – – – – – 9065 9065 9572 507
total transactions with 
owners – – – – – – – 9065 9065 9572 507
balance at 
28th march 2013 1659 291492 612680 372026 113321 834 1 71567 574724 574724 –
consolidated statement of changes in equity 
at 28th march 2013
investorspetsathomecom
london stock exchange pets
111
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
consolidated statement of cash flows
period ended 
27th march 
2014
£000
period ended
 28th march 
2013
£000
cash flows from operating activities
profit for the period 13548 20533
adjustments for
depreciation and amortisation 19990 18207
financial income 368 388
financial expense 56705 46810
loss on sale of ppe 77 90
taxation 8957 5979
98909 91231
increase in trade and other receivables 7969 6002
increase in inventories 4060 1678
increase in trade and other payables 21771 27001
increase in ipo related trade and other payables i 25184 –
total increase in trade and other payables 46955 27001
increasedecrease in provisions 2 64
133837 110488
tax paidreceived 9192 4527
net cash from operating activities 124645 115015
cash flows from investing activities
proceeds from sale of ppe – 663
interest received 368 388
investment in other financial assets 1753 1201
acquisition of subsidiary net of cash acquired 2000 47900
acquisition of ppe and other intangible assets 26278 20446
net cash used in investing activities 29663 68496
cash flows from financing activities
proceeds from the issue of ordinary share capital 464470 7824
share issue costs 26202 –
debt issue costs 10494 6562
repayment of paid in capital 306005 –
proceeds from new loan 460000 130000
repayment of borrowings 585260 173987
interest paid 32261 32679
acquisition of noncontrolling interest – 9075
net cash used in financing activities 35752 84479
net increasedecrease in cash and cash equivalents 59230 37960
cash and cash equivalents at beginning of period 31593 69553
cash and cash equivalents at end of period 90823 31593
i the increase in ipo related trade and other payables of £25184000 relates to costs incurred as part of the ipo on 17th march 2014 which were included in accruals 
and other creditors at the period end date
112
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
note
at 27th march 
2014
£000
noncurrent assets
investments in subsidiaries 11 936179
current assets
trade and other receivables 15 565441
cash and cash equivalents 16 22829
588270
total assets 1524449
current liabilities
trade and other payables 18 14797
noncurrent liabilities
other interestbearing loans and borrowings 17 319855
total liabilities 334652
net assets 1189797
equity attributable to equity holders of the parent
ordinary share capital 20 5000
share premium 20 1080477
merger reserve 113321
retained earnings 8970
share based payment reserve 31
total equity 1189797
on behalf of the board
ian kellett 
chief financial officer
11th june 2014
company number 08885072
company balance sheet
investorspetsathomecom
london stock exchange pets
113
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
share 
capital 
£000
share 
premium 
£000
merger 
reserve 
£000
retained 
earnings 
£000
share based 
payment 
reserve 
£000
total 
equity 
£000
total comprehensive income for the period
result for the period – – – 8970 31 9001
other comprehensive income note 20 – – – – – –
total comprehensive income for the period – – – 8970 31 9001
transactions with owners recorded directly in equity
issue of shares note 20 5000 1080477 113321 – – 1198798
balance at 27th march 2014 5000 1080477 113321 8970 31 1189797
company income statement
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 loss for the year was £90m
company statement of changes in equity 
at 27th march 2014
114
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
period ended 
27th march 
2014
£000
cash flows from operating activities
loss for the period 9001
9001
increase in trade and other receivables 565441
increase in trade and other payables 14797
net cash from operating activities 559645
cash flows from investing activities
acquisition of subsidiary net of cash acquired 175648
net cash used in investing activities 175648
cash flows from financing activities
proceeds from the issue of ordinary share capital 464469
share issue costs 26202
proceeds from new loan 325000
issue costs 5145
net cash obtained from financing activities 758122
net increase in cash and cash equivalents 22829
cash and cash equivalents on incorporation –
cash and cash equivalents at end of period 22829
company statement of cash flows
investorspetsathomecom
london stock exchange pets
115
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
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
summary of impact of group restructure and initial public offering
on 17th march 2014 the group listed its shares on the london stock exchange in preparation for the initial public offering “ipo” the group 
was restructured the restructure has impacted a number of the current year and comparative primary financial statements and notes
for the consolidated financial statements of the group prepared under ifrs the principles of reverse acquisition accounting under ifrs 3 
”business combinations” have been applied the steps to restructure the group had the effect of pets at home group plc “plc” being inserted 
above pets at home lux sarl “pah lux” as the holders of pah lux share capital and preferred equity certificates “pecs” exchanged their 
pah lux shares and a portion of their pecs for shares in plc
by applying the principles of reverse acquisition accounting the group is presented as if plc has always owned the pah lux group the 
comparative income statement and balance sheet are presented in line with the previously presented pah lux position the comparative and 
current year consolidated reserves of the group are adjusted to reflect the statutory share capital share premium and merger reserve of plc as 
if it had always existed adjusted for movements in the underlying pah lux share capital and reserves until the share for share exchange 
the steps taken to restructure the group are explained in more detail in section 12 the impact on the primary consolidated financial 
statements is as follows
 equity reflects the capital structure of plc  as part of the restructuring of the group a number of shares in plc were issued in exchange for 
various instruments or for cash the premium arising on the issue of shares is allocated between the share premium and merger reserve
 a consolidation reserve is created this reflects the difference between the plc reserves at the balance sheet date as reflected in the 
opening reserves at the start of the comparative period 29th march 2012 and the consolidated equity of pah lux at the same date
 prior to their cancellation as part of the ipo restructure the pecs issued by pah lux and shown as additional paid in capital in the 
consolidated financial statements are shown as equity and the coupon charged on them is charged through reserves as a dividend 
 as part of the restructure the pecs were ultimately exchanged for a combination of cash and shares in plc
 fees associated with the ipo are allocated to share premium secured bank debt and the consolidated income statement depending on 
the nature of the costs costs allocated against the secured bank debt will be amortised over the period of the financing fees charged to 
the consolidated income statement have been presented as exceptional items
 due to the timing of the ipo not all fees had been paid at year end and hence there were significant balances in trade and other creditors 
for outstanding fees  
 the group refinanced its external bank debt using proceeds from the ipo to reduce the net debt position of the group unamortised fees 
associated with the previous financing have been written off in the period this noncash cost has been presented as an exceptional item 
in the consolidated income statement
11 basis of preparation
the consolidated financial statements presented in this document have been prepared in accordance with international financial reporting 
standards ifrs as adopted by the european union the company’s financial statements have been prepared in accordance with ifrs as 
adopted by the european union and 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
these are the first set of consolidated financial statements of pets at home group plc which is the new ultimate holding company of the  
pah lux s formerly kkr my best friend lux sarl group following the reorganisation of the group to facilitate the initial public offering 
the financial statements have been presented as a continuation of the pah lux s business to do so the principles of reverse acquisition 
accounting in ifrs 3 “business combinations” have been applied the result of the application is to present the financial statements as if pets 
at home group plc has always owned the group comparatives have also been prepared on this basis accordingly
notes forming part of the financial statements
116
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
1 significant accounting policies continued
the pets at home group has not previously prepared consolidated financial statements in accordance with eu endorsed ifrs as such these 
financial statements represent its first eu ifrs financial statements and ifrs 1 ‘first time adoption of international financial reporting 
standards’ has been applied however as the main trading group pah retail ltd adopted ifrss in the prospectus these consolidated financial 
statements reflect the amounts previously reported together with the additional assets liabilities income and expenses of entities that did not 
form part of that group as pets at home group has not previously presented consolidated financial statements no reconciliations from previous 
gaap have been presented to aid users the group has set out a summary of the key differences between uk gaap the group’s subsidiaries’ 
previous gaap and ifrs in note 14
the financial statements are prepared under the historical cost convention as modified by the revaluation of derivative financial instruments 
to fair value and in accordance with those parts of the companies act 2006 applicable to companies reporting under ifrs as adopted by 
the european union new standards and interpretations issued by the international accounting standards board iasb and the international 
financial reporting interpretations committee ifric becoming effective during the year have not had a material impact on the group’s financial 
statements
the financial statements have been prepared on a going concern basis in determining the appropriate basis of preparation of the financial 
statements the directors are required to consider whether the group can continue in operational existence for the foreseeable future the 
directors are of the opinion that the group and the company have adequate resources to continue in operational existence for the foreseeable 
future and feel it appropriate to adopt the going concern basis in preparing this annual report and financial statements
12 group reorganisation
prior to the initial public offering “ipo” the group undertook a reorganisation in preparation for the transaction
the effect of this reorganisation was to insert two new companies into the group a new ultimate parent company pets at home group plc and 
its wholly owned subsidiary pets at home no 1 limited which is summarised below acquired the entire issued share capital pah retail ltd 
pets at home group plc became the ultimate parent company of the group by acquiring directly and indirectly interests in pah lux sarl in 
exchange for the issue of new shares as part of this process preferred equity certificates issued by pah lux sarl were ultimately capitalised 
prior to that company’s transfer out of the group and subsequent placing into liquidation
key steps in this process included
 on 10th february 2014 a new company pets at home group plc was incorporated with one ordinary share of £1 on 14th february 2014 
one redeemable preference share of £50000 was issued 
 on 11th february 2014 a new intermediate holding company pets at home no 1 ltd was incorporated as a direct wholly owned 
subsidiary of pets at home group plc
 on 17th march 2014 pets at home group plc directly and indirectly acquired the entire share capital of pah lux sarl and £343m of 
preferred equity certificates issued by pah lux sarl in exchange for the issue of 306 million new ordinary shares of £001 per share 
creating a share premium of £634m and a merger reserve of £113m
investorspetsathomecom
london stock exchange pets
117
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
1 significant accounting policies continued
 on 17th march 2014 pets at home no 1 ltd acquired the entire issued share capital of pah lux sarl and certain preferred equity 
certificates issued by pah lux sarl and held by pets at home group plc in exchange for 100 new ordinary shares
 on 17th march 2014 pets at home no 1 ltd purchased the remaining £1756m of preferred equity certificates issued by pah lux sarl 
and outstanding interest in exchange for the issue of a subordinated loan note instrument
 on 17th march 2014 pah uk midco limited formerly kkr my best friend uk midco ltd a subsidiary of the group capitalised £97m of 
its issued loan notes by issuing new ordinary shares on the same date pets at home group plc acquired these ordinary shares issued 
by pah uk midco ltd by way of share for share exchange issuing 4000000 ordinary £001 shares creating a share premium of £244 
per share
 on 17th march 2014 pets at home no 1 ltd acquired the entire issued share capital of pah retail ltd the consideration for which was 
left outstanding at an intercompany balance
 on 17th march 2014 pets at home group plc issued 189460946 ordinary £001 share capital at an initial offer price of £245  
per share generating proceeds of £4642m on the same date pets at home group plc drew down £325m of senior debt facility
 subsequent to the ipo and prior to the year end pah lux sarl pah international limited and pah uk finco limited were transferred out 
of the group pah lux sarl and pah uk finco were placed into liquidation
the group used the proceeds of the ipo and new senior term debt to settle the group’s previous senior debt the preferred equity certificates 
issued by pah lux sarl were ultimately exchanged for cash further utilising proceeds from the transaction andor shares in pets at home 
group plc this has been treated as a distribution from the consolidated reserves of the group
on 8 april 2013 pah luxco sarl redeemed £130400000 of preferred equity certificates plus outstanding yield 
13 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 or as availableforsale non
current assets held for sale are stated at the lower of previous carrying amount and fair value less costs to sell
14 uk gaap to ifrs information
the main trading businesses within the group present their statutory accounts under uk generally accepted accounting principles uk gaap 
the key differences arising on transition to ifrs in the consolidated group financial statements for financial information previously presented 
under uk gaap are as follows
 recognition of lease incentives over the full lease term
 acquisition costs relating to business combinations effected on or after 26th march 2010 the group’s ifrs transition date are expensed 
in accordance with ifrs 3 revised “business combinations”
 goodwill is not amortised
 recognition of derivative financial instruments on the statement of financial position through other comprehensive income
15 going concern
the company’s business activities together with the factors likely to affect its future development performance and position are set out in the 
strategic report on pages 3 to 51 the financial position of the company its cash flows liquidity position and borrowing facilities are described 
in the chief financial officer’s review on pages 42 to 47 in addition notes 20–21 to the financial statements include the 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 company has considerable financial resources and financing facilities and prepares detailed business plans that model headroom on 
financial covenants 
the directors believe the group is well placed to manage its business risks successfully and therefore have a reasonable expectation that the 
group has adequate resources to continue in operational existence for the foreseeable future accordingly they continue to adopt the going 
concern basis in preparing the consolidated financial statements 
118
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
1 significant accounting policies continued
16 basis of consolidation
subsidiaries
subsidiaries are entities controlled by the group control exists when the group has the power to govern the financial and operating policies 
of an entity so as to obtain benefits from its activities 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 noncontrolling interests in a subsidiary are allocated to the noncontrolling interests even if doing so causes the noncontrolling interests to 
have a deficit balance
other investments
the group has a number of nonparticipatory shareholdings in veterinary practice companies the veterinary practices were established under 
terms that do not give either party control and therefore are not consolidated in these financial statements these are accounted for as 
availableforsale investments
17 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 except for differences arising on the retranslation of a financial liability designated as a hedge of the net investment in a 
foreign operation that is effective or qualifying cash flow hedges which are recognised directly in other comprehensive income nonmonetary 
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 nonmonetary 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 noncontrolling interest as the case may be 
functional currency
the consolidated financial statements are presented in sterling which is the company’s functional currency and have been rounded to the 
nearest thousand
18 classification of financial instruments issued by the group
following the adoption of ias 32 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 nonderivative 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’s 
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 where the instrument so classified takes 
the legal form of the company’s own shares the amounts presented in these financial statements for called up share capital exclude amounts 
in relation to those shares 
investorspetsathomecom
london stock exchange pets
119
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
1 significant accounting policies continued
19 nonderivative financial instruments
nonderivative financial instruments comprise investments in equity and debt securities trade and other receivables cash and cash equivalents 
loans and 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 impairment losses
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
investments in debt and equity securities
other investments in debt and equity securities held by the group are classified as being availableforsale and are stated at fair value with any 
resultant gain or loss being recognised directly in equity in the fair value reserve except for impairment losses and in the case of monetary 
items such as debt securities foreign exchange gains and losses when these investments are derecognised the cumulative gain or loss 
previously recognised directly in equity is recognised in profit or loss where these investments are interestbearing interest calculated using the 
effective interest method is recognised in profit or loss
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 purpose only of the cash flow statement
interestbearing borrowings
interestbearing 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 less any impairment losses
110 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 ie when interest income or expense is recognised
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
111 intragroup 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
120
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
1 significant accounting policies continued
112 property plant and equipment
property plant and equipment are 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 straightline basis over the estimated useful lives of each part of an item of property plant 
and equipment land is not depreciated the estimated useful lives are as follows
freehold property — 50 years 
motor vehicles — 3 years
fixtures fittings tools and equipment — 3–7 years
leasehold improvements — the term of the lease
depreciation methods useful lives and residual values are reviewed at each balance sheet date 
113 business combinations
subject to the relief in ifrs 1 all business combinations with the exception of those accounted for as reverse acquisitions are accounted for by 
applying the acquisition method business combinations are accounted for using the acquisition method as at the acquisition date which is the 
date on which control is transferred to the group 
acquisitions on or after 26th march 2010
for acquisitions on or after 26th march 2010 the group measures goodwill at the acquisition date as
 the fair value of the consideration transferred plus 
 the recognised amount of any noncontrolling 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
on a transactionbytransaction basis the group elects to measure noncontrolling 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 noncontrolling interests are 
measured at their fair value at the acquisition date 
acquisitions prior to 26th march 2010 date of adoption of ifrss
ifrs 1 grants certain exemptions from the full requirements of adopted ifrss for first time adopters in respect of acquisitions prior to  
26th march 2010 goodwill is included on the basis of its deemed cost
114 acquisitions and disposals of noncontrolling interests
acquisitions and disposals of noncontrolling interests that do not result in a change of control are accounted for as transactions with owners in 
their capacity as owners and therefore no goodwill is recognised as a result of such transactions the adjustments to noncontrolling interests 
are based on a proportionate amount of the net assets of the subsidiary any difference between the price paid or received and the amount by 
which noncontrolling interests are adjusted is recognised directly in equity and attributed to the owners of the parent
investorspetsathomecom
london stock exchange pets
121
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
1 significant accounting policies continued
115 intangible assets and goodwill 
goodwill
goodwill is stated at cost less any accumulated impairment losses goodwill is allocated to cashgenerating units and is not amortised but is 
tested annually for impairment 
other intangible assets
expenditure on internally generated goodwill and brands is recognised in the income statement as an expense as incurred
other intangible assets that are acquired by the group are stated at cost less accumulated amortisation and less accumulated impairment 
losses
amortisation
amortisation is charged to the income statement on a straightline basis over the estimated useful lives of intangible assets unless such lives 
are indefinite intangible assets with an indefinite useful life and goodwill are systematically tested for impairment at each balance sheet date 
other intangible assets are amortised from the date they are available for use the estimated useful lives are as follows
computer software 3–5 years
116 inventories
inventories are stated at the lower of cost and net realisable value cost is based on the first in first out 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
117 impairment excluding inventories and deferred tax assets
financial assets including receivables
a financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective 
evidence that it is impaired a financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial 
recognition of the asset and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated 
reliably
an impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount 
and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate interest on the impaired 
asset continues to be recognised through the unwinding of the discount when a subsequent event causes the amount of impairment loss to 
decrease the decrease in impairment loss is reversed through profit or loss
nonfinancial assets
the carrying amounts of the group’s nonfinancial 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 cashgenerating unit 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 pretax 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 “cashgenerating unit” the goodwill acquired in a business combination for the 
purpose of impairment testing is allocated to cashgenerating 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
122
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
1 significant accounting policies continued
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
118 employee benefits
defined contribution plans
a defined contribution plan is a postemployment benefit plan under which the company 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 
shortterm benefits
shortterm 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 shortterm cash bonus or profitsharing 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 or rights over shares
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 straightline 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
119 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 pretax rate that reflects risks specific to the liability
investorspetsathomecom
london stock exchange pets
123
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
1 significant accounting policies continued
120 revenue
revenue
revenue represents the total amount receivable for goods and services net of discounts and excluding value added tax sold in the ordinary 
course of business and arises from activities in the united kingdom 
revenue is recognised when significant risks and rewards of ownership have been transferred to the buyer there is reasonable certainty over 
recovery of the consideration and the amount of revenue associated costs and possible return of goods can be estimated reliably revenue is 
recognised when transactions are completed in store or online
i sale of goods in store and online
retail revenue is recorded net of value added tax colleague discounts coupons and vouchers 
ii fee income
fee income received from the joint venture veterinary practice companies is recognised in the period the services relate to and recorded net of 
value added tax 
iii vip scheme
the sales value of the points earned under the vip scheme are treated as deferred income the sales are only recognised once the points have 
been redeemed by the charities 
cost of sales
cost of sales includes costs of goods sold and other directly attributable costs and promotional income received from suppliers including costs 
to deliver business services to joint venture veterinary practices and costs to deliver grooming services
exceptional items
income or costs that are both material and nonrecurring whose significance is sufficient to warrant separate disclosure in the consolidated 
financial statements are referred to as exceptional items these are included and separately identified within their relevant income statement 
category
121 expenses
operating lease payments
payments made under operating leases are recognised in the income statement on a straightline basis over the term of the lease lease 
incentives received are recognised in the income statement over the term of the lease as an integral part of the total lease expense 
financing income and expenses
financing expenses comprise interest payable finance charges on shares classified as liabilities and finance leases recognised in profit or loss 
using the effective interest method unwinding of the discount on provisions and net foreign exchange 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 payments is established foreign currency gains and losses are 
reported on a net basis
122 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
124
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
1 significant accounting policies continued
122 taxation continued
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 
123 adopted ifrs not yet applied 
the following adopted ifrss have been issued but have not been applied by the group in these consolidated financial statements
ifrs 10 ‘consolidated financial statements 2011’ – on 12 may 2011 the iasb issued ifrs 10 consolidated financial statements which is a 
replacement of ias 27 consolidated and separate financial statements and sic12 consolidation – special purpose entities this is part of a 
new suite of standards on consolidation and related matters which will replace the existing accounting for subsidiaries and joint ventures now 
joint arrangements and will make limited amendments in relation to associates concurrent with the issuance of ifrs 10 the iasb also issued
 ifrs 11 ‘joint ventures 2011’
 ifrs 12 ‘disclosures of involvement with other entities 2011’
 ias 27 ‘separate financial statements revised 2011’ has been amended for the issuance of ifrs 10 but retains the current guidance for 
separate financial statements and
 ias 28 ‘investments in associates and joint ventures revised 2011’ has been amended for conforming changes based on the issuance of 
ifrs 10 and ifrs 11
each of the standards has an effective date for periods beginning on or after 1st january 2014 with earlier application permitted so long as 
each of the other standards in the ‘package of five’ is also early adopted
the impact of these new standards on the group is expected to lead to additional disclosure requirements in the group’s financial statements 
for the period ended march 2015 in relation to the joint venture arrangements in place with veterinary practices
ifrs 9 financial instruments – if endorsed this standard will simplify the classification of financial assets for measurement purposes it is not 
anticipated that this standard will have a significant impact on the group’s financial statements the effective date is to be determined
there are certain other amendments and interpretations effective from 1st january 2014 which are not expected to have any significant impact 
on the group
124 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 significant risk of causing a material adjustment to the carrying value of assets and liabilities are 
discussed below
carrying value of inventories
the managers review the market value of and demand for its inventories on a periodic basis to ensure inventory is recorded in the financial 
statements at the lower of cost and net realisable value any provision for impairment is recorded against the carrying value of inventories the 
managers use their knowledge of market conditions to assess future demand for the group’s products and achievable selling prices
investorspetsathomecom
london stock exchange pets
125
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
1 significant accounting policies continued
impairment of goodwill and other intangibles
determining whether goodwill and other intangibles are impaired requires an estimation of the value in use of the cashgenerating 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 cashgenerating unit 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 10
assumptions relating to tax
the group recognises expected assets for tax based on an estimation of the likely taxes receivable which requires significant judgement as to 
the ultimate tax determination of certain items where the actual asset arising from these issues differs from these estimates such differences 
will have an impact on income tax and deferred tax assets in the period when such determination is made
provisions
provisions have been made for dilapidations and for closed stores information about provisions and contingencies which are considered to 
have a risk of material adjustment in the next financial period due to the assumptions and estimations used are disclosed in note 19 the 
provisions are based on historical experience and management’s best knowledge at the time and are reviewed at each balance sheet date the 
actual costs and timing of future cash flows are dependent on future events any difference between expectations and the actual future liability 
will be accounted for in the period when such determination is made
2 segmental reporting
the directors consider there to be one operating and reportable segment being that of the sale of pet products and services through retail 
outlets and the group’s website 
the group’s board receives monthly financial information at this level and uses this information to monitor the performance of the store 
portfolio allocate resources and make operational decisions the internal reporting received focuses on the group as a whole and does not 
identify individual segments to increase transparency the group has decided to include an additional voluntary disclosure analysing revenue 
within the reportable segments
the performance of the operating segment is primarily based on a measure of ebitda before exceptional items share based payment charges 
and management charges this can be reconciled to statutory operating profit as follows
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
operating profit 78842 72934
exceptional items 10574 6049
management charges 1221 1298
share based payment charges 31 –
underlying operating profit 90668 80281
depreciation and amortisation 19990 18207
underlying earnings before interest tax depreciation and amortisation ebitda before exceptional items 110658 98488
revenue 
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
food 327101 297887
accessories 288017 268501
services and other 50277 31949
665395 598337
126
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
3 expenses and auditors’ remuneration
included in profitloss are the following
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
exceptional operating expenses 10574 6049
depreciation of tangible fixed assets 18053 16972
amortisation of intangible assets 1937 1235
rentals under operating leases
 hire of plant and machinery 2843 1598
 property 61903 58422
rental income from sublets 5952 4852
loss on disposal of fixed assets 77 90
exceptional costs in the period ended 27th march 2014 relate to costs associated with the initial public offering of pets at home group plc 
shares on the london stock exchange on 17th march 2014 £9383000 and costs associated with the integration of the vets4pets business 
into the group £2308000 offset by a credit relating to exceptional input vat recovered £1117000
exceptional costs in the period ended 28th march 2013 related to professional fees arising on the share restructure completed in march 
2013 £1468000 costs relating to the acquisition of 100 of the share capital of farm away ltd in december 2012 £417000 and costs 
relating to the acquisition of 100 of the share capital of vets4pets limited vets4pets ip  ltd and brand developments limited in march 2013 
£4164000
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
audit of these financial statements 10 –
amounts receivable by the company’s auditors and their associates in respect of
audit of financial statements of subsidiaries pursuant to legislation 147 111
other services pursuant to such legislation 3 3
taxation compliance services 100 114
other tax advisory services – 83
services relating to corporate finance transactions entered into by the company or the group 1238 66
all other services 417 51
1915 428
included within all other services are auditors’ fees associated with the acquisition of vets4pets 
investorspetsathomecom
london stock exchange pets
127
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
4 colleague numbers and costs
the average number of persons employed fulltime equivalents by the group including managers and directors during the period analysed by 
category was as follows 
number of colleagues
period ended 
27th march 
2014
number
period ended
28th march 
2013
number
sales and distribution 4414 3833
administration 345 311
4759 4144
the aggregate payroll costs of these persons were as follows
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
wages and salaries 109549 92370
social security costs 8512 7137
contributions to defined contribution plans 2866 2074
120927 101581
5 acquisitions of subsidiaries
acquisitions in the period ended 28th march 2013
vets4pets 
the entire share capital of vets4pets limited vets4pets ip  limited and brand developments limited were acquired by pets at home holdings 
limited a subsidiary undertaking for a cash consideration of £47400000 on 27th march 2013 the transaction has been accounted for as 
a business combination in the period of acquisition the subsidiary contributed a net result on 29th march 2012 group revenue would have 
been £606695000 and net profit would have been £23393000 in determining these amounts management has assumed that the fair value 
adjustments that arose on the date of acquisition would have been the same if the acquisition occurred on 29th march 2012
128
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
5 acquisitions of subsidiaries continued
acquisitions in the period ended 28th march 2013 continued
vets4pets continued
effect of acquisition
the acquisition had the following effect on the group’s assets and liabilities
recognised 
values on 
acquisition 
£000
acquiree’s net assets at the acquisition date
property plant and equipment 303
intangible software 251
investment in other financial assets 185
inventories 7
trade and other receivables 2262
cash and cash equivalents 3349
trade and other payables 1133
net identifiable assets and liabilities 5224
consideration paid 
cash price paid 47400
total consideration 47400
goodwill on acquisition 42176
fair value adjustments
the fair value adjustments to fixed assets are in relation to the revaluation of freehold property acquired from its book value to the current 
market value £339000 and an adjustment to fixed assets held on the fixed asset register of the acquired company which are considered by 
management to be obsolete £105000 the adjustment to debtors was made to adjust the bad debt provision in line with the policies applied 
by other group companies creditors have been adjusted to include a provision for onerous leases in line with other group companies
goodwill has arisen on the acquisition due to the existence of expected synergies from combining operations 
acquisition related costs
the group incurred acquisition related costs of £4164000 in the period ended on 28th march 2013 in relation to professional fees and 
transition costs arising upon acquisition and £2308000 relating to costs associated with the integration of the vets4pets business into the 
group in the period ended on 27th march 2014 all such costs have been expensed to the income statement in the relevant period
farm away ltd
on 12th december 2012 the entire share capital of farm away limited trading as rideaway was acquired by pets at home limited a 
subsidiary undertaking for consideration of £6534000 of this consideration £2000000 was deferred and paid in £500000 instalments 
during the subsequent financial period the value of this deferred consideration was not contingent this transaction has been accounted for as 
a business combination in the four months to 28th march 2013 the subsidiary contributed a net result of £192000 to the consolidated net 
result for the period if the acquisition had occurred on 29th march 2012 group revenue would have been £602804000 and net profit would 
have been £21177000 in determining these amounts management has assumed that the fair value adjustments that arose on the date of 
acquisition would have been the same if the acquisition occurred on 29th march 2012
investorspetsathomecom
london stock exchange pets
129
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
5 acquisitions of subsidiaries continued
acquisitions in the period ended 28th march 2013 continued
farm away ltd continued
effect of acquisition
the acquisition had the following effect on the group’s assets and liabilities
recognised 
values on 
acquisition 
£000
acquiree’s net assets at the acquisition date
property plant and equipment 702
inventories 1196
trade and other receivables 78
cash and cash equivalents 1734
trade and other payables 587
net identifiable assets and liabilities 3123
consideration paid 
initial cash price paid 4534
initial cash consideration relating to business combination 4534
deferred consideration at fair value 2000
total consideration 6534
goodwill on acquisition 3411
fair value adjustments
the fair value adjustments to fixed assets are in relation to the revaluation of freehold property acquired from its book value to the current 
market value a fair value adjustment of £107000 to stock was required to introduce a provision for slowmoving stock in line with group 
policies
goodwill has arisen on the acquisition due to the existence of expected synergies from combining operations 
acquisition related costs
the group incurred acquisition related cost of £417000 relating to professional fees and transition costs arising upon acquisition all such 
costs have been expensed to the income statement in the relevant period
companion care services limited
during the period ended 28th march 2013 the group acquired the noncontrolling interest of 10 in the companion care services limited 
subsidiary for consideration of £1390000 settled in full by cash during the period the book value of the assets acquired was considered to be 
equal to the fair values of the assets of £10000 as there was no change in control as a result of this transaction the difference between the 
fair value of the net assets acquired and the consideration of £1380000 has been recognised directly in retained earnings
pah uk midco limited formerly kkr my best friend uk midco limited
during the period ended 28th march 2013 the group acquired the noncontrolling interest in the pah uk midco limited formerly kkr my best 
friend uk midco limited subsidiary for consideration of £7685000 settled in full by cash during that period the book value of the assets 
acquired was considered to be equal to the fair values of the assets of £nil as there was no change in control as a result of this transaction the 
difference between the fair value of the net assets acquired and consideration of £7685000 has been recognised directly in retained earnings 
the income statement and balance sheet for pah uk midco limited is consolidated in full in both the current and prior periods
130
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
6 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
period ended 
27th march 
2014
underlying
period ended 
27th march 
2014
exceptionals
period ended 
27th march 
2014
after 
exceptionals
period ended 
28th march 
2013
underlying
period ended 
28th march 
2013
exceptionals
period ended 
28th march
 2013
after 
exceptionals
profit attributable to equity shareholders of the 
parent £000s 38565 25017 13548 30831 10298 20533
less pec dividend transferred from retained 
earnings 37646 – 37646 46010 – 46010
919 25017 24098 15179 10298 25477
basic weighted average number of shares 175053425 175053425 175053425 129804683 129804683 129804683
dilutive potential ordinary shares 71360 71360 71360 – – –
diluted weighted average number of shares 175124785 175124785 175124785 129804683 129804683 129804683
basic earnings per share £001 £014 £014 £012 £008 £020
diluted earnings per share £001 £014 £014 £012 £008 £020
7 finance expense
recognised in the income statement
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
bank loans 30890 31917
amortisation of loan issue costs 5286 5787
related party loan notes 1349 1612
other interest expense 22 35
total underlying finance expense 37547 39351
exceptional amortisation costs 19158 7459
total exceptional finance expense 19158 7459
total finance expense 56705 46810
exceptional finance expenses in the period ended 27th march 2014 related to £19158000 of accelerated amortisation following the 
repayment of the senior bank facility of £567926000 in that period
exceptional finance expenses in the period ended 28th march 2013 related to £5915000 of accelerated amortisation and £1544000 of 
early repayment costs following the repayment of the subordinated bank loan of £154397000 in that period
investorspetsathomecom
london stock exchange pets
131
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
8 taxation
recognised in the income statement
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
current tax expense
current period 7840 7048
adjustments in respect of prior periods 362 38
current tax expense 8202 7086
deferred tax expensecredit
origination and reversal of temporary differences 234 575
reduction in tax rate 28 5
adjustments in respect of prior periods 493 537
deferred tax expensecredit 755 1107
total tax expense 8957 5979
the corporation tax rate applicable to the group was 23 in the period to 27th march 2014 the march 2013 budget announced that the uk 
corporation tax rate will further reduce to 20 effective from 1st april 2015 in addition to the planned reduction to 21 effective from 1st april 
2014 previously announced in the december 2012 autumn statement these reductions were substantively enacted on 2nd july 2013 the 
deferred tax asset has been calculated based on the rate of 20 substantively enacted at the balance sheet date
deferred tax recognised in other comprehensive income
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
effective portion of changes in fair value of cash flow hedges 159 752
reconciliation of effective tax rate
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
profit for the period 13548 20533
total tax expense 8957 5979
profit excluding taxation 22505 26512
tax using the uk corporation tax rate for the relevant period 2014 23 2013 24 5177 6362
impact of reduction in tax rate on deferred tax balances 28 5
depreciation on expenditure not eligible for tax relief 1094 1132
nondeductible ipo costs – exceptional item 2055 –
other 251 1022
adjustments in respect of prior periods 854 498
total tax expense 8957 5979
the uk corporation tax standard rate for the period was 23 2013 24 the effective tax rate for the period of 26 on underlying profits of 
£522m pre nonrecurring exceptional items differs from the uk corporation tax rate the principal reason for this difference relates to the non
deductibility of depreciation charged on capital expenditure included within the nonrecurring exceptional items are nondeductible transaction 
costs in relation to the ipo process which result in a total effective tax rate for the period of 40  
132
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
9 property  plant and equipment 
freehold 
property 
£000
short 
leasehold 
property 
£000
fixtures 
fittings 
tools and 
equipment 
£000
motor 
vehicles 
£000
total 
£000
cost
balance at 28th march 2013 1444 28598 99860 9 129911
additions 1064 5484 21262 – 27810
disposals – 1252 19264 9 20525
balance at 27th march 2014 2508 32830 101858 – 137196
depreciation and impairment 
balance at 28th march 2013 49 6144 39096 – 45289
depreciation charge for the period 30 2454 15569 – 18053
disposals – 618 19156 – 19774
balance at 27th march 2014 79 7980 35509 – 43568
net book value
at 28th march 2013 1395 22454 60764 9 84622
at 27th march 2014 2429 24850 66349 – 93628
during the period to 27th march 2014 the group implemented a new accounting system on implementation the group took the opportunity to 
cleanse the fixed asset register of £196m of fully depreciated assets
10 intangible assets 
goodwill
£000
software
£000
total
£000
cost
balance at 28th march 2013 952032 6174 958206
additions – 2171 2171
balance at 27th march 2014 952032 8345 960377
amortisation
balance at 28th march 2013 – 3202 3202
amortisation for the period – 1937 1937
balance at 27th march 2014 – 5139 5139
net book value
at 28th march 2013 952032 2972 955004
at 27th march 2014 952032 3206 955238
amortisation and impairment charge
the amortisation charge is recognised in total in operating expenses within the income statement
investorspetsathomecom
london stock exchange pets
133
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
10 intangible assets continued
impairment testing
cashgenerating units “cgus” within the group are considered to be the body of stores and website as disclosed in note 2 the group is 
deemed to have one overall group of cgus as follows
goodwill
at 27th march 
2014
£000
at 28th march 
2013
£000
pets at home group 952032 952032
the recoverable amount of the cgu group has been calculated with reference to its value in use the key assumptions of this calculation are 
shown below
period ended 
27th march 
2014
period ended 
28th march 
2013
period on which management approved forecasts are based years 3 3
growth rate applied beyond approved forecast period 3 3
discount rate pretax 8 9
the goodwill is considered to have an indefinite useful life and the recoverable amount is determined based on ‘valueinuse’ calculations these 
calculations use pretax cash flow projections based on a three year business plan approved by the board these projections are based on all 
available information and growth rates do not exceed growth rates achieved in prior periods 
the discount rate was estimated based on past experience and industry average weighted average cost of capital management has assumed a 
growth rate projection beyond the three year period based on inflationary increases
the total recoverable amount in respect of goodwill for the cgu group as assessed by the managers using the above assumptions is greater 
than the carrying amount and therefore no impairment charge has been booked in each period the managers consider that it is not reasonably 
possible for the assumptions to change so significantly as to eliminate the excess
11 investments in subsidiaries
company
investment in 
subsidiaries 
£000
at 28th march 2013 –
additions 936179
at 27th march 2014 936179
134
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
11 investments in subsidiaries continued
group 
details of the principal subsidiary undertakings are as follows
holding
country of 
incorporation principal activity
class of
shares held
at 
27th 
march 
2014

at 
28th 
march 
2013

pets at home no1 limited direct united kingdom investment holding company ordinary 100 –
pah lux sarl formerly kkr my best 
friend lux sarl
indirect luxembourg investment holding company ordinary – 100
pah international limited formerly kkr 
my best friend cayman limited
indirect cayman islands investment holding company ordinary – 100
pah uk finco limited formerly kkr my 
best friend uk finco limited
indirect united kingdom investment holding company ordinary – 100
pah retail limited formerly kkr my best 
friend uk interco limited
indirect united kingdom investment holding company ordinary 100 100
pah uk midco limited formerly kkr my 
best friend uk midco limited
indirect united kingdom investment holding company ordinary 100 100
pah uk holdco limited formerly kkr my 
best friend uk holdco limited
indirect united kingdom investment holding company ordinary 100 100
pah uk bidco limited formerly kkr my 
best friend uk bidco limited
indirect united kingdom investment holding company ordinary 100 100
pets at home interco limited 
formerly pets at home group limited
indirect united kingdom investment holding company ordinary 100 100
pets at home midco limited indirect united kingdom investment holding company ordinary 100 100
pets at home retail limited indirect united kingdom investment holding company ordinary 100 100
pah intermediate holdings limited indirect united kingdom investment holding company ordinary 100 100
pah investments limited indirect united kingdom investment holding company ordinary 100 100
pets at home holdings limited indirect united kingdom investment holding company ordinary 100 100
pets at home superstores limited indirect united kingdom investment holding company ordinary 100 100
pets at home limited indirect united kingdom pet product retailing ordinary 100 100
pets at home financial services limited indirect united kingdom asset leasing company ordinary 100 100
pets at home asia limited indirect hong kong group global sourcing company ordinary 100 100
farm away limited indirect united kingdom investment holding company ordinary 100 100
rideaway york limited indirect united kingdom equestrian product retailing ordinary 100 100
pets at home pty indirect australia brand name holder ordinary 100 100
vets4pets ip  limited indirect guernsey support office services ordinary 100 100
companion care services limited indirect united kingdom veterinary services ordinary 100 100
vets4pets limited indirect guernsey veterinary services ordinary 100 100
brand development limited indirect guernsey support office services ordinary 100 100
pet investments ltd indirect united kingdom veterinary services ordinary 100 100
vets4pets holdings limited indirect guernsey veterinary services ordinary 100 100
vets4pets services limited indirect united kingdom veterinary services ordinary 100 100
vets4pets uk limited indirect united kingdom veterinary services ordinary 100 100
vets4pets veterinary group limited indirect united kingdom veterinary services ordinary 100 100
les boues limited indirect jersey investment holding company ordinary 100 100
pets at home vets group limited indirect united kingdom investment holding company ordinary 100 –
not included in the above list are eight dormant entities in which pets at home group plc has a 100 indirect shareholding
investorspetsathomecom
london stock exchange pets
135
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
12 inventories
at 27th march 
2014
£000
at 28th march 
2013
£000
finished goods 46116 42056
the cost of inventories recognised as an expense and included in ‘cost of sales’ is £313141000 period to 28th march 2013 
£268451000 
at 27th march 2014 the inventory provision amounted to £2029000 as at 28th march 2013 £1671000 
in the period ended 27th march 2014 the value of inventory written off to the income statement amounted to £6140000 period to 28th 
march 2013 £5696000
13 deferred tax assets and liabilities 
recognised deferred tax assets and liabilities 
deferred tax assets and liabilities are attributable to the following
at 27th march 
2014
assets 
£000
at 27th march 
2014
liabilities
£000
at 27th march 
2014
total
£000
at 28th march 
2013
assets
£000
at 28th march 
2013
liabilities
£000
at 28th march 
2013
total
£000
property plant and equipment – 1592 1592 – 1993 1993
inventories – 13 13 – 103 103
financial assets 223 – 223 435 – 435
financial liabilities – 133 133 – 186 186
other 3439 1879 1560 3119 313 2806
net tax assetsliabilities 3662 3617 45 3554 2595 959
movement in deferred tax during the period
28th march 
2013
£000
recognised
in income
£000
recognised
in equity
£000
27th march 
2014
£000
property plant and equipment 1993 401 – 1592
inventories 103 90 – 13
net financial assets 249 – 159 90
other 2806 1246 – 1560
959 755 159 45
movement in deferred tax during the period
29th march 
2012
£000
recognised
in income
£000
recognised
in equity
£000
28th march 
2013
£000
property plant and equipment 3141 1148 – 1993
inventories 170 67 – 103
financial assets 1001 – 752 249
other 2914 108 – 2806
604 1107 752 959
the rate used to calculate deferred tax assets and liabilities has been disclosed in note 8
136
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
14 other financial assets and liabilities
at 27th march 
2014
£000
at 28th march 
2013
£000
noncurrent assets
investments 5957 3727
interest rate swaps 662 –
6619 3727
investments are availableforsale financial assets which represent the fair value of nonequity share capital and loans provided to veterinary 
practice companies trading under the companion care and vets4pets brands in which the group’s share interest is nonparticipatory these 
investments are classified as availableforsale and accounted for as nonderivative financial assets at fair value
the share capital of the veterinary practice companies is split into either ‘a’ ordinary shares and ‘b’ ordinary shares or preference shares and 
ordinary shares under the terms of the agreements between the veterinary practices and companion care services limited a subsidiary 
of the group the ‘b’ ordinary sharesordinary shares which are held by companion care services limited are not entitled to any profits or 
dividends or any surplus on winding up or disposal although they are entitled to appoint directors to the board and carry the same shareholder 
voting rights as ‘a’ ordinarypreference shareholders any operational decisions require the agreement of the joint venture partner
under the terms of the agreements between the veterinary practices and vets4pets limited a subsidiary of the group the ‘b’ shares which are 
held by vets4pets limited are not entitled to any profits or dividends and on winding up or other return of capital the holders of the ‘b’ shares 
are entitled in priority to the holders of the ‘a’ shares to receive £0001 in respect of each ‘b’ share held but subject thereto they are not 
entitled to receive any other return of capital which shall be applied for the holders of the ‘a’ shares they are entitled to appoint ‘b’ directors to 
the board and carry the same shareholder voting rights as ‘a’ shareholders 
at 27th march 
2014
£000
at 28th march 
2013
£000
current assets
financial assets held for trading 
forward exchange contracts – 811
at 27th march 
2014
£000
at 28th march 
2013
£000
current liabilities
financial liabilities held for trading
interest rate swaps – 1894
forward exchange contracts 1113 –
1113 1894
15 trade and other receivables
group company
at 27th march 
2014
£000
at 28th march 
2013
£000
at 27th march 
2014
£000
trade receivables 5761 3298 –
other receivables note 26 16479 7628 –
amounts owed by group undertakings – – 565441
employee loans – 902 –
prepayments and accrued income 19919 19940 –
related party loan note 26 – 2273 –
total 42159 34041 565441
all balances are included within current assets
investorspetsathomecom
london stock exchange pets
137
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
16 cash and cash equivalents
group company
at 27th march 
2014
£000
at 28th march 
2013
£000
at 27th march 
2014
£000
cash and cash equivalents 90823 31593 22829
17 other interestbearing loans and borrowings
group
at 27th march 
2014
£000
at 28th march 
2013
£000
noncurrent liabilities
secured bank loans 319855 413927
current liabilities
current portion of secured bank loans – 3708
deferred consideration on acquisition – 2000
– 5708
total liabilities
secured bank loans 319855 417635
deferred consideration on acquisition – 2000
319855 419635
terms and debt repayment schedule 
currency
nominal
interest rate
year of
maturity
face
value
27th march 
2014
£000
carrying 
amount
27th march 
2014 
£000
face
value
28th march 
2013
£000
carrying
amount
28th march 
2013 
£000
senior bank loans gbp libor 3–5 2018 – – 436635 417635
senior finance bank loans gbp libor 2–225 2019–2020 325000 319855 – –
deferred consideration on acquisition gbp 35 2013 – – 2000 2000
325000 319855 438635 419635
included in deferred consideration on acquisition at 28th march 2013 is £2000000 due to the vendors of farm away limited the amount was 
settled in full in the period to 27th march 2014
included within the carrying value of senior and subordinated bank loans are issue costs of £51m period to 28th march 2013 £190m the 
group has an undrawn revolving credit facility of £296m period to 28th march 2013 £270m which expires on 17th march 2019
all bank borrowings are secured via fixed charges over the head office freehold property the distribution centre leasehold property and any plant 
and machinery owned by the group and also via a floating charge over the other assets of the group the senior bank loans bear interest at 
libor plus a margin currently varying between 200 and 225 with the margin decreasing as the group’s leverage defined as total net debt 
to consolidated ebitda decreases the senior bank loans are due for repayment at various dates up to 17th march 2020
in july 2012 the business repaid the subordinated loan replacing it with a further tranche of the senior loan facility which significantly reduced 
the interest charge of the group the business subsequently received approval from existing senior lenders to draw down a further £135m 
tranche of the senior loan facility this refinancing was completed in march 2013 with the loan being drawn down on 8th april 2013 
in march 2014 the business repaid the senior bank loans replacing them with a new senior finance facility which has significantly reduced the 
interest charge of the group the new senior bank facility was drawn down on 17th march 2014 the new senior bank facility is held by the 
company
138
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
17 other interestbearing loans and borrowings continued
the pets at home group has entered into fixed rate interest rate swap agreements over a total of £2918m of the senior facility borrowings at a 
fixed rate of 074 and a further fixed rate interest rate swap over a total of £251m at a fixed rate of 0655 period ended 28th march 2013 
£3173m of the senior facility borrowings at a fixed rate of 074 and £830m at a fixed rate of 0655 both swaps expire on 30th march 
2016 the hedges are structured to hedge at least 70 of the outstanding debt  
the analysis of repayments on the combined loans is as follows
at 27th march 
2014
£000
at 28th march 
2013
£000
within one year or repayable on demand – 5708
between one and two years 5000 12409
between two and five years 85000 291591
after five years 235000 128927
325000 438635
issue costs 5145 19000
319855 419635
the combined loans at 27th march 2014 are held by the company
18 trade and other payables
group company
at 27th march 
2014
£000
at 28th march 
2013
£000
at 27th march 
2014
£000
current
trade payables 79005 52199 –
accruals and deferred income 49898 35094 14797
other payables including tax  social security 17245 10990 –
corporation tax 3399 4549 –
amounts owed to related party – 1467 –
149547 104299 14797
noncurrent
related party loan notes – 21799 –
deferred income 31068 28168 –
31068 49967 –
the group held related party loan notes of £nil period to 28th march 2013 £218m due to colleagues and former colleagues of pets at home 
limited who are part of the management team the loans incurred interest at 8 per annum and the interest was capitalised until the loans 
were repaid on flotation of the group and interest of £nil period to 28th march 2013 £45m was included in the balance
19 provisions
dilapidation 
provision
£000
closed stores 
provision 
£000
total
£000
balance at 28th march 2013 219 2075 2294
provisions used during the period 99 962 1061
provisions made during the period 810 253 1063
balance at 27th march 2014 930 1366 2296
investorspetsathomecom
london stock exchange pets
139
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
19 provisions continued
at 27th march 
2014
£000
at 28th march 
2013
£000
current 461 380
noncurrent 1835 1914
2296 2294
 the closed stores provision relates to the rent and rates payable on sublet or vacant stores a provision is made where the rent receivable on 
the properties is less than the rent payable or where management considers there to be a risk on the sublet the timing of the utilisation of the 
above provisions is variable dependent upon the lease expiry dates of the properties concerned which vary between 10 to 15 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
the company did not hold any provisions at 27th march 2014
20 capital and reserves
group
share capital
share 
capital
number
share 
capital
£000
share
 premium
£000
additional 
paid in capital
£000
at 29th march 2012 127660225 1277 284050 565331
issue of 38246740 ordinary shares of £001 each 38246740 382 7442 –
issue of additional paid in capital – – – 1339
interest accrued on additional paid in capital – – – 46010
at 28th march 2013 165906965 1659 291492 612680
interest accrued on additional paid in capital – – – 37646
issue of 334093035 ordinary shares of £001 each 334093035 3341 815187 344321
share issue costs – – 26202 –
redemption of additional paid in capital – – – 306005
on issue at period end 500000000 5000 1080477 –
company
share capital
27th march 
2014
£000
share premium
27th march 
2014
£000
at beginning of period – –
issue of 500000000 ordinary shares of £001 each 5000 1106679
share issue costs – 26202
on issue at period end 5000 1080477
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 
additional paid in capital
the additional paid in capital represents preferred equity certificates “pecs” issued by pah lux sarl and is equal to the nominal value plus 
accrued return 
as part of the initial public offering the pecs were either exchanged for shares in pets at home group plc or ultimately exchanged for cash
140
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
20 capital and reserves continued
additional paid in capital continued
the pecs had a nominal value of £100 each in accordance with ias 32 ‘financial instruments presentation’ the pecs were classified as 
equity instruments for the following reasons i the terms of the pecs state that the pec coupon shall be made at pah lux sarl’s sole 
option either in cash in new pecs or in shares issued by pah lux sarl with a nominal value equal to the pec coupon and ii the terms 
provide a mandatory redemption clause which required pah lux sarl to redeem the outstanding pecs on the redemption date this mandatory 
redemption was subject to the provision of a ‘conversion option’ clause which provided an option for pah lux sarl to pay the pecs in shares of 
the company 
the pecs accrue a coupon of 8 per annum payable provided that i pah lux sarl could make the payment without becoming insolvent or 
bankrupt ii pah lux sarl would not have or increase a deficit balance in its retained earnings after making such payments and iii the 
payment could be made by pah lux sarl out of funds net of tax resulting from specific income
in the period prior to the initial public offering the outstanding pec certificates attracted accumulated return of £376m 2013 £460m 
representing a return per certificate of £009 2013 £010
on 13th april 2013 £1304m of pec notes and associated coupon were ultimately exchanged for cash as part of the initial public offering 
transaction on 17th march 2014 £3443m of pec certificates and associated outstanding coupon were exchanged for 140539184 shares 
in the company at a fair value of £245 per share the remaining £1756m of pec certificates issued together with the associated outstanding 
coupon were redeemed for cash 
translation reserve
the translation reserve comprises all foreign exchange differences arising since 21st november 2011 the date of incorporation of pets at home 
asia limited where the functional currency differs from that of the rest of the group
cash flow hedging reserve
the 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
other comprehensive income
27th march 2014
translation 
reserve 
£000
cash flow 
hedging
 reserve 
£000
total other 
comprehensive 
income 
£000
other comprehensive income 5 – 5
cash flow hedges – reclassified to profit and loss – 811 811
effective portion of changes in fair value of cash flow hedges – 1442 1442
deferred tax on changes in fair value of cash flow hedges – 159 159
total other comprehensive income 5 472 477
28th march 2013
translation 
reserve 
£000
cash flow 
hedging
 reserve 
£000
total other 
comprehensive 
income 
£000
other comprehensive income 1 – 1
cash flow hedges – reclassified to profit and loss – 110 110
effective portion of changes in fair value of cash flow hedges – 2978 2978
deferred tax on changes in fair value of cash flow hedges – 752 752
total other comprehensive income 1 2336 2335
investorspetsathomecom
london stock exchange pets
141
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
21 financial instruments
financial risk management
the pets at home 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 is carried out by the pets at home group treasury department under policies approved by the board the board has overall 
responsibility for the establishment and oversight of the group’s risk management framework the board provides written principles 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 nonderivative financial instruments and investment of excess liquidity 
the main objectives of the pets at home group treasury department 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
 to control banking costs and service levels
market risk
i foreign currency risk 
the pets at home group sources a significant level of purchases in us dollars and monitors its foreign currency requirements through short 
medium and longterm cash forecasting the value of purchases in us dollars has increased significantly over the last three years and the risk 
management policy has changed in line with this increased risk 
at 27th march 2014 the pets at home group’s policy is to hedge between 75 and 90 of the forecasted foreign exchange transactions on a 
rolling 10 to 12 month basis 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 forecasted 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
the company does not have exposure to foreign currency risk
27th march 2014
euro
£000
us dollar
£000
hkd
£000
total
£000
cash and cash equivalents 18 3012 2 3032
trade payables 186 3271 – 3457
forward exchange contracts 22 1091 – 1113
balance sheet exposure 190 1350 2 1538
28th march 2013
euro
£000
us dollar
£000
hkd
£000
total
£000
cash and cash equivalents 67 6560 2 6629
trade payables 252 5007 – 5259
forward exchange contracts 43 768 – 811
balance sheet exposure 142 2321 2 2181
142
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
21 financial instruments continued
market risk continued
i foreign currency risk continued
sensitivity analysis
a 5 weakening of the following currencies against the pound sterling at the period end date in both years would have increaseddecreased 
profit or loss or equity by the amounts shown below 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 other exchange rates and interest rates remain constant 
equity profit or loss
27th march 
2014
£000
28th march 
2013
£000
27th march 
2014
£000
28th march 
2013
£000
 55 38 13 78
€ 1 2 8 9
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
ii interest rate risk 
cash flow and fair value interest rate risk
the pets at home group’s interest rate risk arises from longterm borrowings as at 27th march 2014 the group has a drawn down senior facility 
with a face value totalling £3250m and an undrawn revolving credit facility of £296m which expires on 17th march 2019 the pets at home 
group’s borrowings as at 27th march 2014 incur interest at varying rates between 200 and 225 plus libor which exposes the group to 
cash flow interest rate risk the analysis of loan repayments is detailed in note 17
the pets at home group’s policy with regard to interest rate risk is to hedge the appropriate level of borrowings by entering into fixed rate 
agreements the pets at home group has entered into fixed rate interest rate swap agreements over a total of £2918m of the senior facility 
borrowings at the balance sheet date at a fixed rate of 074 and a further fixed rate interest rate swap was taken out over a total of £251m 
at the balance sheet date at a fixed rate of 0655 both swaps expire on 30th march 2016 the hedges are structured to hedge at least 70 
of the outstanding debt 
profile
at the balance sheet date the interest rate profile of the group’s interestbearing financial instruments was
group company
book value
at 27th march 
2014
£000
book value
at 28th march 
2013
£000
book value
at 27th march 
2014
£000
fixed rate instruments
financial liabilities 316900 317200 316900
variable rate instruments
financial liabilities 2955 121435 2955
total financial liabilities 319855 438635 319855
all loans bear a variable rate of interest based on libor pets at home group policy is to hedge at least 70 of the loan to ensure a fixed 
rate therefore designated above is the portion of the loan hedged by a fixed rate interest rate swap and the remaining unhedged portion is 
designated as variable rate 
investorspetsathomecom
london stock exchange pets
143
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
21 financial instruments continued
market risk continued
ii interest rate risk continued
sensitivity analysis 
a change of 50 basis points in interest rates at the period end date would have increaseddecreased equity and profit or loss by the amounts 
shown below 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 instrument 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 comparative period
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
equity
increase 1584 1586
decrease 1584 1586
profit or loss
increase 1 597
decrease 1 597
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 and investment securities
credit risk also arises from cash and cash equivalents derivative financial instruments and deposits with banks and financial institutions the 
group ensure that the banks used for the financing of the loan 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 veterinary practice companies in which it holds an 
investment further details of these guarantees are disclosed in note 26 the performance of the 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
144
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
21 financial instruments continued
liquidity risk continued
the following are the contractual maturities of financial liabilities including estimated interest payments
at 27th march 2014
carrying 
amount 
£000
contractual 
cash flows 
£000
1 year 
or less 
£000
1 to
2years 
£000
2 to 
5years 
£000
5 years 
and over 
£000
nonderivative financial liabilities
secured bank loans note 17 – – – – – –
secured bank loans note 17 319855 372310 8653 13595 108643 241419
deferred consideration on acquisition note 17 – – – – – –
trade payables note 18 79005 79005 79005 – – –
derivative financial liabilities 
forward exchange contracts used for hedging
outflow note 14 1113 1113 1113 – – –
inflow note 14 – – – – – –
interest rate swaps used for hedging
outflow note 14 – – – – – –
inflow note 14 – – – – – –
399973 452428 88771 13595 108643 241419
28th march 2013
carrying 
amount 
£000
contractual 
cash flows 
£000
1 year 
or less 
£000
1 to
 2 years 
£000
2 to 
 5 years 
£000
5 years 
and over 
£000
nonderivative financial liabilities
secured bank loans note 17 417635 528819 25852 34113 468854 –
secured bank loans note 17 – – – – – –
deferred consideration on acquisition note 17 2000 2000 2000 – – –
trade payables note 18 52199 52199 52199 – – –
derivative financial liabilities 
forward exchange contracts used for hedging
outflow note 14 – – – – – –
inflow note 14 – – – – – –
interest rate swaps used for hedging
outflow note 14 1894 2141 816 790 535 –
inflow note 14 – – – – – –
473728 585159 80867 34903 469389 –
company
27th march 2014
carrying 
amount 
£000
contractual 
cash flows 
£000
1 year 
or less 
£000
1 to
2 years 
£000
2 to 
5 years 
£000
5 years 
and over 
£000
nonderivative financial liabilities
secured bank loans note 17 319855 372310 8653 13595 108643 241419
investorspetsathomecom
london stock exchange pets
145
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
21 financial instruments continued
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
at 27th march 2014
carrying 
amount 
£000
contractual 
cash flows 
£000
1 year 
or less 
£000
1 to
2 years 
£000
2 to 
5y ears 
£000
5 years 
and over 
£000
interest rate swaps
assets note 14 662 890 354 1244 – –
liabilities note 14 – – – – – –
forward exchange contracts
assets note 14 – – – – – –
liabilities note 14 1113 1113 1113 – – –
451 223 1467 1244 – –
28th march 2013
carrying 
amount 
£000
contractual 
cash flows 
£000
1 year 
or less 
£000
1 to
2 years 
£000
2 to 
5 years 
£000
5 years 
and over 
£000
interest rate swaps
assets note 14 – – – – – –
liabilities note 14 1894 2141 816 790 535 –
forward exchange contracts
assets note 14 811 811 811 – – –
liabilities note 14 – – – – – –
1083 1330 5 790 535 –
company
27th march 2014
carrying 
amount 
£000
contractual 
cash flows 
£000
1 year 
or less 
£000
1 to
2 years 
£000
2 to 
5 years 
£000
5 years 
and over 
£000
interest rate swaps
assets note 14 662 890 354 1244 – –
liabilities note 14 – – – – – –
662 890 354 1244 – –
fair values of financial instruments
investments in equity securities
the fair value of investments is considered to be their carrying value as the impact of discounting future cash flows has been assessed as not 
material and the investment is nonparticipatory
trade and other payables and receivables
the fair value of these items is 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 estimated as its carrying amount where the cash is repayable on demand where it is not 
repayable on demand such as term deposits then the fair value is estimated at the present value of future cash flows discounted at the 
market rate of interest at the balance sheet date
146
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
21 financial instruments continued
fair values of financial instruments continued
longterm and shortterm borrowings 
the fair value of bank loans and other loans approximates its carrying value as it has an interest rate based on libor
shortterm deposits
the fair value of shortterm deposits is considered to be the 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 value of interest rate swap contracts and forward exchange contracts is calculated by management based on external valuations 
received from the group’s bankers and is based on forward exchange rates and anticipated future interest yield respectively
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
carrying 
amount
27th march
2014
£000
fair 
value
27th march
2014
£000
carrying 
amount
28th march 
2013
£000
fair 
value
28th march
2013
£000
financial assets held for trading including all derivatives 
forward exchange contracts note 14 – – 811 811
interest rate swaps note 14 662 662 – –
available for sale financial assets note 14
investment in nonequity share capital and loans 5957 5957 3727 3727
total financial assets at fair value through profit or loss 6619 6619 4538 4538
loans and receivables
cash and cash equivalents note 16 90823 90823 31593 31593
trade and other receivables note 15 42159 42159 34041 34041
total loans and receivables 132982 132982 65634 65634
total financial assets 139601 139601 70172 70172
financial liabilities held for trading including all derivatives
forward exchange contracts note 14 1113 1113 – –
interest rate swaps note 14 – – 1894 1894
total financial liabilities at fair value through profit or loss 1113 1113 1894 1894
financial liabilities measured at amortised cost
other interestbearing loans and borrowings note 17 319855 319855 419635 419635
trade and other payables note 18 180615 180615 154266 163943
total financial liabilities measured at amortised cost 500470 500470 573901 583578
total financial liabilities 501583 501583 575795 585472
total financial instruments 361982 361982 505623 515300
investorspetsathomecom
london stock exchange pets
147
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
21 financial instruments continued
fair values of financial instruments continued
company
carrying 
amount
 27th march 
2014
£000
fair 
value
27th march 
2014
£000
financial assets held for trading including all derivatives 
forward exchange contracts note 14 – –
interest rate swaps note 14 662 662
total financial assets at fair value through profit or loss 662 662
loans and receivables
cash and cash equivalents note 16 22829 22829
trade and other receivables note 15 565441 565441
total loans and receivables 588270 588270
total financial assets 588932 588932
financial liabilities measured at amortised cost
other interestbearing loans and borrowings note 17 319855 319855
trade and other payables note 18 14797 14797
total financial liabilities 334652 334652
total financial instruments 254280 254280
fair value hierarchy
the table below analyses financial instruments measured at fair value into a fair value hierarchy based on the valuation technique used to 
determine fair value 
 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 ie as prices 
or indirectly ie derived from prices
 level 3 inputs for the asset or liability that are not based on observable market data unobservable inputs
group
27th march 2014 
level 1 
£000
level 2 
£000
level 3 
£000
total 
£000
available for sale financial assets
investment in equity securities – – 5957 5957
derivative financial assets
forward rate contracts – 1113 – 1113
derivative financial liabilities
interest rate swaps – 662 – 662
 
28th march 2013
level 1 
£000
level 2 
£000
level 3 
£000
total 
£000
available for sale financial assets
investment in equity securities – – 3727 3727
derivative financial assets
forward rate contracts – 811 – 811
derivative financial liabilities
interest rate swaps – 1894 – 1894
148
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
21 financial instruments continued
fair values of financial instruments continued
fair value hierarchy continued
company
27th march 2014 
level 1 
£000
level 2 
£000
level 3 
£000
total 
£000
derivative financial liabilities
interest rate swaps – 662 – 662
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 business 
during the period the group delevered as part of the initial public offering process which brought the group’s leverage into a position 
commensurate with the public market
the funding requirements of the group are met by the utilisation of external borrowings together with available cash as detailed in note 21
a key objective of the group’s capital management is to maintain compliance with the covenants set out in the senior loan agreement and to 
maintain comfortable headroom over and above these requirements 
management has continued to measure and monitor covenant compliance throughout the period and the group has complied with the 
requirements set
22 share based payments
at 27th march 2014 the group has four share award plans all of which are equity settled schemes
1 the coinvest plan cip
on 25th february 2014 the company adopted the coinvest plan cip matching awards under the cip as described in section 1b below 
were made on 17th march 2014 to executive directors and the senior executives by reference to corresponding investment pledges by those 
colleagues 
these matching awards will vest over a period of three years subject to the satisfaction of performance conditions and once vested as to 
performance will become exercisable in equal onethird tranches in years three four and five subject to continued employment with the group 
these awards were granted at nil cost
a eligibility
only the executive directors the senior executives and certain other senior colleagues have been selected to participate in the cip  
b type of awards
colleagues are invited to participate in the cip by making an ‘investment’ or ‘pledge’ of their own shares the “coinvest shares” which can 
include existing lockedin shares or new shares acquired with cash in return for a nil costmatching award over shares the “matching award” 
matching awards will be granted by reference to a ratio not exceeding one matched share for every coinvest share ‘pledged’ matching awards 
under the cip will not form part of a participant’s pensionable earnings and are not transferable other than on death
investorspetsathomecom
london stock exchange pets
149
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
22 share based payments continued
1 the coinvest plan cip continued
c individual limits
the executive directors and the senior executives will pledge coinvest shares with a market value equal to 25 times their annual salary 
other senior colleagues who elect to participate in the cip will pledge coinvest shares with a market value equal to a limit specified by the 
remuneration committee but not exceeding 1 times their annual salary
d performance vesting and performance adjustment
the matching awards granted on 17th march 2014 vest 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 proposed performance conditions are as follows 
 75 of the matching award will be 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 ends on 31st march 2017 if the cagr 
in the company’s eps is 10 then 10 of the total matching award will vest if the cagr in the company’s eps is 175 or more then 
75 of the total matching award will vest vesting will be on a straightline basis between these two points for the avoidance of doubt 
if the cagr in eps is less than 10 over the performance period then the amount of the matching award which will vest under this eps 
performance condition will be nil
 25 of the total matching award will be subject to the company’s total shareholder return “tsr” as compared to the uk general retail 
index over the performance period vesting of 625 of the total matching award will occur for median performance vesting of the 
maximum 25 of the total matching award will occur for upper quartile performance or above vesting will occur on a straightline basis 
between these two points if the company’s tsr performance over the performance period is below median then the amount of the 
matching award which will vest under this tsr performance condition will be nil
 to the extent vested as to performance matching awards will become exercisable in three equal amounts on the third fourth and fifth 
anniversary of 17th march 2014 but subject to continued employment with the group
2 csop
on 25th february 2014 the company adopted the csop  part i of the csop will be 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 were granted on 9th april 2014 these options 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
150
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
22 share based payments continued
2 csop continued
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 himher 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 £30000
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 hisher 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
f part ii
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 £30000 limit and the need to seek hmrc approval for the scheme and subsequent amendments as 
applicable
3 psp
on 25th february 2014 the company adopted the psp  awards under the psp were made on 17th march 2014 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 were granted at nil cost
a eligibility
only the executive directors the senior executives and certain other senior colleagues have been 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 cip 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 cip  csop  saye and sip 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
investorspetsathomecom
london stock exchange pets
151
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
22 share based payments continued
3 psp continued
e individual limits
the aggregate market value of shares comprised in awards granted to a colleague under the psp 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 will be 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
f performance
for awards granted on or in connection with admission the performance conditions will be the same as for the cip outlined in section 1d 
above
4 saye
on 25th february 2014 the company adopted the saye which is expected to be registered with and selfcertified with hmrc by 6th july 
2014 the rules of the saye are approved under schedule 3 to the income tax earnings and pensions act 2003 and provide for the grant 
of tax approved options it is proposed that invitations under the saye will be made as soon as practicable following the announcement of the 
company’s results postadmission it is currently proposed that invitations will be made to eligible colleagues including the executive directors 
and senior executives for the grant of options under the saye by the end of the calendar year all of these options will be exercisable in normal 
circumstances between the third and tenth anniversary of the date of grant it is anticipated that these options will be granted with an exercise 
price to be agreed with hmrc which will be no less than 80 of the market value of the shares on the date of issue of the invitations
a eligibility
all colleagues and fulltime 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 will be 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 nonexecutive directors are not eligible to 
participate in the saye
b issue of invitations
invitations to participate in the saye may be made during the period of 42 days from and including the date of admission and thereafter 
in 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 exceptional 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 andor 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
152
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
22 share based payments continued
4 saye continued
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 either three or five years the 
maximum amount which an employee is permitted to contribute under saye contracts is £250 per month increasing to £500 per month from  
6th april 2014 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 cip  csop  psp and sip 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 reconstruction or voluntary windingup of the company
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 on 17th march 2014 
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 
zerocoupon uk government bonds with a life equal to this expected life
options were valued using a black–scholes optionpricing model for the nonmarket based eps element performance conditions and a monte 
carlo simulation for the marketbased 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 windingup of the company
the key assumptions used in the fair value of the awards were as follows
at grant date cip psp
share price £245 £245
exercise price £000 £000
expected volatility 30 30
option life years 3 10
expected dividend yield 200 200
risk free interest rate 107 107
weighted average fair value of options granted £206 £206
as both the cip and psp awards have a nil exercise price the risk free rate of return does not have any effect on the estimated fair value and 
therefore is excluded from the above table
investorspetsathomecom
london stock exchange pets
153
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
22 share based payments continued
fair value of share awards continued
movements in awards under share based payment schemes
cip
000
psp
000
outstanding at start of year – –
granted 2454 304
forfeited – –
exercised – –
lapsed – –
outstanding at end of year 2454 304
the group income statement charge recognised in respect of share based payments for the current period is £31368
23 operating leases
noncancellable operating lease rentals are payable as follows 
land and buildings other
at 27th march 
2014
£000
at 28th march 
2013
£000
at 27th march 
2014
£000
at 28th march 
2013
£000
less than one year 65320 60539 2634 1131
between one and five years 252770 234583 3922 1335
more than five years 271260 288763 65 27
589350 583885 6621 2493
land and buildings relate to the hire of stores under operating leases no lease is considered individually significant
during the period £65300000 was recognised as an expense in the income statement in respect of operating leases period to 28th march 
2013 £60045000
the company does not have any operating leases
sublease income
the group has a number of leases on properties from which it no longer trades these properties are often sublet to third parties at contracted 
rates the income is recognised within selling and distribution expenses in line with the rents payable as set out in the rental agreements and 
the balance is held in deferred income
sublets
27th march 
2014
£000
sublets
28th march 
2013
£000
less than one year 868 437
between one and five years 2920 1597
more than five years 2335 1768
6123 3802
24 commitments
capital commitments
at 27th march 2014 the group is committed to incur capital expenditure of £2883000 at 28th march 2013 £1095000 capital 
commitments predominately relate to the costs to fit out new pets at home stores and investment in new it systems
154
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341002     17 july 2014 323 pm     proof 9
25 contingencies
veterinary practice
provisions are maintained by the group where necessary against certain balances held with the veterinary practice subsidiaries 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 nonparticipatory share capital at the end of the period the total amount of bank overdrafts and loans guaranteed by the 
group amounted to £5750000 period to 28th march 2013 £2500000 
a further £1500000 period to 28th march 2013 £1500000 is guaranteed by the group in respect of bacs payments made by the 
veterinary practice companies 
26 related parties
goods and services
one nonexecutive director was paid a consultation fee in the period of £156000 period to 28th march 2013 £156000
kohlberg kravis roberts  co lp  received a management fee in the period of £1220000 period to 28th march 2013 £1196000 which 
includes the provision of nonexecutive director services and expenses recharged 
kohlberg kravis roberts  co lp  also received fees of £8685105 and expenses of £113735 period to 28th march 2013 £nil relating to a 
termination payment and transaction fees following the termination of the advisory services agreement dated 19th march 2010 upon admission 
of the pets at home group to the london stock exchange on 17th march 2014
kkr capital markets llc received fees of £600000 period to 28th march 2013 £1694000 relating to professional services associated 
with debt financing following the refinancing of the pets at home group in april 2013 £1775000 period to 28th march 2013 £nil relating to 
professional services associated with the debt refinancing of the pets at home group in march 2014 £1757307 period to 28th march 2013 
£nil relating to fees in relation to the pets at home group plc ipo and £200000 period to 28th march 2013 £nil relating to professional 
services associated with the arrangement of loan agreements which companion care management services limited became party to in march 
2014
kkr capstone received a management fee in the period of £nil period to 28th march 2013 £102000
kkr capstone uses the name “kkr” under licence but for the avoidance of doubt neither kkr  co lp  nor its affiliates owns or controls kkr 
capstone or kkr capstone’s affiliates
transactions with key management personnel
the compensation of key management personnel is as follows
27th march 
2014
£000
28th march 
2013
£000
key management emoluments including social security costs 3272 1749
company contributions to money purchase pension plans 98 85
3370 1834
included within trade and other receivables are related party loans comprising unsecured loans advanced to colleagues of £nil period to  
28th march 2013 £1573000 who held unallocated shares in manco 2 limited relating to the employee investment scheme 
also included within the related party loans is a balance with pah international limited of £nil period to 28th march 2013 £700000 which 
was ultimately due from a director of the company this loan was unsecured and incurred interest at a rate of 8 per annum
the additional paid in capital of pah lux sarl represented a related party transaction with investors in the group prior to the reorganisation as 
described in note 1 see note 20 for details of transactions relating to the additional paid in capital during the year
investorspetsathomecom
london stock exchange pets
155
financial statements
independent auditors’ report 106
consolidated income statement 108
consolidated statement of  
comprehensive income 108
consolidated balance sheet 109
consolidated statement of  
changes in equity 110
consolidated statement of  
cash flows 112
company balance sheet 113
company statement of 
changes in equity 114
company statement of cash flows 115
notes forming part of the  
financial statements 116 2341002     17 july 2014 323 pm     proof 9
notes forming part of the financial statements
continued
26 related parties continued
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 16
the transactions entered into during the period and the balances outstanding at the end of the period are as follows
period ended 
27th march 
2014
£000
period ended 
28th march 
2013
£000
transactions
— fees for services provided to veterinary practices 21610 9304
— rental charges to veterinary practices 5039 3791
balances
— due from veterinary practice companies at end of period included within other receivables 12673 4648
156
pets at home group plc
annual report and accounts for the period ended 27th march 2014
financial statements 2341004    17 july 2014 532 pm    proof 9
advisers 
and contacts
registered office
pets at home group plc  
epsom avenue  
stanley green trading estate  
handforth  
cheshire  
sk9 3rn  
united kingdom
registered number
8885072
investor relations
investorspetsathomecom 
investorrelationspetsathomecouk 
44 0161 486 6688
corporate brokers
goldman sachs international  
peterborough court  
133 fleet street  
london  
ec4a 2bb 
bank of america merrill lynch 
2 king edward street  
london  
ec1a 1hq 
legal advisors
simpson thacher bartlett llp  
citypoint 
one ropemaker street  
london  
ec2y 9hu
auditor
kpmg  
st james square  
manchester  
m2 6ds
registrar
computershare investor services plc  
the pavilions  
bridgwater road  
bristol  
bs99 6zz  2341004    17 july 2014 532 pm    proof 9
pets at home group plc
epsom avenue
stanley green trading estate
handforth
cheshire
sk9 3rn
investorspetsathomecom


Summary:
 2341004    17 july 2014 532 pm    proof 9
pictured our success is driven by our highly engaged 
colleagues who deliver outstanding service to our pet 
customers
chairman’ s 
statement
10
strategic report
overview
pets at home group plc
annual report and accounts for the year ended 27th march 2014 2341004    17 july 2014 532 pm    proof 9
dear shareholder
2014 was an historic year for the business 
culminating in our listing on the premium 
segment of the london stock exchange 
at the same time we delivered record 
financial results successfully executed on 
our growth strategy continued to engage our 
colleagues and pet customers and enhanced 
our governance with an expanded board of 
directors
pets at home is the leader in the highly 
attractive uk pet care market we stand 
uniquely placed as the only uk retailer offering 
a full suite of pet products and services 
across both stores and the internet we offer 
customers a truly differentiated range which 
drives engagement and loyalty in a one stop 
shop environment
during the year we believe we have benefited 
both from positive market dynamics as well 
as the successful execution of our plans 
historically the uk pet care market has 
experienced growth levels above those of the 
overall nonfood sector driven by pet owners’ 
continued demand for innovative premium 
products the increased uptake of pet services 
and the desire for owners to treat and care for 
their pets as one of the family we believe this 
dynamic continues
in the financial year 2014 revenues grew by 
112 to £6654m we experienced another 
year of likeforlike growth at 24 driven by vip 
club success strength in advanced nutrition 
omnichannel and the increasing maturity of  
pet services
nick wood and our executive management 
team have continued to execute our growth 
strategy for the business we are very proud 
to have become the uk’s largest small animal 
veterinary services provider with 277 practices 
operating under the companion care and 
vets4pets brands at year end our groom room 
services expanded at a rapid rate with 42 
salons added to our store portfolio the largest 
expansion we have seen in a single year we 
also opened 32 stores bringing our portfolio 
to 377 larger than the five closest specialist 
competitors combined our success is driven 
by our highly engaged colleagues who deliver 
outstanding service to our pet customers 
this high level of colleague engagement was 
recognised by being awarded the sunday times 
best place to work for large companies  
in 2013
as a public company our vision remains the 
same to be the best pet shop in the world we 
have always sought to deliver superior returns 
to our shareholders through the continued 
growth profitability and cash flows of the 
company at listing we enhanced our corporate 
governance framework with an expansion of the 
board and the appointment of five independent 
nonexecutive directors paul coby tessa 
green amy stirling and paul moody and we 
welcomed dennis millard as deputy chairman 
and senior independent nonexecutive director 
each director has been chosen to bring a 
range of retail public company commercial and 
charitable skills to pets at home brian carroll 
has been appointed as a nonexecutive director 
of the board and representative of our principal 
shareholder
looking ahead our performance in 2014 has 
given us a solid platform to build upon we 
remain confident in the business and anticipate 
a further year of growth for pets at home
finally on behalf of myself and the board i 
would like to thank all our colleagues for their 
substantial contribution during this historic year 
their continued passion and enthusiasm for the 
business are integral to our success
we will continue to live our values in driving the 
company forward working together as a team 
and taking great pride in what we do
tony denunzio 
nonexecutive chairman
11th june 2014
did you know   
we added more than 2750 products to 
stores in the year refreshing over a third 
of our product range
see additional information online at
investorspetsathomecom
tony denunzio 
nonexecutive chairman
investorspetsathomecom
london stock exchange pets
11
strategic report
overview
investor proposition 04
business model 06
2014 highlights 08
chairman’s statement 10
group at a glance  12
market review 14