UK vet firms Pets at Home, CVS tumble as watchdog begins market review
Reuters
Published Sep 07, 2023 08:41
Updated Sep 07, 2023 13:42
(Reuters) -Shares in British veterinary services firms Pets at Home and CVS Group plunged on Thursday, after the UK's antitrust watchdog launched a review into the market amid concerns that pet owners might not be getting a good deal.
The Competition and Markets Authority (CMA) will look into the fees charged for veterinary services amid soaring costs of living and ensuring customers had all information related to treatment pricing and available options, the regulator said.
"There has been a lot of consolidation in the vet industry in recent years, so now is the right time to take a look at how the market is working," CMA Chief Executive Sarah Cardell said in a statement.
Pets at Home, which leads the British pet services market with a 24% market share, has significant veterinary operations providing both in-clinic and online services in almost two-thirds of its stores.
Shares in Pets at Home fell as much as 12.6% to a more than seven-month low of 330.8 pence. CVS shares plunged close to 36% to 1,365 pence, lowest since December, 2020.
"There continues to be a significant shortage of vets in the UK and employment costs represent the most significant proportion of our cost base. Our pricing reflects this and other inflationary pressures experienced in recent years," CVS Group said in response to the probe.
Pet ownership and adoption has been rising since COVID-19 lockdown in 2020 and work-from-home lifestyles spurred demand for four-legged companions.
"A crackdown on treatments and pricing could hurt margins across the sector," Hargreaves analyst Sophie Lund-Yates said in a note.
Pets at Home in early August said its first-quarter vet business revenue grew 16.3%, helped by an increase in vet capacity.
CVS Group has about 500 practices and 2,250 vets across the UK.
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Written By: Reuters
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