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Pet Valu Holdings Ltd. PET-T is reporting a drop in profits despite major sales growth in its latest quarter.

In the three months ended July 1, the pet food and supplies retailer says net income fell by $1.2 million or nearly five per cent year over year to $24.1 million.

The dip came despite a revenue jump of $28.7 million or nearly 13 per cent in its second quarter to $256.4 million from $227.7 million in the same period a year earlier.

The Ontario-based company says the increase was driven largely by retail sales growth, offset partly by greater expenses linked to store growth, including higher compensation and amortization costs.

With seven new storefronts launched last quarter to reach 758 in total, Pet Valu continues to aim for between 40 and 50 store openings this year as it looks to seize on the surge in pet purchases made during the COVID-19 pandemic.

On an adjusted basis, diluted net income attributable to common shareholders fell to 33 cents per share versus 35 cents per share a year earlier.

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