EX-99.1 2 pets_ex99z1.htm PRESS RELEASE Press Release


Exhibit 99.1


PETMED EXPRESS D/B/A 1-800-PETMEDS ANNOUNCES ITS FINANCIAL RESULTS FOR FISCAL 2013

 

Pompano Beach, Florida, May 6, 2013 - PetMed Express, Inc. (NASDAQ: PETS) today announced its financial results for the fiscal year ended March 31, 2013. Net income for the quarter ended March 31, 2013 was $4.6 million, or $0.23 diluted per share, compared to net income of $4.0 million, or $0.20 diluted per share, for the same quarter the prior year, an increase to earnings per share of 16.5%. Net income was $17.2 million, or $0.86 diluted per share, for the year ended March 31, 2013, compared to net income of $16.7 million, or $0.80 diluted per share, for the year ended March 31, 2012, an increase to earnings per share of 6.4%. Net sales for the quarter ended March 31, 2013 were $51.1 million, compared to $55.9 million for the quarter ended March 31, 2012, a decrease of 8.6%. For the year ended March 31, 2013 net sales were $227.8 million, compared to $238.3 million for the year ended March 31, 2012, a decrease of 4.4%. Online sales for the year ended March 31, 2013 were approximately 77% of all sales, compared to 75% for the prior year.


Menderes Akdag, President and CEO, commented: “We were able to increase our gross margins and decrease our operational expenses to improve our bottom line results for the quarter and fiscal year.  For the quarter ended March 31, 2013 our gross profit increased 175 basis points, which can be attributed to a change in our product mix to higher margin items, including generics. For the quarter ended March 31, 2013 our operating expenses decreased by 124 basis points, mainly due to a reduction in advertising spending. Sales were negatively impacted during the quarter due to the colder than normal weather. The unavailability of Novartis brands, due to the manufacturer’s suspended production, negatively impacted our sales for fiscal 2013; however recently this suspension was lifted for certain brands. Average order value was $73 for the fiscal year compared to $76 for the prior fiscal year, which was due to a change in product mix to lower priced items including generics and additional discounts given to customers. During the fiscal year, we maintained our quarterly dividend at $0.15 per share, while also paying a one-time special dividend of $1.00 in December 2012. In accordance with our share repurchase program, we repurchased approximately 397,000 shares paying approximately $3.9 million in fiscal 2013, with $10.2 million remaining as of March 31, 2013. For fiscal 2014 we are focusing on increasing our advertising spending to improve new order sales, shifting sales to higher margin items while continuing to expand our product offerings.“


This morning at 8:30 A.M. Eastern Time, Mr. Akdag will host a conference call to review the year-end financial results. To access the call which is open to the public, dial (888) 455-1758 (toll free) or (203) 827-7025. Callers will be required to supply PETMEDS as the passcode. For those unable to participate in the live event, the call will be available for replay from 10:00 A.M. on May 06, 2013 until May 20, 2013 at 11:59 P.M. To access the replay, call (866) 431-7950 (toll free) or (203) 369-0981 and enter passcode 5500.


Founded in 1996, PetMed Express is America’s Largest Pet Pharmacy, delivering prescription and non-prescription pet medications and other health products for dogs and cats at competitive prices direct to the consumer through its 1-800-PetMeds toll free number and on the Internet through its website at www.1800petmeds.com.


This press release may contain “forward-looking” statements, as defined in the Private Securities Litigation Reform Act of 1995 or by the Securities and Exchange Commission, that involve a number of risks and uncertainties, including the Company’s ability to meet the objectives included in its business plan. Important factors that could cause results to differ materially from those indicated by such “forward-looking” statements are set forth in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the PetMed Express Annual Report on Form 10-K for the year ended March 31, 2012. The Company’s future results may also be impacted by other risk factors listed from time to time in its SEC filings, including, but not limited to, the Company's Form 10-Q and its Annual Report on Form 10-K.


For investment relations contact PetMed Express, Inc., Bruce S. Rosenbloom, CFO, 954-979-5995.


###


Exhibit 99.1 Page 1 of 4





PETMED EXPRESS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands)


 

 

March 31,

 

 

March 31,

 

 

 

2013

 

 

2012

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

18,155

 

 

$

46,801

 

Short term investments - available for sale

 

 

15,490

 

 

 

10,347

 

Accounts receivable, less allowance for doubtful accounts of $5 and $5, respectively

 

 

1,439

 

 

 

1,572

 

Inventories - finished goods

 

 

31,601

 

 

 

26,217

 

Prepaid expenses and other current assets

 

 

2,520

 

 

 

1,241

 

Deferred tax assets

 

 

982

 

 

 

1,230

 

Prepaid income taxes

 

 

-

 

 

 

199

 

Total current assets

 

 

70,187

 

 

 

87,607

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

2,132

 

 

 

2,597

 

Intangible asset

 

 

860

 

 

 

860

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

73,179

 

 

$

91,064

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

6,454

 

 

$

6,619

 

Accrued expenses and other current liabilities

 

 

2,381

 

 

 

2,772

 

Income taxes payables

 

 

162

 

 

 

-

 

Total current liabilities

 

 

8,997

 

 

 

9,391

 

 

 

 

 

 

 

 

 

 

Deferred tax liabilities

 

 

168

 

 

 

492

 

 

 

 

 

 

 

 

 

 

Total liabilities:

 

 

9,165

 

 

 

9,883

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

 

 

Preferred stock, $.001 par value, 5,000 shares authorized; 3 convertible shares issued and outstanding with a liquidation preference of $4 per share

 

 

9

 

 

 

9

 

Common stock, $.001 par value, 40,000 shares authorized; 20,109 and 20,338 shares issued and outstanding, respectively

 

 

20

 

 

 

20

 

Retained earnings

 

 

63,987

 

 

 

81,108

 

Accumulated other comprehensive gain (loss)

 

 

(2

)

 

 

44

 

 

 

 

 

 

 

 

 

 

Total shareholders' equity

 

 

64,014

 

 

 

81,181

 

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

73,179

 

 

$

91,064

 



Exhibit 99.1 Page 2 of 4




PETMED EXPRESS, INC. AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 (In thousands, except for per share amount)


 

 

Three Months Ended

 

 

Year Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2013

 

 

2012

 

 

2013

 

 

2012

 

 

 

(UNAUDITED)

 

 

 

 

 

 

 

Sales

 

$

51,120

 

 

$

55,924

 

 

$

227,829

 

 

$

238,250

 

Cost of sales

 

 

32,885

 

 

 

36,957

 

 

 

150,708

 

 

 

158,085

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

18,235

 

 

 

18,967

 

 

 

77,121

 

 

 

80,165

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

5,152

 

 

 

5,411

 

 

 

21,592

 

 

 

22,363

 

Advertising

 

 

5,557

 

 

 

6,916

 

 

 

27,433

 

 

 

30,369

 

Depreciation

 

 

260

 

 

 

365

 

 

 

1,091

 

 

 

1,411

 

Total operating expenses

 

 

10,969

 

 

 

12,692

 

 

 

50,116

 

 

 

54,143

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

7,266

 

 

 

6,275

 

 

 

27,005

 

 

 

26,022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income, net

 

 

42

 

 

 

60

 

 

 

306

 

 

 

288

 

Other, net

 

 

(2

)

 

 

(1

)

 

 

(5

)

 

 

61

 

Total other income

 

 

40

 

 

 

59

 

 

 

301

 

 

 

349

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before provision for income taxes

 

 

7,306

 

 

 

6,334

 

 

 

27,306

 

 

 

26,371

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

 

2,704

 

 

 

2,341

 

 

 

10,141

 

 

 

9,712

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

4,602

 

 

$

3,993

 

 

$

17,165

 

 

$

16,659

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net change in unrealized gain (loss)on short and long term investments

 

 

12

 

 

 

35

 

 

 

(46

)

 

 

185

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income

 

$

4,614

 

 

$

4,028

 

 

$

17,119

 

 

$

16,844

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.23

 

 

$

0.20

 

 

$

0.86

 

 

$

0.81

 

Diluted

 

$

0.23

 

 

$

0.20

 

 

$

0.86

 

 

$

0.80

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

19,815

 

 

 

20,086

 

 

 

19,926

 

 

 

20,613

 

Diluted

 

 

19,968

 

 

 

20,176

 

 

 

20,049

 

 

 

20,708

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per common share

 

$

0.150

 

 

$

0.150

 

 

$

1.600

 

 

$

0.525

 



Exhibit 99.1 Page 3 of 4




PETMED EXPRESS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)


 

 

Year Ended

 

 

 

March 31,

 

 

 

2013

 

 

2012

 

Cash flows from operating activities:

 

 

 

 

 

 

Net income

 

$

17,165

 

 

$

16,659

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

1,091

 

 

 

1,411

 

Share based compensation

 

 

1,943

 

 

 

2,246

 

Deferred income taxes

 

 

(76

)

 

 

(56

)

Bad debt expense

 

 

56

 

 

 

47

 

(Increase) decrease in operating assets and increase (decrease) in liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

77

 

 

 

366

 

Inventories - finished goods

 

 

(5,384

)

 

 

(1,077

)

Prepaid income taxes

 

 

199

 

 

 

465

 

Prepaid expenses and other current assets

 

 

(1,279

)

 

 

(205

)

Accounts payable

 

 

(165

)

 

 

297

 

Accrued expenses and other current liabilities

 

 

(499

)

 

 

238

 

Income taxes payable

 

 

162

 

 

 

-

 

Net cash provided by operating activities

 

 

13,290

 

 

 

20,391

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Net change in investments

 

 

(5,189

)

 

 

12,344

 

Purchases of property and equipment

 

 

(626

)

 

 

(705

)

Net cash provided by (used in) investing activities

 

 

(5,815

)

 

 

11,639

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Dividends paid

 

 

(31,972

)

 

 

(10,964

)

Purchases of treasury stock

 

 

(3,865

)

 

 

(23,685

)

Tax adjustment related to stock compensation

 

 

(284

)

 

 

(240

)

Net cash used in financing activities

 

 

(36,121

)

 

 

(34,889

)

 

 

 

 

 

 

 

 

 

Net decrease in cash and cash equivalents

 

 

(28,646

)

 

 

(2,859

)

Cash and cash equivalents, at beginning of year

 

 

46,801

 

 

 

49,660

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents, at end of year

 

$

18,155

 

 

$

46,801

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash paid for income taxes

 

$

10,140

 

 

$

9,543

 

 

 

 

 

 

 

 

 

 

Retirement of treasury stock

 

$

3,865

 

 

$

23,685

 

 

 

 

 

 

 

 

 

 

Dividends payable in accrued expenses

 

$

276

 

 

$

168

 



Exhibit 99.1 Page 4 of 4