EX-99.1 2 ex991.htm PRESS RELEASE Exhibit 99

Exhibit 99.1

PETMED EXPRESS D/B/A 1-800-PETMEDS

ANNOUNCES THIRD QUARTER FINANCIAL RESULTS

New Order Sales Increase 25%

Net Sales Increase 16% to $43.4 Million

Earnings Increase 15% to $0.21 Diluted Per Share

Pompano Beach, Florida, January 20, 2009 - PetMed Express, Inc. (NASDAQ: PETS) today announced its financial results for the quarter ended December 31, 2008.  Net sales for this quarter were $43.4 million compared to $37.3 million for the quarter ended December 31, 2007, an increase of 16%.  Net sales for the nine months ended December 31, 2008 were $171.3 million compared to $147.9 million for the nine months ended December 31, 2007, also an increase of 16%.  Net income was $4.9 million or $0.21 diluted per share for the quarter ended December 31, 2008, compared to net income of $4.4 million or $0.18 diluted per share for the quarter ended December 31, 2007, an increase to earnings per share of 15%.  For the nine months ended December 31, 2008, net income was $17.3 million or $0.73 diluted per share compared to net income of $15.1 million or $0.62 diluted per share for the nine months ended December 31, 2007, an increase to earnings per share of 18%.  


Menderes Akdag, President and CEO, commented: “We are pleased to report that new order sales increased by 25% to $11.2 million for the quarter ended December 31, 2008, compared to $9.0 million for the same quarter the prior year.  We acquired approximately 154,000 new customers in the quarter ended December 31, 2008, compared to 127,000 new customers for the same quarter the prior year.  We are also pleased to report that our net cash from operations increased by 60% to $15.8 million for the nine months ended December 31, 2008 from $9.9 million for the same period the prior year.  Our continuing focus will be on capturing additional market share, and improving reorders and our customer service levels in fiscal 2009.  Additionally, the Company repurchased approximately 336,000 shares of its outstanding common stock for approximately $4.6 million during the third quarter of fiscal 2009.”


This morning at 8:30 A.M. Eastern Time, Mr. Akdag will host a conference call to review the quarter’s financial results.  To access the call which is open to the public, dial (888) 455-1758 (toll free) or (210) 234-0009.  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 A.M. on January 20, 2009 until February 3, 2009 at 11:59 P.M.  To access the replay, call (866) 507-3618 (toll free) or (203) 369-1892, 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, cats, and horses 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, 2008.  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

CONDENSED CONSOLIDATED BALANCE SHEETS


 

 

December 31,

 

March 31,

 

 

 

2008

 

2008

 

 

 

(UNAUDITED)

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

     

 

 

     

 

 

 

Cash and cash equivalents

 

$

27,190,543

 

$

20,267,829

 

Temporary investments

 

 

16,490,000

 

 

4,780,000

 

Accounts receivable, less allowance for doubtful

 

 

 

 

 

 

 

accounts of $42,297 and $32,040, respectively

 

 

2,075,862

 

 

1,575,263

 

Inventories - finished goods

 

 

19,654,770

 

 

17,909,549

 

Prepaid expenses and other current assets

 

 

661,576

 

 

691,859

 

Prepaid income taxes

 

 

4,000,000

 

 

 

Total current assets

 

 

70,072,751

 

 

45,224,500

 

 

 

 

 

 

 

 

 

Long term investments

 

 

14,650,000

 

 

24,740,000

 

Property and equipment, net

 

 

4,948,932

 

 

1,903,294

 

Deferred income taxes

 

 

908,759

 

 

1,221,853

 

Intangible assets

 

 

850,000

 

 

365,000

 

 

 

 

 

 

 

 

 

Total assets

 

$

91,430,442

 

$

73,454,647

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

 

$

6,279,299

 

$

4,358,774

 

Accrued expenses and other current liabilities

 

 

2,022,664

 

 

1,876,655

 

Income taxes payable

 

 

2,686,014

 

 

185,243

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

10,987,977

 

 

6,420,672

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

 

Preferred stock, $.001 par value, 5,000,000 shares authorized;

 

 

 

 

 

 

 

2,500 convertible shares issued and outstanding with a

 

 

 

 

 

 

 

liquidation preference of $4 per share

 

 

8,898

 

 

8,898

 

Common stock, $.001 par value, 40,000,000 shares authorized;

 

 

 

 

 

 

 

23,476,046 and 23,734,067 shares issued, respectively

 

 

23,476

 

 

23,734

 

Additional paid-in capital

 

 

4,443,674

 

 

8,396,277

 

Retained earnings

 

 

75,966,417

 

 

58,639,343

 

Less treasury stock, at cost; 0 and 3,100 shares, respectively

 

 

 

 

(34,277

)

 

 

 

 

 

 

 

 

Total shareholders' equity

 

 

80,442,465

 

 

67,033,975

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

 

$

91,430,442

 

$

73,454,647

 




Exhibit 99.1 Page 2 of 4



PETMED EXPRESS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)


 

 

Three Months Ended

 

Nine Months Ended

 

 

 

December 31,

 

December 31,

 

 

 

2008

 

2007

 

2008

 

2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

     

$

43,405,846

     

$

37,348,867

     

$

171,341,670

     

$

147,913,299

 

Cost of sales

 

 

26,088,572

 

 

22,175,847

 

 

105,375,803

 

 

90,390,635

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

17,317,274

 

 

15,173,020

 

 

65,965,867

 

 

57,522,664

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

5,019,183

 

 

4,542,522

 

 

16,448,431

 

 

15,502,308

 

Advertising

 

 

4,899,893

 

 

4,170,113

 

 

23,619,602

 

 

20,725,021

 

Depreciation and amortization

 

 

185,649

 

 

155,385

 

 

503,277

 

 

435,034

 

Total operating expenses

 

 

10,104,725

 

 

8,868,020

 

 

40,571,310

 

 

36,662,363

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

7,212,549

 

 

6,305,000

 

 

25,394,557

 

 

20,860,301

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income, net

 

 

297,017

 

 

454,438

 

 

958,735

 

 

1,327,691

 

Other, net

 

 

(27,616

)

 

110,416

 

 

301,835

 

 

535,346

 

Total other income

 

 

269,401

 

 

564,854

 

 

1,260,570

 

 

1,863,037

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before provision for income taxes

 

 

7,481,950

 

 

6,869,854

 

 

26,655,127

 

 

22,723,338

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

 

2,597,182

 

 

2,459,872

 

 

9,328,053

 

 

7,604,546

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

4,884,768

 

$

4,409,982

     

$

17,327,074

     

$

15,118,792

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.21

 

$

0.18

 

$

0.74

 

$

0.63

 

Diluted

 

$

0.21

 

$

0.18

 

$

0.73

 

$

0.62

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

23,333,025

 

 

24,162,552

 

 

23,446,990

 

 

24,175,567

 

Diluted

 

 

23,542,120

 

 

24,386,821

 

 

23,627,969

 

 

24,396,653

 













Exhibit 99.1 Page 3 of 4





PETMED EXPRESS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


 

 

Nine Months Ended

 

 

 

December 31,

 

 

 

2008

 

2007

 

Cash flows from operating activities:

     

 

 

     

 

 

 

Net income

 

$

17,327,074

 

$

15,118,792

 

Adjustments to reconcile net income to net cash

 

 

 

 

 

 

 

provided by operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

 

503,277

 

 

435,034

 

Share based compensation

 

 

1,089,889

 

 

1,237,893

 

Deferred income taxes

 

 

313,094

 

 

(536,014

)

Bad debt expense

 

 

48,656

 

 

16,508

 

(Increase) decrease in operating assets

 

 

 

 

 

 

 

and increase (decrease) in liabilities:

 

 

 

 

 

 

 

Accounts receivable

 

 

(549,255

)

 

564,267

 

Inventories - finished goods

 

 

(1,745,221

)

 

(4,025,946

)

Prepaid income taxes

 

 

(4,000,000

)

 

(213,750

)

Prepaid expenses and other current assets

 

 

30,283

 

 

168,905

 

Accounts payable

 

 

119,499

 

 

(3,199,167

)

Income taxes payable

 

 

2,500,771

 

 

(229,321

)

Accrued expenses and other current liabilities

 

 

146,009

 

 

525,795

 

Net cash provided by operating activities

 

 

15,784,076

 

 

9,862,996

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Net change in investments

 

 

(1,620,000

)

 

(5,735,000

)

Purchases of property and equipment

 

 

(1,747,889

)

 

(352,036

)

Purchase of intangible asset

 

 

(485,000

)

 

 

Net cash used in investing activities

 

 

(3,852,889

)

 

(6,087,036

)

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Purchases of treasury stock

 

 

(6,776,696

)

 

(4,868,492

)

Proceeds from the exercise of stock options

 

 

1,535,035

 

 

2,648,703

 

Tax benefit related to stock options exercised

 

 

233,188

 

 

267,631

 

Net cash used in financing activities

 

 

(5,008,473

)

 

(1,952,158

)

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

 

6,922,714

 

 

1,823,802

 

Cash and cash equivalents, at beginning of period

 

 

20,267,829

 

 

316,470

 

 

 

 

 

 

 

 

 

Cash and cash equivalents, at end of period

 

$

27,190,543

 

$

2,140,272

 

 

 

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash paid for income taxes

 

$

10,281,000

 

$

8,316,000

 

 

 

 

 

 

 

 

 

Retirement of treasury stock

 

$

6,810,973

 

$

4,689,140

 

 

 

 

 

 

 

 

 

Property and equipment purchases in accounts payable

 

$

1,801,026

 

$

 




Exhibit 99.1 Page 4 of 4