Category: Pharmaceuticals

PetMed Express D/B/A 1-800-PetMeds Announces Record First Quarter Financial Results

First Quarter Net Income Increased 41%
First Quarter New Order Sales Increased 14%
First Quarter Online Sales Increased 12%
 
DELRAY BEACH, Fla., July 24, 2017 -- PetMed Express, Inc. (NASDAQ:PETS) today announced its financial results for the quarter ended June 30, 2017.  Net income was $9.3 million, or $0.45 diluted per share, for the quarter ended June 30, 2017, compared to net income of $6.6 million, or $0.32 diluted per share, for the quarter ended June 30, 2016, a 41% increase to net income.  Net sales for the quarter ended June 30, 2017 were $79.7 million, compared to $72.5 million for the quarter ended June 30, 2016, an increase of 10%.  New order sales increased 14%, to $15.2 million for the quarter ended June 30, 2017, compared to $13.3 million for the same quarter in the prior year.  The Company’s online sales for the quarter ended June 30, 2017 were approximately 84% of all sales compared to 82% for the same quarter the prior year, with online sales increasing 12%. 
Menderes Akdag, CEO and President, commented: “We were encouraged with increases in both new order and reorder sales during the quarter, along with an accelerated increase to net income for the second consecutive quarter.  This increase to net income can be attributed to increased revenue with a shift in sales to higher margin items.  Gross profit as a percentage of sales increased to 34.5% for the quarter ended June 30, 2017, compared to 31.0% for the quarter ended June 30, 2016.  During the quarter ended June 30, 2017, we acquired approximately 169,000 new customers, compared to 158,000 new customers acquired in the same quarter the prior year.  Average order value increased to $87 for the quarter compared to $82 for the same quarter the prior year.  For the remainder of fiscal 2018 we will continue to focus on increasing sales and improving our service levels.”
 
The Board of Directors declared a quarterly dividend of $0.20 per share on the Company’s common stock.  The dividend will be payable on August 18, 2017, to shareholders of record at the close of business on August 7, 2017.  The Company intends to continue to pay regular quarterly dividends; however, the declaration and payment of future dividends is discretionary and will be subject to a determination by the Board of Directors each quarter following its review of the Company’s financial performance.
 
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, please 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 July 24, 2017 until August 7, 2017 at 11:59 P.M.  To access the replay, call (866) 431-7851 (toll free) or (203) 369-0968, 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, 2017.  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.
 
 
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
               
    June 30,         March 31,
    2017         2017
ASSETS   (Unaudited)          
               
Current assets:              
Cash and cash equivalents $ 68,525       $ 58,730
Accounts receivable, less allowance for doubtful              
accounts of $31 and $27, respectively   2,059         1,808
Inventories - finished goods   23,032         20,228
Prepaid expenses and other current assets   1,513         1,019
Total current assets   95,129         81,785
               
Noncurrent assets:              
Property and equipment, net   29,676         30,164
Intangible assets   860         860
Total noncurrent assets   30,536         31,024
               
Total assets $ 125,665       $ 112,809
               
LIABILITIES AND SHAREHOLDERS' EQUITY              
               
Current liabilities:              
Accounts payable $ 16,205       $ 15,221
Accrued expenses and other current liabilities   3,217       $ 2,475
Income taxes payable   6,227         659
Total current liabilities   25,649         18,355
               
Deferred tax liabilities   985         1,088
               
Total liabilities   26,634         19,443
               
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;              
20,525 and 20,526 shares issued and outstanding, respectively   21         21
Additional paid-in capital   7,300         6,806
Retained earnings   91,701         86,530
               
Total shareholders' equity   99,031         93,366
               
Total liabilities and shareholders' equity $ 125,665       $ 112,809
               

 

 PETMED EXPRESS, INC. AND SUBSIDIARIES   
 CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME   
 (In thousands, except for per share amounts) (Unaudited)   
           
     Three Months Ended   
     June 30,   
    2017   2016  
           
 Sales   $    79,657  $    72,487  
 Cost of sales      52,192     50,035  
           
 Gross profit      27,465     22,452  
           
 Operating expenses:           
  General and administrative      6,226     6,098  
  Advertising      6,292     5,760  
  Depreciation      531     194  
 Total operating expenses      13,049     12,052  
           
 Income from operations      14,416     10,400  
           
 Other income:           
  Interest income, net      83     28  
  Other, net      241     53  
 Total other income      324     81  
           
 Income before provision for income taxes      14,740     10,481  
           
 Provision for income taxes      5,464     3,887  
           
 Net income   $    9,276  $    6,594  
           
 Comprehensive income   $    9,276  $    6,594  
           
 Net income per common share:           
  Basic   $    0.46  $    0.33  
  Diluted   $    0.45  $    0.32  
           
 Weighted average number of common shares outstanding:           
  Basic      20,293     20,181  
  Diluted      20,448     20,333  
           
 Cash dividends declared per common share   $    0.20  $    0.19  
           

 

PETMED EXPRESS, INC. AND SUBSIDIARIES  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  
 (In thousands) (Unaudited)   
   
     Three Months Ended   
     June 30,   
    2017     2016    
 Cash flows from operating activities:           
  Net income   $    9,276    $    6,594    
  Adjustments to reconcile net income to net cash           
  provided by operating activities:           
  Depreciation      531       194    
  Share based compensation      494       463    
  Deferred income taxes      (104 )     (44 )  
  Bad debt expense      28       233    
  (Increase) decrease in operating assets           
  and increase in liabilities:           
  Accounts receivable      (279 )     (584 )  
  Inventories - finished goods      (2,804 )     (1,440 )  
  Prepaid income taxes      (494 )     243    
  Prepaid expenses and other current assets      -        1,143    
  Accounts payable      984       2,277    
  Income taxes payable      5,568       3,655    
  Accrued expenses and other current liabilities      696       372    
 Net cash provided by operating activities      13,896       13,106    
           
 Cash flows from investing activities:           
  Purchases of property and equipment      (43 )     (2,604 )  
 Net cash used in investing activities      (43 )     (2,604 )  
           
 Cash flows from financing activities:           
  Dividends paid      (4,058 )     (3,834 )  
 Net cash used in financing activities      (4,058 )     (3,834 )  
           
 Net increase in cash and cash equivalents      9,795       6,668    
 Cash and cash equivalents, at beginning of period      58,730       37,639    
           
 Cash and cash equivalents, at end of period   $    68,525    $    44,307    
           
 Supplemental disclosure of cash flow information:           
           
  Cash paid for income taxes   $    -     $    55    
           
  Property and equipment in current assets   $    -     $    2,573    
           
  Dividends payable in accrued expenses   $    263    $    194    
           
 
 
For investment relations contact PetMed Express, Inc., Bruce S. Rosenbloom, CFO, 561-526-4444.

 

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