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PetMed Express D/B/A 1-800-PetMeds Announces Its First Quarter Financial Results and Its $0.18 Per Share Quarterly Dividend

20:00 EDT 19 Jul 2015 | Globe Newswire

First Quarter Net Income Increased 16% 

First Quarter Reorder Sales Increased 1.8%

POMPANO BEACH, Fla., July 20, 2015 (GLOBE NEWSWIRE) -- PetMed Express, Inc. (NASDAQ:PETS) today announced its financial results for the quarter ended June 30, 2015.  Net income was $5.8 million, or $0.29 diluted per share, for the quarter ended June 30, 2015, compared to net income of $5.0 million, or $0.25 diluted per share, for the quarter ended June 30, 2014, a 16% increase to net income.  Net sales for the quarter ended June 30, 2015 were $71.6 million, compared to $72.5 million for the quarter ended June 30, 2014, a decrease of 1.3%.  The Company’s online sales for the quarter ended June 30, 2015 were approximately 81% of all sales, compared to 80% for the same quarter the prior year. 

Menderes Akdag, CEO and President, commented: “We were able to decrease our operational expenses to improve our bottom line results for the quarter ended June 30, 2015.  For the quarter ended June 30, 2015 our operating expenses decreased by about 260 basis points, which can be attributed to a reduction in advertising spending.  Despite our sales decrease for the quarter we were able to increase our average order size to $82 for the quarter ended June 30, 2015, compared to $78 for the same quarter in the prior year.  Reorder sales increased 1.8%, to $59.6 million for the quarter ended June 30, 2015, compared to $58.5 million for the same quarter in the prior year.  For the remainder of Fiscal 2016 we are focusing on improving our marketing efforts to increase sales and profitability.”

The Board of Directors declared a quarterly dividend of $0.18 per share on the Company’s common stock.  The dividend will be payable on August 14, 2015, to shareholders of record at the close of business on August 3, 2015.  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 20, 2015 until August 3, 2015 at 11:59 P.M.  To access the replay, call (866) 431-7853 (toll free) or (203) 369-0969, 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, 2015.  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,
   2015   2015 
ASSETS (Unaudited)  
     
Current assets:    
  Cash and cash equivalents$   42,685 $   35,613 
  Short term investments - available for sale    15,572     15,591 
  Accounts receivable, less allowance for doubtful    
  accounts of $23 and $8, respectively    3,089     1,931 
  Inventories - finished goods    27,220     25,068 
  Prepaid expenses and other current assets    1,541     1,380 
  Deferred tax assets    938     817 
  Total current assets    91,045     80,400 
     
Noncurrent assets:    
  Property and equipment, net    1,488     1,569 
  Intangible assets    860     860 
  Deferred tax assets    50     23 
  Total noncurrent assets    2,398     2,452 
     
Total assets$   93,443 $   82,852 
     
LIABILITIES AND SHAREHOLDERS' EQUITY    
     
Current liabilities:    
  Accounts payable$   9,980 $   5,153 
  Accrued expenses and other current liabilities    2,229     2,214 
  Income taxes payable    3,352     50 
     
Total liabilities    15,561     7,417 
     
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;    
  20,259 and 20,262 shares issued and outstanding, respectively    20     20 
  Additional paid-in capital    3,488     3,117 
  Retained earnings    74,454     72,343 
  Accumulated other comprehensive loss    (89)    (54)
     
  Total shareholders' equity    77,882     75,435 
     
Total liabilities and shareholders' equity$   93,443 $   82,852 
     
     


  
 PETMED EXPRESS, INC. AND SUBSIDIARIES  
 CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME  
 (In thousands, except for per share amounts) (Unaudited)  
      
   Three Months Ended  
   June 30,  
   2015  2014 
      
 Sales  $    71,634  $   72,541 
 Cost of sales     48,668    48,769 
      
 Gross profit     22,966    23,772 
      
 Operating expenses:      
  General and administrative     5,799    5,875 
  Advertising     7,885    9,896 
  Depreciation     191    163 
 Total operating expenses     13,875    15,934 
      
 Income from operations     9,091    7,838 
      
 Other income (expense):      
  Interest income, net     50    44 
  Other, net     (4)   9 
 Total other income     46    53 
      
 Income before provision for income taxes     9,137    7,891 
      
 Provision for income taxes     3,380    2,918 
      
 Net income  $    5,757  $   4,973 
      
 Net change in unrealized gain (loss) on short      
  term investments     (35)   8 
      
 Comprehensive income  $    5,722  $   4,981 
      
 Net income per common share:      
  Basic  $    0.29  $   0.25 
  Diluted  $    0.29  $   0.25 
      
 Weighted average number of common shares outstanding:      
  Basic     20,074    19,961 
  Diluted     20,198    20,092 
      
 Cash dividends declared per common share  $    0.18  $   0.17 
      
      


  
PETMED EXPRESS, INC. AND SUBSIDIARIES 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
 (In thousands) (Unaudited)  
  
   Three Months Ended  
   June 30,  
   2015   2014  
 Cash flows from operating activities:      
  Net income  $    5,757  $    4,973  
  Adjustments to reconcile net income to net cash      
  provided by operating activities:      
  Depreciation     191     163  
  Share based compensation     371     373  
  Deferred income taxes     (148)    (90) 
  Bad debt expense     168     17  
  (Increase) decrease in operating assets      
  and increase (decrease) in liabilities:      
  Accounts receivable     (1,326)    146  
  Inventories - finished goods     (2,152)    2,840  
  Prepaid income taxes     -      54  
  Prepaid expenses and other current assets     (161)    27  
  Accounts payable     4,827     2,821  
  Income taxes payable     3,302     2,889  
  Accrued expenses and other current liabilities     (18)    44  
 Net cash provided by operating activities     10,811     14,257  
      
 Cash flows from investing activities:      
  Net change in investments     (16)    (20) 
  Purchases of property and equipment     (110)    (6) 
 Net cash used in investing activities     (126)    (26) 
      
 Cash flows from financing activities:      
  Dividends paid     (3,613)    (3,395) 
 Net cash used in financing activities     (3,613)    (3,395) 
      
 Net increase in cash and cash equivalents     7,072     10,836  
 Cash and cash equivalents, at beginning of period     35,613     18,305  
      
 Cash and cash equivalents, at end of period  $    42,685  $    29,141  
      
 Supplemental disclosure of cash flow information:      
      
  Cash paid for income taxes  $    226  $    66  
      
  Dividends payable in accrued expenses  $    245  $    300  
      
      
For investment relations contact PetMed Express, Inc., Bruce S. Rosenbloom, CFO, 954-979-5995.
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