Pep Boys Manny Moe & Jack (PBY) 8-K Pep Boys Reports Second Quarter 2010 Results

Exhibit 99.2

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES	(UNAUDITED)
CONSOLIDATED STATEMENTS OF OPERATIONS
(dollar amounts in thousands, except per share amounts)

	Thirteen Weeks Ended										Twenty-Six weeks ended
	July 31, 2010					August 1, 2009					July 31, 2010					August 1, 2009
				%					%					%					%
	Amount			Sales		Amount			Sales		Amount			Sales		Amount			Sales
Merchandise sales	$	406,179		80.5		$	392,071		80.2		$	815,368		80.3		$	790,248		80.2
Service revenue	98,676			19.5		96,840			19.8		199,520			19.7		195,151			19.8
Total revenues	504,855			100.0		488,911			100.0		1,014,888			100.0		985,399			100.0
Costs of merchandise sales	282,362			69.5		275,790			70.3		566,158			69.4		556,825			70.5
Costs of service revenue	87,992			89.2		84,931			87.7		176,634			88.5		170,783			87.5
Total costs of revenues	370,354			73.4		360,721			73.8		742,792			73.2		727,608			73.8
Gross profit from merchandise sales	123,817			30.5		116,281			29.7		249,210			30.6		233,423			29.5
Gross profit from service revenue	10,684			10.8		11,909			12.3		22,886			11.5		24,368			12.5
Total gross profit	134,501			26.6		128,190			26.2		272,096			26.8		257,791			26.2
Selling, general and administrative expenses	113,108			22.4		109,482			22.4		224,740			22.1		217,535			22.1
Net gain (loss) from dispositions of assets	2,449			0.5		(16		)	—		2,494			0.2		(13		)	—
Operating profit	23,842			4.7		18,692			3.8		49,850			4.9		40,243			4.1
Non-operating income	621			0.1		539			0.1		1,205			0.1		942			0.1
Interest expense	6,643			1.3		6,466			1.3		13,251			1.3		8,402			0.9
Earnings from continuing operations before income taxes	17,820			3.5		12,765			2.6		37,804			3.7		32,783			3.3
Income tax expense	7,021			39.4	(1)	4,907			38.4	(1)	14,845			39.3	(1)	13,862			42.3	(1)
Earnings from continuing operations	10,799			2.1		7,858			1.6		22,959			2.3		18,921			1.9
Loss from discontinued operations, net of tax	(201		)	—		(123		)	—		(411		)	—		(277		)	—
Net earnings	10,598			2.1		7,735			1.6		22,548			2.2		18,644			1.9
Retained earnings, beginning of period	384,451					367,882					374,836					358,670
Cash dividends	(1,581		)			(1,577		)			(3,160		)			(3,152		)
Shares issued and other	(223		)			(77		)			(979		)			(199		)
Retained earnings, end of period	$	393,245				$	373,963				$	393,245				$	373,963
Basic earnings per share:
Earnings from continuing operations	$	0.21				$	0.15				$	0.44				$	0.36
Discontinued operations, net of tax	(0.01		)			—					(0.01		)			—
Basic earnings per share	$	0.20				$	0.15				$	0.43				$	0.36
Diluted earnings per share:
Earnings from continuing operations	$	0.20				$	0.15				$	0.43				$	0.36
Discontinued operations, net of tax	—					—					—					—
Diluted earnings per share	$	0.20				$	0.15				$	0.43				$	0.36
Cash dividends per share	$	0.03				$	0.03				$	0.06				$	0.06

(1) As a percentage of earnings from continuing operations before income taxes

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES	(UNAUDITED)
CONSOLIDATED BALANCE SHEETS
(dollar amounts in thousands)

	July 31, 2010			January 30, 2010			August 1, 2009
Assets
Current assets:
Cash and cash equivalents	$	92,363		$	39,326		$	21,886
Accounts receivable, less allowance for uncollectible accounts of $1,703; $1,488 and $1,799	24,204			22,983			21,801
Merchandise inventories	558,932			559,118			548,763
Prepaid expenses	20,816			24,784			18,567
Other current assets	51,598			65,428			53,151
Assets held for disposal	1,778			4,438			9,912
Total current assets	749,691			716,077			674,080
Property and equipment - net	694,262			706,450			719,008
Deferred income taxes	58,968			58,171			77,578
Other long-term assets	17,364			18,388			18,092
Total assets	$	1,520,285		$	1,499,086		$	1,488,758
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	196,676		$	202,974		$	222,974
Trade payable program liability	55,280			34,099			2,614
Accrued expenses	226,505			242,416			236,144
Deferred income taxes	35,750			29,984			41,118
Current maturities of long-term debt	1,079			1,079			1,079
Total current liabilities	515,290			510,552			503,929
Long-term debt less current maturities	305,661			306,201			308,335
Other long-term liabilities	76,325			73,933			69,872
Deferred gain from asset sales	159,177			165,105			164,947
Stockholders’ equity:
Common stock, par value $1 per share:
Authorized 500,000,000 shares; issued 68,557,041 shares	68,557			68,557			68,557
Additional paid-in capital	294,535			293,810			293,037
Retained earnings	393,245			374,836			373,963
Accumulated other comprehensive loss	(18,758		)	(17,691		)	(16,477		)
Less cost of shares in treasury - 16,072,557 shares, 16,164,074 shares and 14,042,311 shares	273,747			276,217			218,141
Less cost of shares in benefits trust - 2,195,270 shares	—			—			59,264
Total stockholders’ equity	463,832			443,295			441,675
Total liabilities and stockholders’ equity	$	1,520,285		$	1,499,086		$	1,488,758

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES	(UNAUDITED)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollar amounts in thousands)

Twenty-Six weeks ended	July 31, 2010			August 1, 2009
Cash flows from operating activities:
Net earnings	$	22,548		$	18,644
Adjustments to reconcile net earnings to net cash provided by continuing operations:
Loss from discontinued operations, net of tax	411			277
Depreciation and amortization	36,656			35,338
Amortization of deferred gain from asset sales	(6,299		)	(6,086		)
Stock compensation expense	1,998			1,284
Gain on debt retirement	—			(6,248		)
Deferred income taxes	5,600			4,455
Gain from sales of assets	(2,494		)	13
Loss from asset impairment	970			47
Other	179			188
Changes in operating assets and liabilities:
Decrease in accounts receivable, prepaid expenses and other	19,673			24,143
Decrease in merchandise inventories	186			16,168
(Decrease) increase in accounts payable	(6,298		)	10,634
Decrease in accrued expenses	(14,917		)	(18,658		)
Increase in other long-term liabilities	911			1,972
Net cash provided by continuing operations	59,124			82,171
Net cash used in discontinued operations	(1,249		)	(543		)
Net cash provided by operating activities	57,875			81,628
Cash flows from investing activities:
Cash paid for property and equipment	(27,284		)	(17,481		)
Proceeds from dispositions of assets	4,077			1,098
Other	(144		)	(500		)
Net cash used in continuing operations	(23,351		)	(16,883		)
Net cash provided by discontinued operations	569			1,758
Net cash used in investing activities	(22,782		)	(15,125		)
Cash flows from financing activities:
Borrowings under line of credit agreements	16,290			222,017
Payments under line of credit agreements	(16,290		)	(244,284		)
Borrowings on trade payable program liability	169,875			35,300
Payments on trade payable program liability	(148,694		)	(64,616		)
Debt payments	(540		)	(11,451		)
Dividends Paid	(3,160		)	(3,152		)
Other	463			237
Net cash provided by (used in) financing activities	17,944			(65,949		)
Net increase in cash and cash equivalents	53,037			554
Cash and cash equivalents at beginning of period	39,326			21,332
Cash and cash equivalents at end of period	$	92,363		$	21,886
Supplemental cash flow information:
Cash paid for income taxes	$	810		$	2,585
Cash paid for interest	$	11,452		$	12,366
Accrued purchases of property and equipment	$	662		$	1,170

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
COMPUTATION OF BASIC AND DILUTED EARNINGS PER SHARE	(in thousands, except per share data)

			Thirteen Weeks Ended						Twenty-Six weeks ended
			July 31, 2010			August 1, 2009			July 31, 2010			August 1, 2009
(a)	Earnings from continuing operations		$	10,799		$	7,858		$	22,959		$	18,921
	Loss from discontinued operations, net of tax		(201		)	(123		)	(411		)	(277		)
	Net earnings		$	10,598		$	7,735		$	22,548		$	18,644
(b)	Basic average number of common shares outstanding during period		52,682			52,384			52,609			52,359
	Common shares assumed issued upon exercise of dilutive stock options, net of assumed repurchase, at the average market price		447			315			426			179
(c)	Diluted average number of common shares assumed outstanding during period		53,129			52,699			53,035			52,538
	Basic earnings per share:
	Earnings from continuing operations	(a) / (b)	$	0.21		$	0.15		$	0.44		$	0.36
	Discontinued operations, net of tax		(0.01		)	—			(0.01		)	—
	Basic earnings per share		$	0.20		$	0.15		$	0.43		$	0.36
	Diluted earnings per share:
	Earnings from continuing operations	(a) / (c)	$	0.20		$	0.15		$	0.43		$	0.36
	Discontinued operations, net of tax		—			—			—			—
	Diluted earnings per share		$	0.20		$	0.15		$	0.43		$	0.36

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
ADDITIONAL INFORMATION	(dollar amounts in thousands)

	Thirteen Weeks Ended						Twenty-Six weeks ended
	July 31, 2010			August 1, 2009			July 31, 2010			August 1, 2009
Capital expenditures	$	14,773		$	11,763		$	27,284		$	17,481
Depreciation and amortization	$	18,442		$	17,965		$	36,656		$	35,338
Non-operating income:
Net rental revenue	$	570		$	487		$	1,087		$	789
Investment income	45			56			111			126
Other income	6			(4		)	7			27
Total	$	621		$	539		$	1,205		$	942
Comparable sales percentages:
Merchandise	2.5		%	-4.0		%	2.1		%	-2.6		%
Service	-0.7		%	5.2		%	-0.3		%	4.5		%
Total	1.8		%	-2.3		%	1.6		%	-1.3		%
Total square feet of retail space (including service centers)							11,749,000			11,534,000
Total store count							594			566
Sales and gross profit by line of business (A):
Retail sales	$	268,804		$	259,435		$	538,511		523,846
Service center revenue	236,051			229,476			476,377			461,553
Total revenues	$	504,855		$	488,911		$	1,014,888		$	985,399
Gross profit from retail sales	$	78,830		$	70,746		$	158,584		144,301
Gross profit from service center revenue	55,671			57,444			113,512			113,490
Total gross profit	$	134,501		$	128,190		$	272,096		$	257,791
Comparable sales percentages (A):
Retail sales	3.4		%	-6.0		%	2.6		%	-4.6		%
Service center revenue	0.1		%	2.3		%	0.5		%	2.8		%
Total revenues	1.8		%	-2.3		%	1.6		%	-1.3		%
Gross profit percentage by line of business (A):
Gross profit percentage from retail sales	29.3		%	27.3		%	29.4		%	27.5		%
Gross profit percentage from service center revenue	23.6		%	25.0		%	23.8		%	24.6		%
Total gross profit percentage	26.6		%	26.2		%	26.8		%	26.2		%

(A) Retail sales include DIY and commercial sales. Service center revenue includes revenue from labor and installed parts and tires.