Pep Boys Manny Moe & Jack (PBY) 8-K Pep Boys Reports Second Quarter 2012 Results

Exhibit 99.2

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES (UNAUDITED)

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(dollar amounts in thousands, except per share amounts)

	Thirteen weeks ended										Twenty-six weeks ended
	July 28, 2012					July 30, 2011					July 28, 2012					July 30, 2011
				%					%					%				%
	Amount			Sales		Amount			Sales		Amount			Sales		Amount		Sales
Merchandise sales	$	413,380		78.6		$	415,267		79.5		$	825,712		78.6		$	823,894	79.5
Service revenue	112,291			21.4		107,327			20.5		224,563			21.4		212,240		20.5
Total revenues	525,671			100.0		522,594			100.0		1,050,275			100.0		1,036,134		100.0
Costs of merchandise sales	288,051			69.7		287,721			69.3		578,907			70.1		573,050		69.6
Costs of service revenue	107,019			95.3		99,663			92.9		213,115			94.9		192,752		90.8
Total costs of revenues	395,070			75.2		387,384			74.1		792,022			75.4		765,802		73.9
Gross profit from merchandise sales	125,329			30.3		127,546			30.7		246,805			29.9		250,844		30.5
Gross profit from service revenue	5,272			4.7		7,664			7.1		11,448			5.1		19,488		9.2
Total gross profit	130,601			24.8		135,210			25.9		258,253			24.6		270,332		26.1
Selling, general and administrative expenses	114,277			21.7		113,268			21.7		233,987			22.3		222,168		21.4
Net (loss) gain from dispositions of assets	(9		)	—		(3		)	—		(11		)	—		86		—
Operating profit	16,315			3.1		21,939			4.2		24,255			2.3		48,250		4.7
Merger termination fees, net	42,955			8.2		—			—		42,955			4.1		—		—
Other income	521			0.1		569			0.1		991			0.1		1,156		0.1
Interest expense	6,427			1.2		6,444			1.2		12,943			1.2		12,941		1.3
Earnings from continuing operations before income taxes and discontinued operations	53,364			10.2		16,064			3.1		55,258			5.3		36,465		3.5
Income tax expense	20,330			38.1	(1)	2,173			13.5	(1)	21,090			38.2	(1)	10,169		27.9	(1)
Earnings from continuing operations before discontinued operations	33,034			6.3		13,891			2.7		34,168			3.3		26,296		2.5
Income (loss) from discontinued operations, net of tax	14			—		52			—		(58		)	—		15		—
Net earnings	33,048			6.3		13,943			2.7		34,110			3.3		26,311		2.5
Basic earnings per share:
Earnings from continuing operations before discontinued operations	$	0.62				$	0.26				$	0.64				$	0.49
Discontinued operations, net of tax	—					—					—					—
Basic earnings per share	$	0.62				$	0.26				$	0.64				$	0.49
Diluted earnings per share:
Earnings from continuing operations before discontinued operations	$	0.61				$	0.26				$	0.63				$	0.49
Discontinued operations, net of tax	—					—					—					—
Diluted earnings per share	$	0.61				$	0.26				$	0.63				$	0.49
Other comprehensive income:
Defined benefit plan adjustment, net of tax	354					253					708					473
Derivative financial instruments adjustment, net of tax	910					170					1,930					685
Other comprehensive income	1,264					423					2,638					1,158
Comprehensive income	34,312					14,366					36,748					27,469

(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 28, 2012			January 28, 2012			July 30, 2011
Assets
Current assets:
Cash and cash equivalents	$	150,833		$	58,244		$	61,977
Accounts receivable, less allowance for uncollectible accounts of $1,247; $1,303 and $1,406	27,962			25,792			21,731
Merchandise inventories	626,555			614,136			584,297
Prepaid expenses	21,021			26,394			19,694
Other current assets	53,083			59,979			50,891
Total current assets	879,454			784,545			738,590
Property and equipment - net	682,619			696,339			693,742
Goodwill	46,917			46,917			48,584
Deferred income taxes	45,825			72,870			67,988
Other long-term assets	31,660			33,108			31,700
Total assets	$	1,686,475		$	1,633,779		$	1,580,604
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	246,522		$	243,712		$	230,884
Trade payable program liability	115,746			85,214			61,440
Accrued expenses	218,548			221,705			206,627
Deferred income taxes	61,231			66,208			58,825
Current maturities of long-term debt	1,254			1,079			1,079
Total current liabilities	643,301			617,918			558,855
Long-term debt less current maturities	293,504			294,043			294,583
Other long-term liabilities	72,290			77,216			75,688
Deferred gain from asset sales	133,971			140,273			146,573
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	295,536			296,462			295,934
Retained earnings	454,343			423,437			424,923
Accumulated other comprehensive loss	(15,011		)	(17,649		)	(15,870		)
Treasury stock, at cost - 15,563,931 shares; 15,803,322 shares and 15,894,177 shares	(260,016		)	(266,478		)	(268,639		)
Total stockholders’ equity	543,409			504,329			504,905
Total liabilities and stockholders’ equity	$	1,686,475		$	1,633,779		$	1,580,604
Supplemental Balance Sheet Information:
Working capital	$	236,153		$	166,627		$	179,735
Accounts payable to inventory ratio	57.8		%	53.6		%	50.0		%
Total debt as a percent of total capitalization	35.2		%	36.9		%	36.9		%
Net debt as a percent of total capitalization, net	20.9		%	32.0		%	31.6		%

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES (UNAUDITED)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(dollar amounts in thousands)

Twenty-six weeks ended	July 28, 2012			July 30, 2011
Cash flows from operating activities:
Net earnings	$	34,110		$	26,311
Adjustments to reconcile net earnings to net cash provided by continuing operations:
Net loss (income) from discontinued operations	58			(15		)
Depreciation and amortization	39,288			39,654
Amortization of deferred gain from asset sales	(6,302		)	(6,302		)
Stock compensation expense	1,043			1,908
Deferred income taxes	20,485			4,238
Net loss (gain) from disposition of assets	11			(86		)
Loss from asset impairment	—			389
Other	13			272
Changes in assets and liabilities, net of the effects of acquisitions:
Decrease in accounts receivable, prepaid expenses and other	11,448			21,816
Increase in merchandise inventories	(12,419		)	(12,917		)
Increase in accounts payable	2,810			12,043
Decrease in accrued expenses	(2,451		)	(33,202		)
Decrease in other long-term liabilities	(552		)	(2,831		)
Net cash provided by continuing operations	87,542			51,278
Net cash used in discontinued operations	(92		)	(44		)
Net cash provided by operating activities	87,450			51,234
Cash flows from investing activities:
Capital expenditures	(26,347		)	(30,636		)
Proceeds from dispositions of assets	—			89
Premiums paid on life insurance policies	—			(795		)
Acquisitions, net of cash acquired	—			(42,757		)
Collateral investment	—			(4,763		)
Net cash used in investing activities	(26,347		)	(78,862		)
Cash flows from financing activities:
Borrowings under line of credit agreements	1,106			5,045
Payments under line of credit agreements	(931		)	(5,045		)
Borrowings on trade payable program liability	80,836			59,097
Payments on trade payable program liability	(50,304		)	(53,944		)
Payment for finance issuance cost				(2,441		)
Debt payments	(539		)	(539		)
Dividends paid	—			(3,171		)
Proceeds from stock issuance	1,318			363
Net cash provided by (used in) financing activities	31,486			(635		)
Net increase (decrease) in cash and cash equivalents	92,589			(28,263		)
Cash and cash equivalents at beginning of period	58,244			90,240
Cash and cash equivalents at end of period	$	150,833		$	61,977
Supplemental cash flow information:
Cash paid for income taxes	$	1,705		$	629
Cash paid for interest	$	11,449		$	11,523
Accrued purchases of property and equipment	$	632		$	1,416

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 28, 2012		July 30, 2011		July 28, 2012			July 30, 2011
(a)	Earnings from continuing operations		$	33,034	$	13,891	$	34,168		$	26,296
	Income (loss) from discontinued operations, net of tax		14		52		(58		)	15
	Net earnings		$	33,048	$	13,943	$	34,110		$	26,311
(b)	Basic average number of common shares outstanding during period		53,146		52,952		53,110			52,901
	Common shares assumed issued upon exercise of dilutive stock options, net of assumed repurchase, at the average market price		651		697		765			691
(c)	Diluted average number of common shares assumed outstanding during period		53,797		53,649		53,875			53,592
	Basic earnings per share:
	Earnings from continuing operations	(a) / (b)	$	0.62	$	0.26	$	0.64		$	0.49
	Discontinued operations, net of tax		—		—		—			—
	Basic earnings per share		$	0.62	$	0.26	$	0.64		$	0.49
	Diluted earnings per share:
	Earnings from continuing operations	(a) / (c)	$	0.61	$	0.26	$	0.63		$	0.49
	Discontinued operations, net of tax		—		—		—			—
	Diluted earnings per share		$	0.61	$	0.26	$	0.63		$	0.49

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES

ADDITIONAL INFORMATION (dollar amounts in thousands)

	Thirteen weeks ended						Twenty-six weeks ended
	July 28, 2012			July 30, 2011			July 28, 2012			July 30, 2011
Capital expenditures	$	14,407		$	12,513		$	26,347		$	30,636
Depreciation and amortization	$	19,350		$	19,770		$	39,288		$	39,654
Non-operating income:
Net rental revenue	$	429		$	523		$	814		$	1,017
Investment income	46			40			94			122
Merger termination fees, net	42,955			—			42,955			—
Other income	46			6			83			17
Total	$	43,476		$	569		$	43,946		$	1,156
Comparable sales percentages:
Service	3.1		%	0.3		%	1.0		%	0.9		%
Merchandise	-0.9		%	-2.5		%	-2.0		%	-1.8		%
Total	0.0		%	-2.0		%	-1.4		%	-1.3		%
Total square feet of retail space (including service centers)							12,660,000			12,563,000
Store count
Supercenter							562			561
Service & Tire Center							173			156
Retail Only							7			8
Total							742			725
Sales and gross profit by line of business (A):
Service center revenue	$	274,257		$	260,835		$	545,346		508,165
Retail sales	251,414			261,759			504,929			527,969
Total revenues	$	525,671		$	522,594		$	1,050,275		$	1,036,134
Gross profit from service center revenue	$	55,868		$	60,669		$	109,756		119,631
Gross profit from retail sales	74,733			74,541			148,497			150,701
Total gross profit	$	130,601		$	135,210		$	258,253		$	270,332
Comparable sales percentages by line of business (A):
Service center revenue	3.8		%	-0.7		%	1.6		%	-0.2		%
Retail sales	-3.8		%	-3.1		%	-4.2		%	-2.3		%
Total revenues	0.0		%	-2.0		%	-1.4		%	-1.3		%
Gross profit percentage by line of business (A):
Gross profit percentage from service center revenue	20.4		%	23.3		%	20.1		%	23.5		%
Gross profit percentage from retail sales	29.7		%	28.5		%	29.4		%	28.5		%
Total gross profit percentage	24.8		%	25.9		%	24.6		%	26.1		%

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