EXHIBIT 99.1
Date: July 25, 2005
Contact: Bruce S. Rosenbloom, CFO
Phone: (954) 979 5995
Fax: (954) 971 0544
PETMED EXPRESS D/B/A 1-800-PETMEDS ANNOUNCES RECORD FIRST QUARTER
FINANCIAL RESULTS - NET INCOME INCREASES 95%
Pompano Beach, Florida, July 25, 2005 - PetMed Express, Inc. (NASDAQ:
PETS) today announced its financial results for the quarter ended June
30, 2005. Net income was $3.5 million, or $0.15 diluted per share,
for the quarter ended June 30, 2005, compared to net income of $1.8
million, or $0.08 diluted per share, for the quarter ended June 30,
2004, an increase to net income of 95%. Net sales for the quarter
ended June 30, 2005 were $43.6 million, compared to $35.3 million for
the quarter ended June 30, 2004, an increase of 24%.
The Company acquired approximately 217,000 new customers during the
first fiscal quarter compared to 191,000 new customers for the same
quarter in the prior year. Approximately 54% of all orders were
placed on the Company's website for the first fiscal quarter, compared
to 52% for the same quarter in the prior year.
Menderes Akdag, CEO, commented: "We are pleased to report that our
retail reorder sales increased by 29%, from $19.9 million to $25.8
million for the quarters ended June 30, 2004 and 2005, respectively.
We will continue to focus on reorder sales in fiscal 2006 by
initiating more personalized communication with specific relevance to
our customers. In addition, our retail new order sales increased by
10% to $16.4 million for the first fiscal quarter compared to $14.9
million for the same quarter in the prior year. The advertising cost
of acquiring a new customer for the first fiscal quarter was
approximately $35 compared to $41 for the same quarter in the prior
year. This 15% improvement in the cost of customer acquisition can be
attributed to increased advertising efficiency and more effective
advertising creatives. We are also pleased to report that net cash
provided by operating activities increased by $6.3 million, from $1.7
million for the quarter ended June 30, 2004 to $8.0 million for the
quarter ended June 30, 2005."
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, call (888) 455-1758. 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 July 25, 2005 until August 8, 2005 at 11:59
P.M. To access the replay, call (800) 964-3941 (toll free), 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,
2005. 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.
###
99.1 page 1 - 4
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, March 31,
2005 2005
------------- -------------
(UNAUDITED)
ASSETS
Current assets:
Cash and cash equivalents $ 20,707,737 $ 12,680,962
Accounts receivable, less allowance for doubtful
accounts of $39,000 and $37,000, respectively 1,912,458 1,796,756
Inventories - finished goods 10,096,170 11,180,333
Prepaid expenses and other current assets 203,903 213,152
------------- -------------
Total current assets 32,920,268 25,871,203
Property and equipment, net 1,170,826 1,286,267
Deferred income taxes 595,936 582,846
Intangible asset 365,000 365,000
Other assets 14,167 14,167
------------- -------------
Total assets $ 35,066,197 $ 28,119,483
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,171,099 $ 2,724,990
Income taxes payable 1,806,365 601,535
Accrued expenses and other current liabilities 1,207,874 575,894
------------- -------------
Total liabilities 7,185,338 3,902,419
------------- -------------
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; 23,496,191 and 23,458,725 shares
issued and outstanding, respectively 23,496 23,459
Additional paid-in capital 12,196,783 12,074,611
Retained earnings 15,651,682 12,110,096
------------- -------------
Total shareholders' equity 27,880,859 24,217,064
------------- -------------
Total liabilities and shareholders' equity $ 35,066,197 $ 28,119,483
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99.1 page 2 - 4
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended
June 30,
2005 2004
----------- -----------
Sales $ 43,631,758 $ 35,288,528
Cost of sales 26,773,172 21,426,719
----------- -----------
Gross profit 16,858,586 13,861,809
----------- -----------
Operating expenses:
General and administrative 3,852,894 3,221,905
Advertising 7,604,303 7,754,829
Depreciation and amortization 127,545 159,059
----------- -----------
Total operating expenses 11,584,742 11,135,793
----------- -----------
Income from operations 5,273,844 2,726,016
----------- -----------
Other income (expense)
Interest expense - (742)
Interest income 99,437 4,633
Other, net 40,287 (410)
----------- -----------
Total other income (expense) 139,724 3,481
----------- -----------
Income before provision for income taxes 5,413,568 2,729,497
Provision for income taxes 1,871,982 911,359
----------- -----------
Net income $ 3,541,586 $ 1,818,138
=========== ===========
Net income per common share:
Basic $ 0.15 $ 0.08
=========== ===========
Dilutive $ 0.15 $ 0.08
=========== ===========
Weighted average number of common shares outstanding:
Basic 23,471,264 22,017,221
=========== ===========
Dilutive 23,969,197 23,882,936
=========== ===========
99.1 page 3 - 4
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended
June 30,
2005 2004
------------ ------------
Cash flows from operating activities:
Net income $ 3,541,586 $ 1,818,138
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 127,545 159,059
Tax benefit related to stock options exercised 38,110 32,763
Deferred income taxes (13,090) -
Bad debt expense 2,362 170
(Increase) decrease in operating assets and liabilities:
Accounts receivable (118,064) 56,280
Inventories 1,084,163 (2,990,083)
Prepaid expenses and other current assets 9,249 9,121
Other assets - 7,655
Accounts payable 1,446,109 2,388,665
Income taxes payable 1,204,830 456,151
Accrued expenses and other current liabilities 631,980 (196,498)
------------ ------------
Net cash provided by operating activities 7,954,780 1,741,421
------------ ------------
Cash flows from investing activities:
Purchases of property and equipment (12,104) (67,210)
------------ ------------
Net cash used in investing activities (12,104) (67,210)
------------ ------------
Cash flows from financing activities:
Proceeds from the exercise of stock options, warrants,
and other transactions 84,099 226,727
Payments on the loan obligation - (17,110)
------------ ------------
Net cash provided by financing activities 84,099 209,617
------------ ------------
Net increase in cash and cash equivalents 8,026,775 1,883,828
Cash and cash equivalents, at beginning of period 12,680,962 3,278,926
------------ ------------
Cash and cash equivalents, at end of period $ 20,707,737 $ 5,162,754
============ ============
Supplemental disclosure of cash flow information:
Cash paid for interest $ - $ 802
============ ============
Cash paid for income taxes $ 642,132 $ 422,445
============ ============
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