Exhibit 99.1
PETMED EXPRESS D/B/A 1-800-PETMEDS ANNOUNCES RECORD FINANCIAL
RESULTS FOR FISCAL 2008 - PROFITS INCREASED 39% TO EPS $0.82
Pompano Beach, Florida, May 12, 2008 - PetMed Express, Inc.
(NASDAQ: PETS) today announced its financial results for the
fiscal year ended March 31, 2008. Net sales for the year ended
March 31, 2008 were $188.3 million, compared to $162.2 million
for the year ended March 31, 2007, an increase of 16%. Net
income was $20.0 million, or $0.82 diluted per share, for the
year ended March 31, 2008, compared to net income of $14.4
million, or $0.60 diluted per share, for the year ended March
31, 2007, an increase to net income of 39%. For the quarter
ended March 31, 2008, net sales were $40.4 million, compared to
$36.4 million for the quarter ended March 31, 2007, an increase
of 11%. Net income for the quarter ended March 31, 2008 was
$4.9 million, or $0.20 diluted per share, compared to net income
of $3.6 million, or $0.15 diluted per share, for the same
quarter the prior year, an increase to net income of 35%. The
Company acquired approximately 710,000 new customers during the
fiscal year compared to 681,000 during the prior year.
Approximately 65% of all orders were placed on its website
during the fiscal year, compared to 62% during the prior year.
Mendo Akdag, CEO and President, commented: "We are proud to
report high profitability for the year, which can be attributed
to strong reorder growth and our success in leveraging operating
expenses. Our retail reorder sales increased 22%, from $110.5
million to $134.3 million, for the years ended March 31, 2007
and 2008, respectively. Our operating expenses as a percent of
sales improved 200 basis points for the fiscal year ended March
31, 2008 compared to the prior fiscal year. We are pleased to
report that our Internet sales increased by 21% to $122.5
million for the year ended March 31, 2008, compared to $100.9
million for the prior fiscal year. During the fiscal year we
repurchased approximately 952,000 shares of our outstanding
common stock for approximately $11.6 million, pursuant to the
Company's $20.0 million stock buy back plan, averaging
approximately $12.19 per share. Our focus in fiscal 2009 will
be on capturing additional market share, and improving reorders
and our customer service levels. We have agreed to extend our
current lease for our corporate headquarters until 2012, and
have added another 15,000 square feet, primarily for the
extension of our warehouse and pharmacy operations, in order to
support our future growth."
This morning at 8:30 A.M. Eastern Time, Mr. Akdag will host a
conference call to review the year-end financial results. To
access the call which is open to the public, dial (888) 455-1758
(toll free) or (210) 234-0009. 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 May 12, 2008 until May 26, 2008 at 11:59 P.M. To access
the replay, call (800) 839-1176 (toll free) or (402) 998-1048,
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, 2007. 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.
###
Exhibit 99.1 Page 1 of 4
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PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31,
2008 2007
------------ ------------
ASSETS
------
Current assets:
Cash and cash equivalents $ 20,267,829 $ 316,470
Temporary investments 4,780,000 39,125,000
Accounts receivable, less allowance for doubtful
accounts of $32,040 and $27,727, respectively 1,575,263 1,369,521
Inventories - finished goods 17,909,549 16,086,207
Prepaid expenses and other current assets 691,859 1,071,171
------------ ------------
Total current assets 45,224,500 57,968,369
Long term investments 24,740,000 -
Property and equipment, net 1,903,294 1,990,578
Deferred income taxes 1,221,853 894,540
Intangible asset 365,000 365,000
------------ ------------
Total assets $ 73,454,647 $ 61,218,487
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable $ 4,358,774 $ 5,859,756
Income taxes payable 185,243 229,321
Accrued expenses and other current liabilities 1,876,655 1,265,837
------------ ------------
Total liabilities 6,420,672 7,354,914
------------ ------------
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; 23,734,067 and 24,309,417
shares issued, respectively 23,734 24,309
Additional paid-in capital 8,396,277 15,213,254
Retained earnings 58,639,343 38,617,112
Less treasury stock, at cost, 3,100 and 0 shares,
respectively (34,277) -
------------ ------------
Total shareholders' equity 67,033,975 53,863,573
------------ ------------
Total liabilities and shareholders' equity $ 73,454,647 $ 61,218,487
============ ============
Exhibit 99.1 Page 2 of 4
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Year Ended March 31, Quarter Ended March 31,
2008 2007 2008 2007
------------- ------------- ------------- -------------
(UNAUDITED)
Sales $ 188,336,469 $ 162,246,407 $ 40,423,170 $ 36,408,023
Cost of sales 114,122,433 97,680,238 23,731,798 21,677,697
------------- ------------- ------------- -------------
Gross profit 74,214,036 64,566,169 16,691,372 14,730,326
------------- ------------- ------------- -------------
Operating expenses:
General and administrative 20,367,392 17,292,675 4,865,084 4,500,498
Advertising 25,261,042 25,243,029 4,536,021 4,472,329
Depreciation and amortization 589,990 530,440 154,956 134,933
------------- ------------- ------------- -------------
Total operating expenses 46,218,424 43,066,144 9,556,061 9,107,760
------------- ------------- ------------- -------------
Income from operations 27,995,612 21,500,025 7,135,311 5,622,566
------------- ------------- ------------- -------------
Other income (expense):
Interest income, net 1,771,653 1,266,150 443,962 349,025
Other, net 643,880 435,824 108,534 103,695
Loss on disposal of property and equipment - (1,250) - -
------------- ------------- ------------- -------------
Total other income (expense) 2,415,533 1,700,724 552,496 452,720
------------- ------------- ------------- -------------
Income before provision for income taxes 30,411,145 23,200,749 7,687,807 6,075,286
Provision for income taxes 10,388,914 8,757,247 2,784,368 2,451,247
------------- ------------- ------------- -------------
Net income $ 20,022,231 $ 14,443,502 $ 4,903,439 $ 3,624,039
============= ============= ============= =============
Net income per common share:
Basic $ 0.83 $ 0.60 $ 0.21 $ 0.15
============= ============= ============= =============
Diluted $ 0.82 $ 0.60 $ 0.20 $ 0.15
============= ============= ============= =============
Weighted average number of common shares outstanding:
Basic 24,088,258 24,109,035 23,823,046 24,151,983
============= ============= ============= =============
Diluted 24,299,364 24,270,879 24,007,498 24,329,822
============= ============= ============= =============
Exhibit 99.1 Page 3 of 4
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended March 31,
2008 2007 2006
------------- ------------- -------------
Cash flows from operating activities:
Net income $ 20,022,231 $ 14,443,502 $ 12,063,514
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 589,990 530,440 544,535
Share based compensation 1,679,600 1,095,740 -
Tax benefit related to stock options exercised - - 342,920
Deferred income taxes (327,313) (100,538) (211,156)
Loss on disposal of property and equipment - 1,250 1,719
Bad debt expense (recovery) 40,823 29,554 (1,709)
(Increase) decrease in operating assets
and increase (decrease) in liabilities:
Accounts receivable (246,565) (243,294) 642,684
Inventories - finished goods (1,823,342) (1,088,532) (3,817,342)
Prepaid expenses and other current assets 379,312 (488,133) (369,886)
Other assets - 14,167 -
Accounts payable (1,500,982) 2,806,803 327,963
Income taxes payable (44,078) (728,997) 356,783
Accrued expenses and other current liabilities 610,818 292,478 397,465
------------- ------------- -------------
Net cash provided by operating activities 19,380,494 16,564,440 10,277,490
------------- ------------- -------------
Cash flows from investing activities:
Net change in investments 9,605,000 (16,275,000) (11,050,000)
Purchases of property and equipment (502,706) (1,025,079) (758,176)
Net proceeds from the sale of property and equipment - 400 600
------------- ------------- -------------
Net cash provided by (used in) investing activities 9,102,294 (17,299,679) (11,807,576)
------------- ------------- -------------
Cash flows from financing activities:
Purchases of treasury stock (11,600,721) - -
Proceeds from the exercise of stock options 2,784,987 442,084 1,016,031
Tax benefit related to stock options exercised 284,305 242,718 -
------------- ------------- -------------
Net cash (used in) provided by financing activities (8,531,429) 684,802 1,016,031
------------- ------------- -------------
Net increase (decrease) in cash and cash equivalents 19,951,359 (50,437) (514,055)
Cash and cash equivalents, at beginning of year 316,470 366,907 880,962
------------- ------------- -------------
Cash and cash equivalents, at end of year $ 20,267,829 $ 316,470 $ 366,907
============= ============= =============
Supplemental disclosure of cash flow information:
Cash paid for income taxes $ 10,331,000 $ 9,344,063 $ 6,483,132
============= ============= =============
Retirement of treasury stock $ 11,566,444 $ - $ -
============= ============= =============
Exhibit 99.1 Page 4 of 4