Pep Boys Reports 4.1% Comparable Sales Increase; Retail Up 10.3% -- Service Down 3.4%
PHILADELPHIA--Nov. 1, 20040, 2004--The Pep Boys - Manny, Moe & Jack , the nation's leading full-service automotive aftermarket chain, announced the following results for the thirteen and thirty-nine weeks ended October 30, 2004.Financial Results
Third Quarter
Sales
Sales for the quarter ended October 30, 2004 were $559,198,000, 4.0% more than the $537,691,000 recorded last year. Comparable Sales increased 4.1%, resulting from an increase of 5.1% in comparable Merchandise Sales and flat comparable Service Revenue. Recategorizing Sales to more accurately reflect the two areas of automotive aftermarket in which the Company competes, comparable Retail Sales (DIY and Commercial) increased 10.3% and comparable Service Center Revenue (labor plus installed merchandise and tires) decreased 3.4%.
Earnings
Net Earnings from Continuing Operations of $7,881,000 ($.14 per share basic and diluted) declined from the $13,406,000 ($.26 per share - basic and $.24 per share - diluted) recorded last year.
Nine Months
Sales
Sales for the nine months ended October 30, 2004 were $1,718,757,000, 7.1% more than the $1,604,631,000 recorded last year. Comparable Sales increased 7.2% resulting from an increase of 8.5% in comparable Merchandise Sales and an increase of 1.8% in comparable Service Revenue. Recategorizing Sales to more accurately reflect the two areas of automotive aftermarket in which the Company competes, comparable Retail Sales increased 15.0% and comparable Service Center Revenue decreased 2.5%.
Earnings
Net Earnings from Continuing Operations of $38,721,000 ($.68 per share-basic and $.64 per share diluted) increased from a Net Loss from Continuing Operations of $7,500,000 ($.14 per share basic and diluted) incurred in the prior year. Fiscal 2003 results include the impact of our corporate restructuring and other actions that were announced on July 31, 2003.
Commentary
Larry Stevenson, Chairman and CEO commented, "We continue our building process, as Pep Boys makes progress against our multi-year plan.
"While the current quarter's sales and margins in our service and tires business were unacceptable, we are making concerted and significant strides in re-building our service capabilities and infrastructure. It will, however, take us a number of quarters before that progress is apparent.
"We again had industry leading sales results in our retail and commercial business. During the quarter, we completed a significant re-merchandising of our stores, the first step in our store remodel program, which we believe will lead to significant and sustaining retail improvements."
Harry Yanowitz, Senior Vice President and CFO commented, "In this past quarter, and to date in the $100,000,000 share repurchase program announced September 9, 2004, we re-purchased $38,900,000 of our shares (3,018,000 shares at $12.89 per share, or roughly 5% of our undiluted share base). As announced on our last call, we view this program as opportunistic, not as part of a general capital distribution program to our shareholders, and may or may not choose to make further purchases. Future share purchases will have to compare well against other excellent investment alternatives, including our upcoming store remodel program and future store expansion."
Pep Boys Financial Highlights
October 30, November 1,
Thirteen Weeks Ended: 2004 2003
--------------------- -------------- --------------
Total Revenues $ 559,198,000 $ 537,691,000
Net Earnings From Continuing
Operations $ 7,881,000 $ 13,406,000
Net Earnings $ 7,645,000 $ 14,700,000
Average Shares - Diluted 58,326,000 60,410,000
Basic Earnings Per Share From
Continuing Operations $ 0.14 $ 0.26
Diluted Earnings Per Share From
Continuing Operations $ 0.14 $ 0.24
Basic Earnings Per Share $ 0.13 $ 0.28
Diluted Earnings Per Share $ 0.13 $ 0.26
October 30, November 1,
Thirty-nine Weeks Ended: 2004 2003
------------------------ -------------- --------------
Total Revenues $1,718,757,000 $1,604,631,000
Net Earnings (Loss) From Continuing
Operations Before Cumulative Effect
of Change in Accounting Principle $ 38,721,000 $ (7,500,000)
Net Earnings (Loss) $ 37,102,000 $ (30,898,000)
Average Shares - Diluted 64,977,000 52,002,000
Basic Earnings (Loss) Per Share From
Continuing Operations Before
Cumulative Effect of Change in
Accounting Principle $ 0.68 $ (0.14)
Diluted Earnings (Loss) Per Share
From Continuing Operations Before
Cumulative Effect of Change in
Accounting Principle $ 0.64 $ (0.14)
Basic Earnings (Loss) Per Share $ 0.65 $ (0.59)
Diluted Earnings (Loss) Per Share $ 0.62 $ (0.59)
Pep Boys has 595 stores and more than 6,000 service bays in 36 states and Puerto Rico. Along with its vehicle repair and maintenance capabilities, the Company also serves the commercial auto parts delivery market and is one of the leading sellers of replacement tires in the United States. Customers can find the nearest location by calling 1-800 - PEP-BOYS or by visiting pepboys.com.