The Pep Boys - Manny, Moe & Jack (NYSE: 'PBY')
The nation's leading automotive aftermarket retail and service chain, announced the following results for the thirteen weeks (first quarter) ended May 3, 2008.
Sales for the thirteen weeks ended May 3, 2008 were $498.0 million, as compared to $539.6 million for the thirteen weeks ended May 5, 2007. Comparable Sales decreased 5.6%, including a 6.2% comparable merchandise sales decrease and a 2.9% comparable service revenue decrease. In accordance with GAAP, merchandise sales includes merchandise sold through both our retail and service center lines of business and service revenue is limited to labor sales. Re-categorizing Sales into the respective lines of business from which they are generated, comparable Service Center Revenue (labor plus installed merchandise and tires) increased 0.6% and comparable Retail Sales (DIY and Commercial) decreased 10.2%.
Net Earnings from Continuing Operations increased to $5.3 million or $0.10 per share (basic and diluted) from Net Earnings from Continuing Operations of $3.1 million or $0.06 per share (basic and diluted) for the comparable period in the prior year. Net Earnings increased to $4.7 million or $0.09 per share (basic and diluted) from net earnings of $3.2 million or $0.06 per share for the prior year.
Interim CEO Mike Odell said, 'We are pleased with the progress we have made this quarter. Our service center business revenue and profitability increased. We are broadening our core automotive assortment offering and see positive trends in the categories that have been re-assorted. Our remaining non-core clearance inventory is down to $12.6 million and we expect to complete the sell-through by the end of the second quarter. And, most importantly, we are energizing our team to serve our customers, because that's where it all starts.'
He continued, 'We announced our long-term strategic plan last November and our vision remains unchanged - to take our leading position in the automotive services and accessories categories and become the automotive solutions provider of choice for the value-oriented customer. In order to achieve this vision, we are continuing to lead our turnaround by growing our profitable service center business and leveraging our big boxes with improved parts coverage to support our service, retail and commercial customers. We are updating our sales floor assortments in our automotive superstores to be dominant in the eyes of our customers. And, of course, we consistently pursue profit improvement through increased productivity, margin and expense controls.'
CFO Ray Arthur commented, 'During the quarter, we completed two sale leaseback transactions allowing us to further reduce our long term debt by $58.7 million and build $87.3 in cash and equivalents. Please note that first quarter 2008 Net Earnings From Continuing Operations includes, on a pre-tax basis, a $5.5 million Net Gain from Dispositions of Assets resulting from sale leaseback transactions. First quarter 2007 Net Earnings From Continuing Operations included, on a pre-tax basis, a $3.7 million gain from an insurance claim for stores impaired during Hurricane Katrina in 2005 ($1.3 million of which was recognized in Cost of Merchandise sales) and a $3.9 million charge to SG&A for CEO transition costs.'
Pep Boys, Philadelphia
Investor Contact Gerry Costa, 215-430-9720, firstname.lastname@example.org Media Contac Alex Spooner, 215-430-9588, Nyrknaqen_fcbbare@crcoblf.pbz