PetMed Express d/b/a 1-800-PetMeds Announces Its Third Fiscal Quarter Financial Results and Its Quarterly Dividend of $0.28 Per Share

Quarterly Sales Increased 10%
Diluted EPS increased from $0.34 to $0.38 per share
Quarterly Average Order Size increased to $88

DELRAY BEACH, Fla., Jan. 19, 2021 (GLOBE NEWSWIRE) -- PetMed Express, Inc. (NASDAQ: PETS) today announced its financial results for the quarter ended December 31, 2020. Net sales for the quarter ended December 31, 2020 were $65.9 million, compared to $59.9 million for the quarter ended December 31, 2019, an increase of 10.0%. Net sales for the nine months ended December 31, 2020 were $237.5 million, compared to $209.8 million for the nine months ended December 31, 2019, an increase of 13.2%. Net income was $7.6 million, or $0.38 diluted per share, for the quarter ended December 31, 2020, compared to net income of $6.8 million, or $0.34 diluted per share, for the quarter ended December 31, 2019, an 11.3% increase to net income. Net income was $23.8 million, or $1.18 diluted per share, for the nine months ended December 31, 2020, compared to net income of $18.8 million, or $0.94 diluted per share, for the nine months ended December 31, 2019, a 26.0% increase to net income. Reorder sales increased 11.9%, to $60.2 million for the quarter ended December 31, 2020, compared to $53.8 million for the same quarter in the prior year. Reorder sales increased 13.6%, to $208.4 million for the nine months ended December 31, 2020, compared to $183.4 million for the same period in the prior year.

Menderes Akdag, CEO and President, commented: “We were pleased with the Company’s performance during the quarter and throughout 2020, where we have seen both double digit top and bottom line growth. Strong reorder sales and increasing gross and operating margins during the quarter contributed to our success. Our reorder growth for the three and nine months ended on December 31, 2020 was likely energized by the increased use of loyalty credits by our customers through our Loyalty Program, which was launched in September 2019, and by our Easy Refill Program. Our average order size increased from $85 to $88 for the quarters ended December 31, 2019 and 2020, respectively. In the beginning of 2021 we unveiled a new logo to commemorate the Company’s 25^th anniversary. The inspiration for this new logo and brand identity came mostly from consumer feedback. We embraced the opportunity to refresh our logo and brand to best represent both pet health and wellness on our new website platform. In the next fiscal year, we will be exploring alternative ways of acquiring new customers and adding value-added services, and we will continue investing in our e-commerce platform and mobile app to optimize our customers’ digital experience.”

The Board of Directors declared a quarterly dividend of $0.28 per share on the Company’s common stock. The dividend will be payable on February 12, 2021, to shareholders of record at the close of business on February 1, 2021. The Company intends to continue to pay regular quarterly dividends; however, the declaration and payment of future dividends is discretionary and will be subject to a determination by the Board of Directors each quarter following its review of the Company’s financial performance.

This morning at 8:30 A.M. Eastern Time, the Company will host a conference call to review the quarter’s financial results. To access the call, which is open to the public, please dial (888) 455-1758 (toll free) or (203) 827-7025. 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 10:00 A.M. on January 19, 2021 until February 2, 2021 at 11:59 P.M. Eastern Time. To access the replay, call (888) 676-2680 (toll free) or (402) 220-6446, and enter passcode 5500.

Founded in 1996, PetMed Express is America’s Most Trusted 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, 2020. 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, 561-526-4444.

PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except for per share data)
		December 31,		March 31,
		2020		2020
ASSETS		(Unaudited)
Current assets:
Cash and cash equivalents	$	106,501	$	103,762
Accounts receivable, less allowance for doubtful
accounts of $28 and $59, respectively		1,831		3,843
Inventories - finished goods		28,165		17,884
Prepaid expenses and other current assets		4,512		3,529
Total current assets		141,009		129,018
Noncurrent assets:
Property and equipment, net		25,502		25,445
Intangible assets		860		860
Total noncurrent assets		26,362		26,305
Total assets	$	167,371	$	155,323
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	21,869	$	19,658
Accrued expenses and other current liabilities		4,429		4,214
Income taxes payable		623		471
Total current liabilities		26,921		24,343
Deferred tax liabilities		1,323		970
Total liabilities		28,244		25,313
Commitments and contingencies
Shareholders' equity:
Preferred stock, $.001 par value, 5,000 shares authorized;
3 convertible shares issued and outstanding with a
liquidation preference of $4 per share		9		9
Common stock, $.001 par value, 40,000 shares authorized;
20,271 and 20,166 shares issued and outstanding, respectively		20		20
Additional paid-in capital		6,098		3,804
Retained earnings		133,000		126,177
Total shareholders' equity		139,127		130,010
Total liabilities and shareholders' equity	$	167,371	$	155,323

 

PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except for per share amounts) (Unaudited)
		Three Months Ended				Nine Months Ended
		December 31,				December 31,
		2020		2019		2020		2019
Sales	$	65,896	$	59,915	$	237,536	$	209,839
Cost of sales		46,273		42,218		168,110		150,279
Gross profit		19,623		17,697		69,426		59,560
Operating expenses:
General and administrative		6,487		6,040		21,050		18,851
Advertising		3,221		3,163		17,385		16,543
Depreciation		622		562		1,791		1,702
Total operating expenses		10,330		9,765		40,226		37,096
Income from operations		9,293		7,932		29,200		22,464
Other income:
Interest income, net		73		421		229		1,447
Other, net		345		301		938		862
Total other income		418		722		1,167		2,309
Income before provision for income taxes		9,711		8,654		30,367		24,773
Provision for income taxes		2,100		1,814		6,576		5,925
Net income	$	7,611	$	6,840	$	23,791	$	18,848
Net income per common share:
Basic	$	0.38	$	0.34	$	1.19	$	0.94
Diluted	$	0.38	$	0.34	$	1.18	$	0.94
Weighted average number of common shares outstanding:
Basic		20,094		19,984		20,047		20,060
Diluted		20,104		19,994		20,100		20,071
Cash dividends declared per common share	$	0.28	$	0.27	$	0.84	$	0.81

 

PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited)
		Nine Months Ended
		December 31,
		2020			2019
Cash flows from operating activities:
Net income	$	23,791		$	18,848
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation		1,791			1,702
Share based compensation		2,294			2,081
Deferred income taxes		353			(12	)
Bad debt expense		84			102
(Increase) decrease in operating assets
and increase (decrease) in liabilities:
Accounts receivable		1,928			388
Inventories - finished goods		(10,281	)		(2,795	)
Prepaid income taxes		-			582
Prepaid expenses and other current assets		(983	)		(1,424	)
Accounts payable		2,211			360
Accrued expenses and other current liabilities		286			851
Income taxes payable		152			895
Net cash provided by operating activities		21,626			21,578
Cash flows from investing activities:
Purchases of property and equipment		(1,848	)		(1,827	)
Net cash used in investing activities		(1,848	)		(1,827	)
Cash flows from financing activities:
Repurchase and retirement of common stock		-			(11,496	)
Dividends paid		(17,039	)		(16,410	)
Net cash used in financing activities		(17,039	)		(27,906	)
Net increase (decrease) in cash and cash equivalents		2,739			(8,155	)
Cash and cash equivalents, at beginning of period		103,762			100,529
Cash and cash equivalents, at end of period	$	106,501		$	92,374
Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	6,356		$	4,460
Property and equipment in current assets	$	-		$	1,344
Dividends payable in accrued expenses	$	174		$	196