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 25th 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