PHILADELPHIA - April 8, 2009 - The Pep Boys - Manny, Moe & Jack , the nation's leading automotive aftermarket service and retail chain, today announced results for the thirteen (fourth quarter) and fifty-two weeks (fiscal year) ended January 31, 2009 and improved sales trends for the first quarter to date of 2009.
As previously announced, the general pullback in consumer spending during the fourth quarter of 2008 resulted in a weak holiday season and the deferral of tire purchases. However, sales trends have greatly improved from the 10.1% decline the Company experienced in the fourth quarter of fiscal 2008 to flat for the first quarter to date of fiscal 2009.
First Quarter to Date of Fiscal 2009(February 1, 2009 through April 7, 2009)
In order to enable the Company to conduct investor meetings during the week of April 13, the Company is providing information for the first quarter to date of fiscal 2009 in advance of its customary public reporting schedule in accordance with SEC Regulation FD. The Company assumes no obligation to update this information, nor should investors expect similar 'guidance' in future periods.
For the first quarter to date of fiscal 2009, comparable service revenue increased 3.5% and merchandise sales decreased 1.3% versus the same period last year. In accordance with GAAP, service revenue is limited to labor sales and merchandise sales include merchandise sold through both our retail and service center lines of business. 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 2.7%, while comparable Retail Sales (DIY and Commercial) decreased 3.0%. Within Retail Sales, core automotive sales were flat and commercial merchandise sales increased by 8.1%, while sales of complementary merchandise decreased by 10.9%. In addition, for the first quarter to date of fiscal 2009, the Company's gross margin rate has improved, while gross media expense and payroll (as percentage of sales) have declined versus the same period last year.
'We now have two promotional events under our belt demonstrating how our new advertising, coupled with improved store execution, is beginning to pay off,' said CEO Mike Odell. 'Our Does Everything. For Less. branding is resonating with our customers and our customer-focused process improvement and training is helping our associates to deliver a more satisfying customer experience.'
Sales for the thirteen weeks ended January 31, 2009 were $465,536,000 as compared to the $517,639,000 recorded for the thirteen weeks ended February 2, 2008. Comparable service revenue decreased 5.5% and comparable merchandise sales decreased 9.1%. Re-categorizing Sales into lines of business (see above), comparable Service Center Revenue decreased 1.9% and comparable Retail Sales (DIY and Commercial) decreased 13.2%.
Our Net Loss increased to $33,267,000 (($0.63) per share - basic and diluted) for the fourth quarter of fiscal 2008 from the $20,403,000 (($0.39) per share - basic and diluted) recorded in same period last year. The fourth quarter 2008 results included $8.0 million in increased legal and inventory-related accruals, $4.4 million of asset impairments, $1.2 million in debt pre-payment costs, $0.6 million in costs associated with previously announced cost-cutting initiatives and a reduction of the Company's tax provision benefit by approximately $7.0 million due to changes in the Company's effective tax rate. The fourth quarter 2007 results included $8.5 million of margin reductions related to the exiting of non-core merchandise, $6.2 million in store closure costs and $6.0 million in debt pre-payment costs.
Sales for the fiscal year ended January 31, 2009 were $1,927,788,000 as compared to the $2,138,075,000 recorded last year. Comparable service revenue decreased 6.2% and comparable merchandise sales decreased 8.4%. Re-categorizing Sales into lines of business (see above), comparable Service Center Revenue decreased 2.9% and Retail Sales decreased 11.8%.
Our Net Loss improved to $30,429,000 (($0.58) per share - basic and diluted) for fiscal 2008 from the $41,039,000 (($0.79) per share - basic and diluted) recorded for fiscal 2007.
ABOUT PEP BOYS
Pep Boys has over 560 retail stores and approximately 6,000 service bays in 35 states and Puerto Rico. Along with its full-service vehicle maintenance and repair 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 https://www.pepboys.com
PEP BOYS FINANCIAL HIGHLIGHTS
Pep Boys, Philadelphia
Ray Arthur, 215-430-9720Media Contact
Alex Spooner, 215-430-9588