PetMed Express, Inc. d/b/a 1-800-PetMeds Announces Its Fourth Quarter and Fiscal Year End Financial Results and Increases Its Quarterly Dividend to $0.28 per Share


15% Increase in 4th Quarter Sales
8.4% Increase in 4th Quarter Diluted Earnings per Share
5% Increase in 4th Quarter New Order Sales

DELRAY BEACH, Fla., May 04, 2020 (GLOBE NEWSWIRE) -- PetMed Express, Inc. (NASDAQ: PETS) today announced its financial results for its fourth quarter and fiscal year ended March 31, 2020. Net sales for the quarter ended March 31, 2020 were $74.3 million, compared to $64.6 million for the quarter ended March 31, 2019, an increase of 15%. Net income for the quarter ended March 31, 2020 was $7.0 million, or $0.35 diluted per share, compared to net income of $6.6 million, or $0.32 diluted per share, for the same quarter the prior year, an increase to diluted earnings per share of 8.4%. Reorder sales for the three months ended March 31, 2020 were $65.2 million, compared to $55.9 million for the three months ended March 31, 2019, an increase of 17%. New order sales for the three months ended March 31, 2020 were $9.1 million, compared to $8.7 million for the three months ended March 31, 2019, an increase of 5%. The Company acquired approximately 107,000 new customers in the quarter ended March 31, 2020, compared to 101,000 new customers in the same period the prior year. The average order size for the quarter ended March 31, 2020 was $90, compared to $85 for the quarter ended March 31, 2019.

Menderes Akdag, President and CEO, commented: “During the March quarter, due to COVID-19, demand has been strong for the ecommerce channel, with consumers shifting their purchases to online, which has positively impacted our sales. We were more efficient with our advertising in the fourth quarter, and we will continue to focus on optimizing our marketing plan in fiscal 2021. As an essential business, we have been open during our normal business hours without any material disruptions in our operations. We are dedicated to making every effort to ensure pets get the medications they need in these challenging times. We have also taken extra precautions to ensure the health and safety of our employees. Also, so far, we have not seen any material disruptions in our supply chain. But, as it is a fluid situation, we are monitoring and managing it closely. In fiscal 2021, we will continue to be price competitive and will increase advertising to acquire new customers, promote brand awareness, and reinforce brand loyalty.”

The Board of Directors declared an increased quarterly dividend from $0.27 to $0.28 per share on its common stock. The dividend will be payable on May 22, 2020, to shareholders of record at the close of business on May 15, 2020. 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, Mr. Akdag will host a conference call to review the year-end financial results. To access the call which is open to the public, dial (888) 455-1758 (toll free) or (203) 827-7025. Please call in fifteen minutes prior to the scheduled start time. 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. Eastern Time on May 4, 2020 until May 18, 2020 at 11:59 P.M. To access the replay, call (800) 814-6745 (toll free) or (203) 369-3349 and enter passcode 5500. Founded in 1996, PetMed Express is America’s Largest 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, 2019. 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
CONSOLIDATED BALANCE SHEETS
(In thousands, except for per share amounts)
  March 31, March 31,
  2020 2019
     
ASSETS (UNAUDITED)  
     
Current assets:    
Cash and cash equivalents$103,762$100,529
Accounts receivable, less allowance for doubtful    
accounts of $59 and $39, respectively 3,843 2,542
Inventories - finished goods 17,884 21,370
Prepaid expenses and other current assets 3,529 1,408
Prepaid income taxes - 582
Total current assets 129,018 126,431
     
Noncurrent assets:    
Property and equipment, net 25,445 27,136
Intangible assets 860 860
Total noncurrent assets 26,305 27,996
     
Total assets$155,323$154,427
     
LIABILITIES AND SHAREHOLDERS' EQUITY    
     
Current liabilities:    
Accounts payable$19,658$16,275
Accrued expenses and other current liabilities 4,214 2,351
Income taxes payable 471 -
Total current liabilities 24,343 18,626
     
Deferred tax liabilities 970 1,121
     
Total liabilities 25,313 19,747
     
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;    
20,166 and 20,674 shares issued and outstanding, respectively 20 21
Additional paid-in capital 3,804 12,478
Retained earnings 126,177 122,172
     
Total shareholders' equity 130,010 134,680
     
Total liabilities and shareholders' equity$155,323$154,427
     


PETMED EXPRESS, INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
 (In thousands, except for per share amount)
         
   Three Months Ended  Year Ended
   March 31,   March 31,
  2020 2019 2020 2019
         
   (UNAUDITED)   (UNAUDITED)   
Sales$74,286$64,565$284,125$283,419
Cost of sales 52,600 43,841 202,879 188,105
         
Gross profit 21,686 20,724 81,246 95,314
         
Operating expenses:        
General and administrative6,413 5,840 25,264 24,767
Advertising 6,205 6,522 22,748 22,148
Depreciation 555 560 2,257 2,225
Total operating expenses 13,173 12,922 50,269 49,140
         
Income from operations 8,513 7,802 30,977 46,174
         
Other income:        
Interest income, net 300 549 1,747 1,864
Other, net 307 256 1,169 1,083
Total other income 607 805 2,916 2,947
         
Income before provision for income taxes9,120 8,607 33,893 49,121
         
Provision for income taxes 2,117 1,987 8,042 11,381
         
Net income$7,003$6,620$25,851$37,740
         
Comprehensive income$7,003$6,620$25,851$37,740
         
Net income per common share:      
Basic$0.35$0.32$1.29$1.84
Diluted$0.35$0.32$1.29$1.84
         
Weighted average number of common shares outstanding:  
Basic 19,984 20,491 20,041 20,461
Diluted 20,010 20,501 20,055 20,491
         
Cash dividends declared per common share$0.27$0.27$1.08$1.06
         


PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
   Year Ended
   March 31,
  2020  2019 
       
  (UNAUDITED)    
Cash flows from operating activities:  
Net income$25,851 $37,740 
Adjustments to reconcile net income to net cash 
provided by operating activities:    
Depreciation 2,257  2,225 
Share based compensation 2,822  3,097 
Deferred income taxes (151) 125 
Bad debt expense 191  85 
(Increase) decrease in operating assets  
and increase (decrease) in liabilities:  
Accounts receivable (1,492) (335)
Inventories - finished goods 3,486  1,967 
Prepaid income taxes 582  206 
Prepaid expenses and other current assets(376) (526)
Accounts payable 3,383  1,001 
Accrued expenses and other current liabilities1,820  (447)
Income taxes payable 471  - 
Net cash provided by operating activities38,844  45,138 
     
Cash flows from investing activities:    
Purchases of property and equipment(2,311) (620)
Net cash used in investing activities (2,311) (620)
     
Cash flows from financing activities:    
Dividends paid (21,803) (21,925)
Repurchase and retirement of common stock(11,497) - 
Net cash used in financing activities (33,300) (21,925)
     
Net increase in cash and cash equivalents3,233  22,593 
     
Cash and cash equivalents, at beginning of year100,529  77,936 
     
Cash and cash equivalents, at end of year$103,762 $100,529 
     
Supplemental disclosure of cash flow information: 
     
Cash paid for income taxes$7,140 $11,051 
     
Property and equipment in current assets$1,745 $- 
     
Dividends payable in accrued expenses$246 $203