PETMED EXPRESS D/B/A 1-800-PETMEDS ANNOUNCES ITS THIRD QUARTER FINANCIAL RESULTS AND ITS $0.17 PER SHARE QUARTERLY DIVIDEND Net Income Increased 5.6%
Gross Margins Increased 98 basis points
Pompano Beach, Florida, January 20, 2015 - PetMed Express, Inc. (NASDAQ: PETS) today announced its financial results for the quarter ended December 31, 2014. Net income was $4.8 million, or $0.24 diluted per share, for the quarter ended December 31, 2014, compared to net income of $4.5 million, or $0.23 diluted per share, for the quarter ended December 31, 2013, an increase to net income of 5.6%. Excluding a one-time charge for an IT-related discontinued project in the quarter ended September 30, 2014, net income for the nine months ended December 31, 2014 was $13.6 million, or $0.67 diluted per share, compared to net income of $13.4 million, or $0.67 diluted per share, for the nine months ended December 31, 2013, an increase to net income of 1.0%. The one-time IT-related discontinued project cost of $1.7 million was expensed in the September quarter. The after tax net impact of this charge was $1.1 million, or $0.05 diluted per share. There are no further charges expected in the future related to this discontinued project.
Net sales for the quarter ended December 31, 2014 were $49.3 million, compared to $50.1 million for the quarter ended December 31, 2013, a decrease of 1.6%. Net sales for the nine months ended December 31, 2014 were $179.4 million, compared to $184.8 million for the quarter ended December 31, 2013, a decrease of 2.9%. The Companyâ€™s online sales for the quarter ended December 31, 2014 were approximately 80% of all sales, compared to 79% for the same quarter the prior year.
Menderes Akdag, President and CEO, commented: "During the quarter we were able to increase gross profit margins and average order size. For the quarter ended December 31, 2014 our gross margins increased 98 basis points, which can be attributed to a shift in sales to higher margin items. Our average order size increased to $76 for the December quarter, compared to $72 for the same period in the prior year. For the quarter ended December 31, 2014, our operational expenses decreased by 51 basis points, mainly due to a reduction in advertising spending. Cash flow from operations was $29.5 million for the quarter ended December 31, 2014, compared to $17.7 million for the quarter ended December 31, 2013. For the remainder of Fiscal 2015 we are focusing on improving our marketing efforts to increase sales."
The Board of Directors declared a quarterly dividend of $0.17 per share on the Companyâ€™s common stock. The dividend will be payable on February 13, 2015, to shareholders of record at the close of business on February 3, 2015. 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 Companyâ€™s financial performance.
This morning at 8:30 A.M. Eastern Time, Mr. Akdag will host a conference call to review the quarterâ€™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 20, 2015 until February 3, 2015 at 11:59 P.M. To access the replay, call (866) 430-8791 (toll free) or (203) 369-0938 and enter passcode 5500.
Founded in 1996, PetMed Express is Americaâ€™s Largest Pet Pharmacy, delivering prescription and non-prescription pet medications and other health products for dogs and cats 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 Companyâ€™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 Managementâ€™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, 2014. The Companyâ€™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, 954-979-5995.