PHILADELPHIA -- Pep Boys reported that sales for the thirteen weeks ending April 29 were $556 million, 1.3 percent less than the $564 million recorded last year. Comparable sales decreased 0.9 percent, including a 1 percent comparable merchandise sales decrease and a 0.6 percent comparable service revenue decrease. In accordance with GAAP, merchandise sales includes merchandise sold through both the company’s retail and service center lines of business and service revenue is limited to labor sales. Recategorizing Sales into the respective lines of business from which they are generated, comparable retail sales (DIY and commercial) decreased 3 percent and comparable service center revenue (labor plus installed merchandise and tires) increased 2.2 percent.

Net Loss from Continuing Operations Before Cumulative Effect of Change in Accounting Principle improved from a Net Loss of $2.5 million (($0.04) per share - basic and diluted) to a Net Loss of $922,000 (($0.02) per share - basic and diluted).

"The Pep Boys team continues to make steady progress against the significant operating challenges we faced last year. Our first quarter operating profit increased from $3.2 million to $7.2 million year over year," said CEO Larry Stevenson. "In particular, as our field team has stabilized service center operations, we were able to report a substantial sequential improvement - not just the service center sales improvement we reported in Q4, but also an improvement from Q3 and Q4 last year in bottom line contribution."

Stevenson continued, "In our retail operations, despite lower sales (due in part to the grand re-opening of the Los Angeles market this quarter last year) and higher depreciation expense, we achieved improved operating results through tight SG&A expense controls and improved product margins."

Harry Yanowitz, CFO, commented, "During the quarter we improved our use of working capital, focusing on our most productive inventory, that resulted in an ending inventory balance slightly below this quarter last year. Operating results were helped through the settlement of a product liability legal reserve (approximately $2.3 million pre-tax) that reduced SG&A in this quarter. There were no material real estate gains or losses in Q1 this year or last year."

For more information about Pep Boys, go to: pepboys.com .

_______________________________________

Click here to view the rest of today's headlines.