PHILADELPHIA — Pep Boys has announced the following sales results for the nine weeks ending December 31, 2005.
Sales for the nine weeks were $401.5 million, 1.1 percent more than the $397 million recorded last year. Comparable merchandise sales increased 2.5 percent and comparable service revenue decreased 3.1 percent. In accordance with GAAP, merchandise sales includes merchandise sold through both the retail and service center lines of the 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) increased 2.1 percent and comparable service center revenue (labor plus installed merchandise and tires) increased 0.7 percent.
Pep Boys CFO Harry Yanowitz said, “We are pleased that revenues generated from our service center business have accelerated substantially from this summer. However, as we discussed on our last earnings call, restoring margins to historic levels will also require improved tire margins and labor productivity.”
He added, “While a substantial portion of the seasonally-slow quarter remains, we believe we are on plan with our retail business, reflecting modest revenue increases and year-on-year margin improvements.”
As previously announced, the Pep Boys is in the process of assisting Wachovia Capital Markets, LLC in syndicating a $200 million senior secured term loan underwritten by Wachovia Bank, National Association, which is expected to close this month or next. The company said it does not plan to further comment on current results until it releases its fiscal 2005 full year results early in March.
For more information about Pep Boys, visit: www.pepboys.com .
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