PHILADELPHIA — Pep Boys has announced results for the 13 (third quarter) and 39 (nine months) weeks ended Oct. 29, 2011. Sales for third quarter increased by $25.8 million, or 5.2 percent, to $522.2 million from $496.4 million for the 13 weeks ended Oct. 30, 2010. Net earnings for the third quarter of fiscal 2011 increased to $7 million (13 cents per share) from $5.7 million (11 cents per share) recorded in the same period last year.
 
Sales for the first nine months increased by $47.1 million, or 3.1 percent, to $1,558.3 million from $1,511.3 million for the 39 weeks ended Oct. 30, 2010.  Net earnings for the first nine months of 2011 increased to $33.3 million (62 cents per share) from the $28.3 million (53 cents per share) recorded in the same period last year.
 
The 2011 results include, on a pre-tax basis, a $0.4 million asset impairment charge and $1.5 million of acquisition related expenses and benefitted from the release of $3.6 million of state tax valuation allowances. The 2010 results included, on a pre-tax basis, a $2.6 million gain from the disposition of assets and a $1 million reversal of an inventory related accrual, partially offset by a $1 million asset impairment charge.
 
“Our service business started to rebound during the third quarter,” said President and CEO Mike Odell. “Our ‘surround sound’ marketing effort coupled with lower gas prices and pent-up demand drove strong tire sales in the last month of the quarter, which have continued into the fourth quarter. While our retail business remained soft in a challenging environment for consumers, our service business results and margin enhancement initiatives resulted in our 11th quarter of improved profitability, on a year-over-year basis.”
 
Odell added, “The newest feature of our ‘surround sound’ marketing effort was the launch of TreadSmart during the quarter. Part of our eServe platform, TreadSmart allows customers to research, purchase and schedule the installation of Pep Boys and major brand name tires online at pepboys.com. We call it ‘information-to-installation.’ We are encouraged by the early results of TreadSmart, which was rolled out chain-wide on Oct. 10."
 
“We opened six Service & Tire Centers during the quarter, bringing our total to 159. Due to our acquisitions, we are well ahead of our 2011 targeted openings and expect to continue our aggressive growth in 2012,” added CFO Ray Arthur. “While we expect to be able to continue to fund our strategic growth through our operating cash flow and revolving line of credit, we continue to monitor the credit markets with an eye toward opportunistically refinancing our 2013 and 2014 maturities.”