PHILADELPHIA — Pep Boys has announced the following results for the 13 (third quarter) and 39 weeks (nine months) ended Nov. 1.
Third quarter sales were $464.2 million as compared to $528.8 million in 2007. Comparable sales decreased 10.4 percent , including a 10.3 percent comparable merchandise sales decrease and an 11 percent comparable service revenue decrease. In accordance with GAAP, merchandise sales includes merchandise sold through both our retail and service center lines of business, and service revenue is limited to labor sales. Re-categorizing sales into the respective lines of business from which they are generated, comparable service center revenue (labor plus installed merchandise and tires) decreased 8.2 percent , while comparable retail sales (DIY and Commercial) decreased 12.1 percent .
Net Loss was $7.3 million or (14 cents) per share (basic and diluted) as compared to a loss of $28 million or (54 cents) per share (basic and diluted) in 2007. Net Loss for the third quarter of 2007 included $50 million in pre-tax costs for an inventory write down, asset impairment and increased legal reserves.
Sales were $1,462.3 million as compared to $1,620.4 million in 2007. Comparable sales decreased 7.8 percent, including an 8.1 percent comparable merchandise sales decrease and a 6.3 percent comparable service revenue decrease. In accordance with GAAP, merchandise sales includes merchandise sold through both our retail and service center lines of business, and service revenue is limited to labor sales. Re-categorizing sales into the respective lines of business from which they are generated, comparable service center revenue (labor plus installed merchandise and tires) decreased 3.2 percent, while comparable retail sales (DIY and Commercial) decreased 11.3 percent.
Net Earnings were $2.8 million or 5 cents per share (basic and diluted) as compared to a net loss of $20.6 million or (40 cents) per share (basic and diluted) in 2007.
“Our sales and operating results have been impacted by the decrease in miles driven and the general reduction in consumer spending. To offset these trends, we continue to focus on implementing our strategic plan, serving our customers well, tightly controlling spending and promoting the fact that ‘Pep Boys Does Everything. For Less..’," said CEO Mike Odell. “Pep Boys is the place to go for great prices on tires, oil changes and automotive maintenance and repairs – whether the customer is a Do It Yourselfer or wants our ASE-certified technicians to do it for them. With many dealerships and smaller shops currently closing, now is the time for the cost-conscious consumer to discover the value at Pep Boys.”
“Our liquidity position remains strong,” commented CFO Ray Arthur. “As of the end of Q3, we had $38.4 million cash on hand, an undrawn revolving credit facility and no significant debt maturities due until 2013. A year in advance of the Dec. 9, 2009 maturity of our current revolving credit facility, we have secured commitments from a syndicate led by Bank of America for a $300 million replacement facility. This facility is expected to close, subject to the satisfaction of customary closing conditions, before our fiscal year ends on Jan. 31, 2009.”
