PHILADELPHIA — Pep Boys has announced results for the first quarter ended April 30.
Sales for the first quarter increased by $3.5 million, or 0.7 percent, to $513.5 million from $510 million for the prior year’s first quarter, ended May 1, 2010. Comparable sales decreased 0.6 percent, consisting of a 1.6 percent comparable service revenue increase and a 1.2 percent comparable merchandise sales decrease.
Net earnings for the first quarter of fiscal 2011 increased to $12.4 million (23 cents per share) from $12 million (23 cents per share) recorded in the same period last year.
“We recognize that our customers’ spending is constrained due to gas prices, and that the rainy spring reduced demand for appearance products, but this does not alter our long-term strategy to be the automotive solutions provider of choice for the value-oriented customer,” said President and CEO Mike Odell. “In fact, we deliver a great value every day, which is well-suited to the needs of our customers.”
Odell continued, “In the face of these macroeconomic trends, we continued to improve our operational disciplines and achieved our ninth consecutive quarter of improved profitability (period-over-period). Our service business, which is the lead business in our transformation, continued its positive sales comp trend and continues to grow through the addition of Service & Tire Centers. During the first quarter, we opened nine new locations, including the acquisition of seven locations in Seattle-Tacoma. In May, we acquired 85 Big 10 locations in Florida, Georgia and Alabama. This brings the total number of Service & Tire Centers currently in operation to 147.”
“After funding all of our Service & Tire Center acquisitions to date with cash on hand, we currently have approximately $50 million in cash and remain undrawn on our revolver,” said CFO Ray Arthur. “In addition, we recently had our owned store real estate reappraised at a value of approximately $690 million, of which half is unencumbered. All of which translates into a balance sheet that is well-positioned to continue our aggressive growth.”
