PetMed Express Inc. (NASDAQ:PETS) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.
PetMed Express Inc. Earnings Cheat Sheet
Results: Adjusted Earnings Per Share increased 15% to $0.23 in the quarter versus EPS of $0.20 in the year-earlier quarter.
Revenue: Decreased 8.62% to $51.1 million from the year-earlier quarter.
Actual vs. Wall St. Expectations: PetMed Express Inc. reported adjusted EPS income of $0.23 per share. By that measure, the company beat the mean analyst estimate of $0.21. It missed the average revenue estimate of $55.26 million.
Quoting Management: Menderes Akdag, President and CEO, commented: “We were able to increase our gross margins and decrease our operational expenses to improve our bottom line results for the quarter and fiscal year. For the quarter ended March 31, 2013 our gross profit increased 175 basis points, which can be attributed to a change in our product mix to higher margin items, including generics. For the quarter ended March 31, 2013 our operating expenses decreased by 124 basis points, mainly due to a reduction in advertising spending. Sales were negatively impacted during the quarter due to the colder than normal weather. The unavailability of Novartis brands, due to the manufacturer’s suspended production, negatively impacted our sales for fiscal 2013; however recently this suspension was lifted for certain brands. Average order value was $73 for the fiscal year compared to $76 for the prior fiscal year, which was due to a change in product mix to lower priced items including generics and additional discounts given to customers. During the fiscal year, we maintained our quarterly dividend at $0.15 per share, while also paying a one-time special dividend of $1.00 in December 2012. In accordance with our share repurchase program, we repurchased approximately 397,000 shares paying approximately $3.9 million in fiscal 2013, with $10.2 million remaining as of March 31, 2013. For fiscal 2014 we are focusing on increasing our advertising spending to improve new order sales, shifting sales to higher margin items while continuing to expand our product offerings.”
Key Stats (on next page)…
Revenue increased 3% from $49.61 million in the previous quarter. EPS were the same at $0.23 as the previous quarter.
Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.21 to a profit $0.22. For the current year, the average estimate has moved up from a profit of $0.83 to a profit of $0.84 over the last ninety days.
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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)