PetMed Express, Inc. dba PetMeds and parent company of PetCareRx
(NASDAQ: PETS) today announced its financial results for its fourth
quarter and fiscal year ended March 31, 2024.
Quarterly Highlights
- Net sales for the quarter ended
March 31, 2024, were $66.5 million, compared to $62.4 million
for the fourth quarter in the prior year, an increase of 6.6%,
driven by the acquisition of PetCareRx partially offset by a
decline in PetMeds legacy sales.
- Net loss for the quarter ended
March 31, 2024 was $(5.0) million, or $(0.25) diluted earnings
per share. This compares to net loss of $(0.2) million, or $(0.01)
diluted earnings per share, for the prior year quarter ended
March 31, 2023. The increase in the net loss can be
attributed to additional G&A, marketing expenses and an
increase in depreciation and amortization associated with the
acquisition.
- Adjusted EBITDA1 was $0.5 million for
the current year quarter, compared to Adjusted EBITDA of $3.6
million, for the quarter ended March 31, 2023.
Annual Highlights
- Net sales for the fiscal year ended
March 31, 2024, were $281.1 million, compared to $256.6
million for the prior year, an increase of 9.5%, driven by the
acquisition of PetCareRx partially offset by a decline in PetMeds
legacy sales.
- Net loss for the fiscal year ended
March 31, 2024 was $(7.5) million, or $(0.37) diluted earnings
per share. This compares to net income of $5.1 million, or $0.25
diluted earnings per share, for the prior fiscal year ended
March 31, 2023. The net loss can be attributed to additional
G&A, marketing expenses and an increase in depreciation and
amortization. These increases were offset by higher gross margin
associated with PetCareRx as driven by their membership program
fee, partially offset by a decline in PetMeds’ legacy gross
margin.
- Adjusted EBITDA was $8.2 million, for
the fiscal year ended March 31, 2024, compared to Adjusted
EBITDA of $19.8 million for the fiscal year ended March 31,
2023.
“Our results were negatively impacted by a
challenging macro environment and industry dynamics, as well as a
slow down in call center response times due to the implementation
of our new Order Management System and Autoship platforms during
the fourth quarter,” said Sandra Campos, CEO & President. “We
are moving swiftly to continue to improve our systems and processes
to drive a better customer experience, along with investing in
additional technology resources.”
“PetMeds and PetCareRx have been synonymous with
delivering top-quality pet healthcare products for over two
decades, addressing preventive care, chronic and acute medical
needs for dogs, cats, and horses. Each year, millions of customers
trust our integrated ecosystem of pet health and wellness products
and services for the care of their beloved pets.”
Ms. Campos concluded, “Looking ahead to FY2025, our
strategic priorities are focused on driving growth, improving
profitability, and increasing our key customer satisfaction
metrics. Consolidating business operations will simplify our
structure, reduce cost and strengthen alignment across the
organization. We will also sharpen and amplify our messaging with a
comprehensive marketing plan and look to create efficiencies by
leveraging investments in modern customized technology
frameworks.”
This afternoon the Company will host a
conference call to review the quarter’s financial
results.
Time: 4:30 P.M. Eastern Time,
June 11, 2024Public call dial in (877)
407-0789 (toll free) or (201) 689-8562. Webcast
stream link: https://investors.petmeds.com for
those who wish to stream the call via webcast.
Replay: Available until June 25, 2024, at 11:59
P.M Eastern Time. To access the replay, call (844) 512-2921
(toll free) or (412) 317-6671 and enter passcode 13746751.
About PetMed Express, Inc.
Founded in 1996, PetMeds is a leader in pioneering
the digital pet pharmacy industry. As a national online retailer,
PetMeds.com and PetCareRx.com are top choices for delivering
preventive and chronic symptom prescriptions and OTC medications
and products through their thousands of veterinary partners and a
loyal customer base. Leveraging telehealth and insurance
partnerships, they offer value and convenience to pet families at
every stage of their pets' lives, whether dogs, cats, or horses.
PetMeds and PetCareRx provide a comprehensive range of medications,
food products, and essential supplies through their websites,
www.PetMeds.com and www.PetCareRx.com.
Forward Looking Statement
This press release may contain “forward-looking
statements”, within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, that involve a number of risks and
uncertainties, including the Company’s ability to meet the
objectives included in its business plan. Important factors that
could cause results to differ materially from those indicated by
such forward-looking statements are set forth in the “Risk Factors”
and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” sections in the Company’s Annual Report
on Form 10-K/A for the year ended March 31, 2023. The
Company’s future results may also be impacted by other risk factors
listed from time to time in the Company’s filings with the
Securities and Exchange Commission, including, but not limited to,
the Company's Annual Reports on Form 10-K, Quarterly Reports on
Form 10-Q and periodic filings on Form 8-K. You should not place
undue reliance on these forward-looking statements, which apply
only as of the date of this press release and should not be relied
upon as representing the Company’s views as of any subsequent date.
The Company explicitly disclaims any obligation to update any
forward-looking statements, other than as may be required by law.
If the Company does update one or more forward-looking statements,
no inference should be made that the Company will make additional
updates with respect to those or other forward-looking
statements.
Investor Contact:ICR, LLCJohn
Mills(646) 277-1254Reed Anderson(646)
277-1260investor@petmeds.com
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (In
thousands, except for share and per share amounts)
(Unaudited) |
|
|
March 31,2024 |
|
March 31,2023 |
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
55,296 |
|
|
$ |
104,086 |
|
Accounts receivable, less allowance for credit losses of $273 and
$35, respectively |
|
3,283 |
|
|
|
1,740 |
|
Inventories |
|
28,556 |
|
|
|
19,023 |
|
Prepaid expenses and other current assets |
|
6,325 |
|
|
|
4,719 |
|
Prepaid income taxes |
|
188 |
|
|
|
863 |
|
Total current assets |
|
93,648 |
|
|
|
130,431 |
|
|
|
|
|
Noncurrent assets: |
|
|
|
Property and equipment, net |
|
26,657 |
|
|
|
26,178 |
|
Intangible and other assets, net |
|
16,503 |
|
|
|
5,860 |
|
Goodwill |
|
26,658 |
|
|
|
— |
|
Operating lease right-of-use assets, net |
|
1,432 |
|
|
|
— |
|
Deferred tax assets, net |
|
4,986 |
|
|
|
5,009 |
|
Total noncurrent assets |
|
76,236 |
|
|
|
37,047 |
|
|
|
|
|
Total assets |
$ |
169,884 |
|
|
$ |
167,478 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
37,024 |
|
|
$ |
25,208 |
|
Sales tax payable |
|
25,012 |
|
|
|
26,113 |
|
Accrued expenses and other current liabilities |
|
7,060 |
|
|
|
6,191 |
|
Current operating lease liabilities |
|
459 |
|
|
|
— |
|
Deferred revenue |
|
2,603 |
|
|
|
— |
|
Total current liabilities |
|
72,158 |
|
|
|
57,512 |
|
|
|
|
|
Long-term operating lease liabilities |
|
995 |
|
|
|
— |
|
|
|
|
|
Total liabilities |
|
73,153 |
|
|
|
57,512 |
|
|
|
|
|
Shareholders' equity: |
|
|
|
Preferred stock, $.001 par value, 5,000,000 shares authorized;
2,500 convertible shares issued and outstanding with a liquidation
preference of $4 per share |
|
9 |
|
|
|
9 |
|
Common stock, $.001 par value, 40,000,000 shares authorized;
21,148,692 and 21,084,302 shares issued and outstanding,
respectively |
|
21 |
|
|
|
21 |
|
Additional paid-in capital |
|
25,146 |
|
|
|
18,277 |
|
Retained earnings |
|
71,555 |
|
|
|
91,659 |
|
|
|
|
|
Total shareholders' equity |
|
96,731 |
|
|
|
109,966 |
|
|
|
|
|
Total liabilities and shareholders' equity |
$ |
169,884 |
|
|
$ |
167,478 |
|
PETMED EXPRESS, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
(LOSS) INCOME(In thousands, except for share and
per share amounts) (Unaudited) |
|
|
Three Months EndedMarch 31, |
|
Year Ended March 31, |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
Net sales |
$ |
66,504 |
|
|
$ |
62,407 |
|
|
$ |
281,064 |
|
|
$ |
256,579 |
|
Cost of sales |
|
48,327 |
|
|
|
45,025 |
|
|
|
202,416 |
|
|
|
185,844 |
|
|
|
|
|
|
|
|
|
Gross profit |
|
18,177 |
|
|
|
17,382 |
|
|
|
78,648 |
|
|
|
70,735 |
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
General and administrative |
|
14,148 |
|
|
|
12,045 |
|
|
|
55,246 |
|
|
|
41,714 |
|
Advertising |
|
5,969 |
|
|
|
4,555 |
|
|
|
24,508 |
|
|
|
19,424 |
|
Depreciation and amortization |
|
1,895 |
|
|
|
994 |
|
|
|
7,056 |
|
|
|
3,546 |
|
Total operating expenses |
|
22,012 |
|
|
|
17,594 |
|
|
|
86,810 |
|
|
|
64,684 |
|
|
|
|
|
|
|
|
|
(Loss) income from operations |
|
(3,835 |
) |
|
|
(212 |
) |
|
|
(8,162 |
) |
|
|
6,051 |
|
|
|
|
|
|
|
|
|
Other income: |
|
|
|
|
|
|
|
Interest income (expense), net |
|
30 |
|
|
|
439 |
|
|
|
511 |
|
|
|
450 |
|
Other, net |
|
325 |
|
|
|
226 |
|
|
|
1,378 |
|
|
|
944 |
|
Total other income (expense) |
|
355 |
|
|
|
665 |
|
|
|
1,889 |
|
|
|
1,394 |
|
|
|
|
|
|
|
|
|
(Loss) income before provision for income taxes |
|
(3,480 |
) |
|
|
453 |
|
|
|
(6,273 |
) |
|
|
7,445 |
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
1,536 |
|
|
|
669 |
|
|
|
1,191 |
|
|
|
2,305 |
|
|
|
|
|
|
|
|
|
Net (loss) income |
$ |
(5,016 |
) |
|
$ |
(216 |
) |
|
$ |
(7,464 |
) |
|
$ |
5,140 |
|
|
|
|
|
|
|
|
|
Net (loss) income per common share: |
|
|
|
|
|
|
|
Basic |
$ |
(0.25 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.37 |
) |
|
$ |
0.25 |
|
Diluted |
$ |
(0.25 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.37 |
) |
|
$ |
0.25 |
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
20,443,052 |
|
|
|
20,328,688 |
|
|
|
20,395,959 |
|
|
|
20,274,786 |
|
Diluted |
|
20,443,052 |
|
|
|
20,328,688 |
|
|
|
20,395,959 |
|
|
|
20,339,002 |
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share |
$ |
— |
|
|
$ |
0.30 |
|
|
$ |
0.60 |
|
|
$ |
1.20 |
|
PETMED EXPRESS, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS(In thousands) (Unaudited) |
|
|
Year Ended March 31, |
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating activities: |
|
|
|
Net (loss) income |
$ |
(7,464 |
) |
|
$ |
5,140 |
|
Adjustments to reconcile net (loss) income to net cash provided by
operating activities: |
|
|
|
Depreciation and amortization |
|
7,056 |
|
|
|
3,546 |
|
Share based compensation |
|
6,869 |
|
|
|
6,617 |
|
Deferred income taxes |
|
292 |
|
|
|
(1,630 |
) |
Bad debt expense |
|
324 |
|
|
|
214 |
|
(Increase) decrease in operating assets and increase (decrease) in
liabilities: |
|
|
|
Accounts receivable |
|
(1,742 |
) |
|
|
(41 |
) |
Inventories |
|
(6,417 |
) |
|
|
13,432 |
|
Prepaid income taxes |
|
675 |
|
|
|
(182 |
) |
Prepaid expenses and other current assets |
|
(185 |
) |
|
|
147 |
|
Operating lease right-of-use assets, net |
|
788 |
|
|
|
— |
|
Accounts payable |
|
6,102 |
|
|
|
(2,292 |
) |
Sales tax payable |
|
(1,101 |
) |
|
|
1,956 |
|
Accrued expenses and other current liabilities |
|
276 |
|
|
|
896 |
|
Operating lease liabilities |
|
(766 |
) |
|
|
— |
|
Deferred revenue |
|
(390 |
) |
|
|
— |
|
Net cash provided by operating activities |
|
4,318 |
|
|
|
27,803 |
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
Purchase of minority interest investment in Vetster |
|
(300 |
) |
|
|
(5,000 |
) |
Acquisition of PetCareRx, net of cash acquired |
|
(35,859 |
) |
|
|
— |
|
Purchases of property and equipment |
|
(4,511 |
) |
|
|
(5,260 |
) |
Net cash used in investing activities |
|
(40,670 |
) |
|
|
(10,260 |
) |
|
|
|
|
Cash flows from financing activities: |
|
|
|
Dividends paid |
|
(12,437 |
) |
|
|
(24,537 |
) |
Net cash used in financing activities |
|
(12,437 |
) |
|
|
(24,537 |
) |
|
|
|
|
Net decrease in cash and cash equivalents |
|
(48,789 |
) |
|
|
(6,994 |
) |
Cash and cash equivalents, at beginning of fiscal year |
|
104,086 |
|
|
|
111,080 |
|
|
|
|
|
Cash and cash equivalents, at end of fiscal year |
$ |
55,296 |
|
|
$ |
104,086 |
|
|
|
|
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
|
Cash paid for income taxes |
$ |
130 |
|
|
$ |
4,312 |
|
|
|
|
|
Dividends payable in accrued expenses |
$ |
1,466 |
|
|
$ |
1,262 |
|
|
Non-GAAP Financial Measures
To provide investors and the market with
additional information regarding our financial results, we have
disclosed (see below) adjusted EBITDA, a non-GAAP financial measure
that we calculate as net income excluding share-based compensation
expense; depreciation and amortization; income tax provision;
interest income (expense); and other non-operational expenses. We
have provided reconciliations below of adjusted EBITDA to net
income, the most directly comparable GAAP financial measures.
We have included adjusted EBITDA, herein,
because it is a key measure used by our management and Board of
Directors to evaluate our operating performance, generate future
operating plans, and make strategic decisions regarding the
allocation of capital. In particular, the exclusion of certain
expenses in calculating adjusted EBITDA facilitates operating
performance comparability across reporting periods by removing the
effect of non-cash expenses and other expenses. Accordingly, we
believe that adjusted EBITDA provides useful information to
investors and others in understanding and evaluating our operating
results in the same manner as our management and Board of
Directors.
We believe it is useful to exclude non-cash
charges, such as share-based compensation expense, depreciation and
amortization from our adjusted EBITDA because the amount of such
expenses in any specific period may not directly correlate to the
underlying performance of our business operations. We believe it is
useful to exclude income tax provision and interest income
(expense), as neither are components of our core business
operations. We also believe that it is useful to exclude other
expenses, including the investment banking fee related to the
Vetster partnership, acquisition costs related to PetCareRx,
employee severance and an estimated state sales tax accrual as
these items are not indicative of our ongoing operations. Adjusted
EBITDA has limitations as a financial measure, and these non-GAAP
measures should not be considered in isolation or as a substitute
for analysis of our results as reported under GAAP. Some of these
limitations are:
- Although
depreciation and amortization are non-cash charges, the assets
being depreciated may have to be replaced in the future and
adjusted EBITDA does not reflect capital expenditure requirements
for such replacements or for new capital expenditures;
- Adjusted EBITDA does not reflect
share-based compensation. Share-based compensation has been, and
will continue to be for the foreseeable future, a material
recurring expense in our business and an important part of our
compensation strategy;
- Adjusted EBITDA does not reflect
interest income (expense), net; or changes in, or cash requirements
for, our working capital;
- Adjusted EBITDA does not reflect
transaction related costs and other items which are either not
representative of our underlying operations or are incremental
costs that result from an actual or planned transaction and include
litigation matters, integration consulting fees, internal salaries
and wages (to the extent the individuals are assigned full-time to
integration and transformation activities) and certain costs
related to integrating and converging IT systems;
- Adjusted EBITDA does not reflect
certain non-operating expenses including the employee severance
which reduces cash available to us;
- Adjusted EBITDA does not reflect non
operating expenses (income) including sales tax expense (income)
relating to recording a liability for sales tax we did not collect
from our customers or recognizing a gain on settlement from
settling a state liability for less than recorded.
- Other companies, including
companies in our industry, may calculate adjusted EBITDA
differently, which reduces the measures usefulness as comparative
measures.
Because of these and other limitations, Adjusted
EBITDA should only be considered as supplemental to, and alongside
with other GAAP based financial performance measures, including
various cash flow metrics, net income, net margin, and our other
GAAP results. The following table presents a reconciliation of net
income, the most directly comparable GAAP measure to Adjusted
EBITDA for each of the periods indicated:
Reconciliation of Unaudited Non-GAAP
MeasuresPetMed Express, Inc. |
|
|
Three Months Ended |
|
|
|
|
($ in thousands, except percentages) |
March 31,2024 |
|
March 31,2023 |
|
$Change |
|
%Change |
|
|
|
|
|
|
|
|
Consolidated Reconciliation of GAAP Net Loss to Adjusted
EBITDA: |
|
|
|
|
|
|
|
|
Net loss |
$ |
(5,016 |
) |
|
$ |
(216 |
) |
|
$ |
(4,800 |
) |
|
2222 |
% |
|
|
|
|
|
|
|
|
Add (subtract): |
|
|
|
|
|
|
|
Share-based Compensation |
$ |
1,674 |
|
|
$ |
1,630 |
|
|
$ |
44 |
|
|
3 |
% |
Income Taxes |
$ |
1,536 |
|
|
$ |
669 |
|
|
$ |
867 |
|
|
130 |
% |
Depreciation and amortization |
$ |
1,895 |
|
|
$ |
994 |
|
|
$ |
901 |
|
|
91 |
% |
Interest Income |
$ |
(30 |
) |
|
$ |
(439 |
) |
|
$ |
409 |
|
|
(93 |
)% |
Acquisition/Partnership Transactions and Other
Items |
$ |
385 |
|
|
$ |
1,010 |
|
|
$ |
(625 |
) |
|
(62 |
)% |
Employee Severance |
$ |
104 |
|
|
$ |
— |
|
|
$ |
104 |
|
|
n/m |
|
Adjusted EBITDA |
$ |
548 |
|
|
$ |
3,648 |
|
|
$ |
(3,100 |
) |
|
(85 |
)% |
|
Year Ended |
|
|
|
|
($ in thousands, except percentages) |
March 31,2024 |
|
March 31,2023 |
|
$Change |
|
%Change |
|
|
|
|
|
|
|
|
Consolidated Reconciliation of GAAP Net (Loss) Income to
Adjusted EBITDA: |
|
|
|
|
|
|
|
|
Net (loss) income |
$ |
(7,464 |
) |
|
$ |
5,140 |
|
|
$ |
(12,604 |
) |
|
(245 |
)% |
|
|
|
|
|
|
|
|
Add (subtract): |
|
|
|
|
|
|
|
Share-based Compensation |
$ |
6,870 |
|
|
$ |
6,617 |
|
|
$ |
253 |
|
|
4 |
% |
Income Taxes |
$ |
1,191 |
|
|
$ |
2,305 |
|
|
$ |
(1,114 |
) |
|
(48 |
)% |
Depreciation and amortization |
$ |
7,056 |
|
|
$ |
3,546 |
|
|
$ |
3,510 |
|
|
99 |
% |
Interest Income |
$ |
(511 |
) |
|
$ |
(450 |
) |
|
$ |
(61 |
) |
|
14 |
% |
Acquisition/Partnership Transactions and Other
Items |
$ |
1,679 |
|
|
$ |
1,904 |
|
|
$ |
(225 |
) |
|
(12 |
)% |
Employee Severance |
$ |
512 |
|
|
$ |
364 |
|
|
$ |
148 |
|
|
41 |
% |
Sales Tax Expense (Income) |
$ |
(1,088 |
) |
|
$ |
344 |
|
|
$ |
(1,432 |
) |
|
(416 |
)% |
Adjusted EBITDA |
$ |
8,245 |
|
|
$ |
19,770 |
|
|
$ |
(11,525 |
) |
|
(58 |
)% |
1 Adjusted EBITDA is a non-GAAP financial measure.
See “Non-GAAP Financial Measures” for additional information on
non-GAAP financial measures and a reconciliation to the most
comparable GAAP measures.
PetMed Express (NASDAQ:PETS)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
PetMed Express (NASDAQ:PETS)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024