PetMed Express, Inc. d/b/a 1-800-PetMeds Announces Its Fourth Quarter and Fiscal Year End Financial Results and Increases Its Quarterly Dividend to $0.28 per Share

15% Increase in 4^th Quarter Sales
8.4% Increase in 4^th Quarter Diluted Earnings per Share
5% Increase in 4^th Quarter New Order Sales

DELRAY BEACH, Fla., May 04, 2020 (GLOBE NEWSWIRE) -- PetMed Express, Inc. (NASDAQ: PETS) today announced its financial results for its fourth quarter and fiscal year ended March 31, 2020. Net sales for the quarter ended March 31, 2020 were $74.3 million, compared to $64.6 million for the quarter ended March 31, 2019, an increase of 15%. Net income for the quarter ended March 31, 2020 was $7.0 million, or $0.35 diluted per share, compared to net income of $6.6 million, or $0.32 diluted per share, for the same quarter the prior year, an increase to diluted earnings per share of 8.4%. Reorder sales for the three months ended March 31, 2020 were $65.2 million, compared to $55.9 million for the three months ended March 31, 2019, an increase of 17%. New order sales for the three months ended March 31, 2020 were $9.1 million, compared to $8.7 million for the three months ended March 31, 2019, an increase of 5%. The Company acquired approximately 107,000 new customers in the quarter ended March 31, 2020, compared to 101,000 new customers in the same period the prior year. The average order size for the quarter ended March 31, 2020 was $90, compared to $85 for the quarter ended March 31, 2019.

Menderes Akdag, President and CEO, commented: “During the March quarter, due to COVID-19, demand has been strong for the ecommerce channel, with consumers shifting their purchases to online, which has positively impacted our sales. We were more efficient with our advertising in the fourth quarter, and we will continue to focus on optimizing our marketing plan in fiscal 2021. As an essential business, we have been open during our normal business hours without any material disruptions in our operations. We are dedicated to making every effort to ensure pets get the medications they need in these challenging times. We have also taken extra precautions to ensure the health and safety of our employees. Also, so far, we have not seen any material disruptions in our supply chain. But, as it is a fluid situation, we are monitoring and managing it closely. In fiscal 2021, we will continue to be price competitive and will increase advertising to acquire new customers, promote brand awareness, and reinforce brand loyalty.”

The Board of Directors declared an increased quarterly dividend from $0.27 to $0.28 per share on its common stock. The dividend will be payable on May 22, 2020, to shareholders of record at the close of business on May 15, 2020. The Company intends to continue to pay regular quarterly dividends; however the declaration and payment of future dividends is discretionary and will be subject to a determination by the Board of Directors each quarter following its review of the Company’s financial performance.

This morning at 8:30 A.M. Eastern Time, Mr. Akdag will host a conference call to review the year-end financial results. To access the call which is open to the public, dial [phone] (toll free) or [phone]. Please call in fifteen minutes prior to the scheduled start time. Callers will be required to supply PETMEDS as the passcode. For those unable to participate in the live event, the call will be available for replay from 10:00 A.M. Eastern Time on May 4, 2020 until May 18, 2020 at 11:59 P.M. To access the replay, call [phone] (toll free) or [phone] and enter passcode 5500. Founded in 1996, PetMed Express is America’s Largest Pet Pharmacy, delivering prescription and non-prescription pet medications and other health products for dogs, cats, and horses at competitive prices direct to the consumer through its 1-800-PetMeds toll free number and on the Internet through its website at www.1800petmeds.com. 

This press release may contain “forward-looking” statements, as defined in the Private Securities Litigation Reform Act of 1995 or by the Securities and Exchange Commission, 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 Management’s Discussion and Analysis of Financial Condition and Results of Operations in the PetMed Express Annual Report on Form 10-K for the year ended March 31, 2019. The Company’s future results may also be impacted by other risk factors listed from time to time in its SEC filings, including, but not limited to, the Company's Form 10-Q and its Annual Report on Form 10-K. 

For investment relations contact PetMed Express, Inc., Bruce S. Rosenbloom, CFO, 561-526-4444.

PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except for per share amounts)
		March 31,		March 31,
		2020		2019
ASSETS		(UNAUDITED)
Current assets:
Cash and cash equivalents	$	103,762	$	100,529
Accounts receivable, less allowance for doubtful
accounts of $59 and $39, respectively		3,843		2,542
Inventories - finished goods		17,884		21,370
Prepaid expenses and other current assets		3,529		1,408
Prepaid income taxes		-		582
Total current assets		129,018		126,431
Noncurrent assets:
Property and equipment, net		25,445		27,136
Intangible assets		860		860
Total noncurrent assets		26,305		27,996
Total assets	$	155,323	$	154,427
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	19,658	$	16,275
Accrued expenses and other current liabilities		4,214		2,351
Income taxes payable		471		-
Total current liabilities		24,343		18,626
Deferred tax liabilities		970		1,121
Total liabilities		25,313		19,747
Commitments and contingencies
Shareholders' equity:
Preferred stock, $.001 par value, 5,000 shares authorized;
3 convertible shares issued and outstanding with a
liquidation preference of $4 per share		9		9
Common stock, $.001 par value, 40,000 shares authorized;
20,166 and 20,674 shares issued and outstanding, respectively		20		21
Additional paid-in capital		3,804		12,478
Retained earnings		126,177		122,172
Total shareholders' equity		130,010		134,680
Total liabilities and shareholders' equity	$	155,323	$	154,427

PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands, except for per share amount)
		Three Months Ended				Year Ended
		March 31,				March 31,
		2020		2019		2020		2019
		(UNAUDITED)				(UNAUDITED)
Sales	$	74,286	$	64,565	$	284,125	$	283,419
Cost of sales		52,600		43,841		202,879		188,105
Gross profit		21,686		20,724		81,246		95,314
Operating expenses:
General and administrative		6,413		5,840		25,264		24,767
Advertising		6,205		6,522		22,748		22,148
Depreciation		555		560		2,257		2,225
Total operating expenses		13,173		12,922		50,269		49,140
Income from operations		8,513		7,802		30,977		46,174
Other income:
Interest income, net		300		549		1,747		1,864
Other, net		307		256		1,169		1,083
Total other income		607		805		2,916		2,947
Income before provision for income taxes		9,120		8,607		33,893		49,121
Provision for income taxes		2,117		1,987		8,042		11,381
Net income	$	7,003	$	6,620	$	25,851	$	37,740
Comprehensive income	$	7,003	$	6,620	$	25,851	$	37,740
Net income per common share:
Basic	$	0.35	$	0.32	$	1.29	$	1.84
Diluted	$	0.35	$	0.32	$	1.29	$	1.84
Weighted average number of common shares outstanding:
Basic		19,984		20,491		20,041		20,461
Diluted		20,010		20,501		20,055		20,491
Cash dividends declared per common share	$	0.27	$	0.27	$	1.08	$	1.06

PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
		Year Ended
		March 31,
		2020			2019
		(UNAUDITED)
Cash flows from operating activities:
Net income	$	25,851		$	37,740
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation		2,257			2,225
Share based compensation		2,822			3,097
Deferred income taxes		(151	)		125
Bad debt expense		191			85
(Increase) decrease in operating assets
and increase (decrease) in liabilities:
Accounts receivable		(1,492	)		(335	)
Inventories - finished goods		3,486			1,967
Prepaid income taxes		582			206
Prepaid expenses and other current assets		(376	)		(526	)
Accounts payable		3,383			1,001
Accrued expenses and other current liabilities		1,820			(447	)
Income taxes payable		471			-
Net cash provided by operating activities		38,844			45,138
Cash flows from investing activities:
Purchases of property and equipment		(2,311	)		(620	)
Net cash used in investing activities		(2,311	)		(620	)
Cash flows from financing activities:
Dividends paid		(21,803	)		(21,925	)
Repurchase and retirement of common stock		(11,497	)		-
Net cash used in financing activities		(33,300	)		(21,925	)
Net increase in cash and cash equivalents		3,233			22,593
Cash and cash equivalents, at beginning of year		100,529			77,936
Cash and cash equivalents, at end of year	$	103,762		$	100,529
Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	7,140		$	11,051
Property and equipment in current assets	$	1,745		$	-
Dividends payable in accrued expenses	$	246		$	203