UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): May 14, 2007
PetMed Express, Inc.
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(Exact name of registrant as specified in its charter)
Florida 000-28827 65-0680967
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation File Number) Identification No.)
1441 S.W. 29th Avenue, Pompano Beach, FL 33069
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(Address of principal executive offices) (Zip Code)
(954) 979-5995
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation
of the registrant under any of the following provisions
(see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
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Item 8.01 Other Events.
On May 14, 2007, PetMed Express, Inc. issued a press release
announcing its March 31, 2007 year end financial results. A copy
of this press release is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
99.1 - Press release dated May 14, 2007.
EXHIBIT INDEX
Exhibit No. Description
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99.1 Press release dated May 14, 2007
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
Dated: May 15, 2007
PETMED EXPRESS, INC.
By:/s/ Bruce S. Rosenbloom
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Name: Bruce S. Rosenbloom
Title: Chief Financial Officer
2
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Exhibit 99.1
PETMED EXPRESS D/B/A 1-800-PETMEDS ANNOUNCES FINANCIAL RESULTS
FOR FISCAL 2007 - FOURTH QUARTER SALES INCREASE 24%
Pompano Beach, Florida, May 14, 2007 - PetMed Express, Inc.
(NASDAQ: PETS) today announced its financial results for the
fiscal year ended March 31, 2007. Net sales for the year ended
March 31, 2007 were $162.2 million, compared to $137.6 million
for the year ended March 31, 2006, an increase of 18%. Net
income was $14.4 million, or $0.60 diluted per share, for the
year ended March 31, 2007, compared to net income of $12.1
million, or $0.50 diluted per share, for the year ended March 31,
2006, an increase to net income of 20%. For the year ended March
31, 2007 the Company incurred $893,000 of stock option
compensation expense due to the adoption of "Financial Accounting
Standard 123R" on April 1, 2006. The Company acquired
approximately 681,000 new customers during the fiscal year
compared to 624,000 during the prior year. Approximately 62%
of all orders were placed on our website during the fiscal year.
For the quarter ended March 31, 2007, net sales were $36.4
million, compared to $29.4 million for the quarter ended March
31, 2006, an increase of 24%. Net income for the quarter ended
March 31, 2007 was $3.6 million, or $0.15 diluted per share,
compared to net income of $3.1 million, or $0.13 diluted per
share, for the same quarter the prior year, an increase to net
income of 15%. The Company acquired approximately 132,000 new
customers during the fourth fiscal quarter compared to 94,000
new customers for the same quarter in the prior year.
Mendo Akdag, CEO and President, commented: "We are pleased to
report that our retail reorder sales increased 25%, from $88.4
million to $110.5 million, for the years ended March 31, 2006
and 2007, respectively. We are also pleased to report that
new order sales increased 40%, from $7.1 million to $9.9
million, for the quarters ended March 31, 2006 and 2007,
respectively. Our new advertising campaign featuring
America's Sweetheart Betty White, which started in January
2007, was instrumental in decreasing the advertising cost to
acquire a new customer by 17%, from $41 to $34 for the quarters
ended March 31, 2006 and 2007, respectively. Additionally, net
cash provided by operating activities increased by $6.3
million, from $10.3 million for the year ended March 31, 2006 to
$16.6 million for the year ended March 31, 2007, an increase of
61%. Our focus in fiscal 2008 will be on capturing additional
market share, and improving reorders and our customer service
levels."
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 (888) 455-
1758 (toll free) or (312) 470-7365. 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 A.M. on May 14, 2007 until May 28, 2007 at 11:59
P.M. To access the replay, call (866) 507-3617 (toll free) or
(203) 369-1891, 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 1800-
PetMeds toll free number and on the Internet through its
website at www.1800petmeds.com.
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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, 2006. 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, 954-979-5995.
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Exhibit 99.1 Page 1 of 4
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PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31,
2007 2006
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ASSETS
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Current assets:
Cash and cash equivalents $ 316,470 $ 366,907
Temporary investments 39,125,000 22,850,000
Accounts receivable, less allowance for doubtful
accounts of $28,000 and $23,000, respectively 1,369,521 1,155,781
Inventories - finished goods 16,086,207 14,997,675
Prepaid expenses and other current assets 1,071,171 583,038
Total current assets 57,968,369 39,953,401
Property and equipment, net 1,990,578 1,497,589
Deferred income taxes 894,540 794,002
Intangible asset 365,000 365,000
Other assets - 14,167
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Total assets $ 61,218,487 $ 42,624,159
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LIABILITIES AND SHAREHOLDERS' EQUITY
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Current liabilities:
Accounts payable $ 5,859,756 $ 3,052,953
Income taxes payable 229,321 958,318
Accrued expenses and other current liabilities 1,265,837 973,359
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Total liabilities 7,354,914 4,984,630
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Commitments and contingencies
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 8,898 8,898
Common stock, $.001 par value, 40,000,000 shares
authorized; 24,309,417 and 23,967,390 shares
issued and outstanding, respectively 24,309 23,967
Additional paid-in capital 15,213,254 13,433,054
Retained earnings 38,617,112 24,173,610
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Total shareholders' equity 53,863,573 37,639,529
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Total liabilities and shareholders' equity $ 61,218,487 $ 42,624,159
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Exhibit 99.1 Page 2 of 4
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Year Ended March 31, Quarter Ended March 31,
2007 2006 2007 2006
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(UNAUDITED)
Sales $ 162,246,407 $ 137,583,155 $ 36,408,023 $ 29,408,628
Cost of sales 97,680,238 83,244,366 21,677,697 17,055,657
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Gross profit 64,566,169 54,338,789 14,730,326 12,352,971
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Operating expenses:
General and administrative 17,292,675 14,078,343 4,500,498 3,356,192
Advertising 25,243,029 21,570,667 4,472,329 3,854,433
Depreciation and amortization 530,440 544,535 134,933 149,607
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Total operating expenses 43,066,144 36,193,545 9,107,760 7,360,232
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Income from operations 21,500,025 18,145,244 5,622,566 4,992,739
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Other income (expense):
Interest income, net 1,266,150 676,083 349,025 208,341
Other, net 435,824 215,586 103,695 44,331
Loss on disposal of property and equipment (1,250) (1,719) - (1,719)
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Total other income (expense) 1,700,724 889,950 452,720 250,953
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Income before provision for income taxes 23,200,749 19,035,194 6,075,286 5,243,692
Provision for income taxes 8,757,247 6,971,680 2,451,247 2,104,682
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Net income $ 14,443,502 $ 12,063,514 $ 3,624,039 $ 3,139,010
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Net income per common share:
Basic $ 0.60 $ 0.51 $ 0.15 $ 0.13
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Diluted $ 0.60 $ 0.50 $ 0.15 $ 0.13
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Weighted average number of common shares outstanding:
Basic 24,109,035 23,658,722 24,151,983 23,923,062
============= ============= ============= =============
Diluted 24,270,879 24,211,955 24,329,822 24,432,319
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Exhibit 99.1 Page 3 of 4
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended
March 31,
2007 2006
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Cash flows from operating activities:
Net income $ 14,443,502 $ 12,063,514
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 530,440 544,535
Share based compensation 1,095,740 -
Tax benefit related to stock options exercised - 342,920
Deferred income taxes (100,538) (211,156)
Loss on disposal of property and equipment 1,250 1,719
Bad debt expense (recovery) 29,554 (1,709)
(Increase) decrease in operating assets
and increase (decrease) in liabilities:
Accounts receivable (243,294) 642,684
Inventories - finished goods (1,088,532) (3,817,342)
Prepaid expenses and other current assets (488,133) (369,886)
Other assets 14,167 -
Accounts payable 2,806,803 327,963
Income taxes payable (728,997) 356,783
Accrued expenses and other current
liabilities 292,478 397,465
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Net cash provided by operating activities 16,564,440 10,277,490
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Cash flows from investing activities:
Net change in temporary investments (16,275,000) (11,050,000)
Purchases of property and equipment (1,025,079) (758,176)
Net proceeds from the sale of property and equipment 400 600
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Net cash used in investing activities (17,299,679) (11,807,576)
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Cash flows from financing activities:
Proceeds from the exercise of stock options and
warrants and other transactions 442,084 1,016,031
Tax benefit related to stock options exercised 242,718 -
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Net cash provided by financing activities 684,802 1,016,031
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Net increase in cash and cash equivalents (50,437) (514,055)
Cash and cash equivalents, at beginning of the year 366,907 880,962
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Cash and cash equivalents, at end of the year $ 316,470 $ 366,907
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Supplemental disclosure of cash flow information:
Cash paid for income taxes $ 9,344,063 $ 6,483,132
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Exhibit 99.1 Page 4 of 4