Pets-Mart: Comparable store sales grew 4.8 percent

The company reported first quarter net income of $24.6 million, or $0.17 per share on a diluted basis. That compares with net income of $22.1 million, or $0.17 per share, for the first quarter of 2002, when the company had 6.2 million fewer shares outstanding. During the first quarter of 2003 the company opened 19 new stores. Net sales for the first quarter of 2003 were $696.8 million, compared to $645.8 million for the same period last year. Comparable store sales, or sales in stores open at least a year, grew 4.8 percent over the first quarter of last year, when the company turned in comparable store sales growth of 12.1 percent. Pet services sales for the first quarter were $45.5 million, up $8.3 million or 22.3 percent over the first quarter of last year, an increase that reflects the company's focus and investment in growing its grooming and training businesses. For the first quarter of 2003, gross margins were 29.5 percent, up 140 basis points from the first quarter of 2002. Operating, general and administrative expenses were 23.1 percent of net sales, compared with 21.7 percent in the first quarter of last year, and the company said it expects to begin to leverage expenses in the latter half of 2003. The company generated pre-tax income of 5.8 percent in the first quarter of 2003 and continues to project pre-tax income of 7 percent for the full year. Pets-Mart projected its second quarter 2003 comparable store sales at 5 to 6 percent, and said it is comfortable with Wall Street's second quarter earnings per share projection of approximately $0.17.