Fourth Quarter Net Income Increased 9.4% Fourth Quarter Sales Increased 2.8% Quarterly Dividend Increased 5.9%

POMPANO BEACH, Fla., May 4, 2015 (GLOBE NEWSWIRE) -- PetMed Express, Inc. (Nasdaq:PETS) today announced its financial results for the fiscal year ended March 31, 2015. Net income for the quarter ended March 31, 2015 was $5.0 million, or $0.25 diluted per share, compared to net income of $4.5 million, or $0.23 diluted per share, for the same quarter the prior year, an increase to net income of 9.4%. Excluding a one-time charge for an IT-related discontinued project in the quarter ended September 30, 2014, net income for the fiscal year ended March 31, 2015 was $18.5 million, or $0.92 diluted per share, compared to net income of $18.0 million, or $0.90 diluted per share, for the fiscal year ended March 31, 2014, an increase to net income of 3.1%. The one-time IT-related discontinued project cost of $1.7 million was expensed in the September quarter. The after tax net impact of this charge was $1.1 million, or $0.05 diluted per share. There are no further charges expected in the future related to this discontinued project. Net sales for the quarter ended March 31, 2015 were $50.0 million, compared to $48.6 million for the quarter ended March 31, 2014, an increase of 2.8%. For the fiscal year ended March 31, 2015 net sales were $229.4 million, compared to $233.4 million for the fiscal year ended March 31, 2014, a decrease of 1.7%. Online sales for the fiscal year ended March 31, 2015 were approximately 80% of all sales, compared to 79% for the prior fiscal year.

Menderes Akdag, President and CEO, commented: "We were able to increase sales for the quarter due to increased reorder sales, and decrease our operational expenses to improve our bottom line results. For the quarter ended March 31, 2015 our operating expenses decreased by about 300 basis points, which can be attributed to a reduction in advertising spending and the leveraging of our general and administrative expenses. Average order value was $81 for the quarter compared to $77 for the prior year's same quarter, which was due mainly to a change in product mix to higher priced items and increased doses. Cash flow from operations was $32.0 million for the fiscal year ended March 31, 2015, compared to $13.5 million for the year ended March 31, 2014, with a majority of the increase due to a reduction in inventory. For fiscal 2016 we are focusing on improving our marketing efforts to grow sales and profitability."

The Board of Directors declared an increased quarterly dividend of $0.18 per share on its common stock. The dividend will be payable on May 22, 2015, to shareholders of record at the close of business on May 15, 2015. 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 (888) 455-1758 (toll free) or (203) 827-7025. 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. on May 4, 2015 until May 18, 2015 at 11:59 P.M. To access the replay, call (800) 664-4216 (toll free) or (402) 220-0259 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 and cats 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, 2014. 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.
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
  March 31, March 31,
  2015 2014
     
ASSETS    
     
Current assets:    
Cash and cash equivalents  $ 35,613  $ 18,305
Short term investments - available for sale  15,591  15,539
Accounts receivable, less allowance for doubtful accounts of $8 and $7, respectively  1,931  1,761
Inventories - finished goods  25,068  35,727
Prepaid expenses and other current assets  1,380  1,761
Deferred tax assets  817  1,062
Prepaid income taxes  --   54
Total current assets  80,400  74,209
     
Noncurrent assets:    
Prepaid expenses  --   1,996
Property and equipment, net  1,569  1,310
Intangible asset  860  860
Deferred tax assets  23  -- 
Total noncurrent assets  2,452  4,166
     
Total assets  $ 82,852  $ 78,375
     
LIABILITIES AND SHAREHOLDERS' EQUITY    
     
Current liabilities:    
Accounts payable  $ 5,153  $ 5,768
Accrued expenses and other current liabilities  2,214  2,325
Income taxes payable  50  -- 
Total current liabilities  7,417  8,093
     
Deferred tax liabilities  --   65
     
Total liabilities  7,417  8,158
     
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; 20,262 and 20,190 shares issued and outstanding, respectively  20  20
Additional paid-in capital  3,117  1,578
Retained earnings  72,343  68,647
Accumulated other comprehensive loss  (54)  (37)
     
Total shareholders' equity  75,435  70,217
     
Total liabilities and shareholders' equity  $ 82,852  $ 78,375
 
 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, 
  2015 2014 2015 2014
   (UNAUDITED)     
Sales   $ 49,994  $ 48,632  $ 229,395  $ 233,391
Cost of sales   33,055  31,169  153,125  155,774
         
Gross profit   16,939  17,463  76,270  77,617
         
Operating expenses:         
General and administrative   4,899  4,868  21,101  21,352
Advertising   4,048  5,283  25,182  27,180
Discontinued project costs   --   --   1,714  -- 
Depreciation   173  170  660  867
Total operating expenses   9,120  10,321  48,657  49,399
         
Income from operations   7,819  7,142  27,613  28,218
         
Other income (expense):         
Interest income, net   46  44  184  185
Other, net   (2)  --   1  (4)
Total other income   44  44  185  181
         
Income before provision for income taxes   7,863  7,186  27,798  28,399
         
Provision for income taxes   2,912  2,660  10,345  10,427
         
Net income  $ 4,951  $ 4,526  $ 17,453  $ 17,972
         
Net change in unrealized gain (loss) on short and long term investments   (4)  1  (17)  (35)
         
Comprehensive income   $ 4,947  $ 4,527  $ 17,436  $ 17,937
         
Net income per common share:         
Basic   $ 0.25  $ 0.23  $ 0.87  $ 0.90
Diluted   $ 0.25  $ 0.23  $ 0.87  $ 0.90
         
Weighted average number of common shares outstanding:         
Basic   20,044  19,931  20,015  19,901
Diluted   20,146  20,046  20,136  20,043
         
Cash dividends declared per common share   $ 0.17  $ 0.17  $ 0.68  $ 0.66
 
PETMED EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
   Year Ended 
   March 31, 
  2015 2014
Cash flows from operating activities:     
Net income   $ 17,453  $ 17,972
Adjustments to reconcile net income to net cash provided by operating activities:     
Depreciation   660  867
Share based compensation   1,481  1,479
Discontinued project costs   1,714  -- 
Deferred income taxes   157  (183)
Bad debt expense   94  95
(Increase) decrease in operating assets and increase (decrease) in liabilities:     
Accounts receivable   (264)  (417)
Inventories - finished goods   10,659  (4,126)
Prepaid income taxes   54  (54)
Prepaid expenses and other current assets   662  (1,237)
Accounts payable   (616)  (686)
Accrued expenses and other current liabilities   (61)  (42)
Income taxes payable   50  (162)
Net cash provided by operating activities   32,043  13,506
     
Cash flows from investing activities:     
Net change in investments   (68)  (84)
Purchases of property and equipment   (918)  (45)
Net cash used in investing activities   (986)  (129)
     
Cash flows from financing activities:     
Dividends paid   (13,807)  (13,326)
Tax adjustment related to stock compensation   58  99
Net cash used in financing activities   (13,749)  (13,227)
     
Net increase in cash and cash equivalents   17,308  150
Cash and cash equivalents, at beginning of year   18,305  18,155
     
Cash and cash equivalents, at end of year   $ 35,613  $ 18,305
     
Supplemental disclosure of cash flow information:     
     
Cash paid for income taxes   $ 10,026  $ 10,727
     
Dividends payable in accrued expenses   $ 212  $ 262
CONTACT: For investment relations contact         PetMed Express, Inc.         Bruce S. Rosenbloom, CFO, 954-979-5995