On Nov. 15, PetSmart (NASDAQ:PETM) released third-quarter earnings for the period ended Oct. 29.

  • Revenues grew by 14%, driven by comparable store sales, which grew by 6.8%.
  • PetSmart opened 28 new stores and closed four locations during the third quarter; the company currently operates 885 stores.
  • The company purchased approximately 4.9 million of its shares at an average price of $24.96 during Q3. The company can purchase another $128 million worth of shares by August 2007.
  • EPS grew by 9.5%, helped by the decline in share count from repurchases.
  • PetSmart estimates earnings at approximately $0.54 to $0.56 per share in the fourth quarter and $1.31 to $1.33 per share for the full year.

(Figures in million, except per-share data)

Income Statement Highlights

Q3 2006

Q3 2005

Change

Sales

$1,034.8

$907.7

14%

Net Profit

$31.7

$31.1

1.9%

EPS

$0.23

$0.21

9.5%

Diluted Shares

138.7

144.8

(4.2%)



Get back to basics with a look at the income statement.

Margin Checkup

Q3 2006

Q3 2005

Change*

Gross Margin

29.9%

29%

0.9

Operating Margin

5.5%

5.6%

(0.1)

Net Margin

3.1%

3.4%

(0.4)

*Expressed in percentage points

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q3 2006

Q3 2005

Change

Cash + ST Invest.

$233.5

$298.9

(21.9%)

Accounts Rec.

$30.2

$28.6

5.6%

Inventory

$509.6

$458.2

11.2%



Q3 2006

Q3 2005

Change

Accounts Payable

$219.2

$218.8

0.2%

Long-Term Debt

$420.9

$335.5

25.5%



Learn the ways of the balance sheet.

Cash Flow Highlights

A statement of cash flows was not provided.

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