Attached files
file | filename |
---|---|
8-K - 8-K - PEP BOYS MANNY MOE & JACK | a15-18960_18k.htm |
EX-99.1 - EX-99.1 - PEP BOYS MANNY MOE & JACK | a15-18960_1ex99d1.htm |
Exhibit 99.2
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES |
(UNAUDITED) |
CONSOLIDATED BALANCE SHEETS
(dollar amounts in thousands)
|
|
August 1, 2015 |
|
January 31, 2015 |
|
August 2, 2014 |
| |||
Assets |
|
|
|
|
|
|
| |||
Current assets: |
|
|
|
|
|
|
| |||
Cash and cash equivalents |
|
$ |
62,408 |
|
$ |
38,044 |
|
$ |
38,423 |
|
Accounts receivable, less allowance for uncollectible accounts of $1,719, $1,604 and $2,102 |
|
29,762 |
|
31,013 |
|
27,908 |
| |||
Merchandise inventories |
|
636,692 |
|
656,957 |
|
659,547 |
| |||
Prepaid expenses |
|
20,831 |
|
27,952 |
|
21,314 |
| |||
Other current assets |
|
50,866 |
|
55,986 |
|
56,172 |
| |||
Assets held for disposal |
|
2,466 |
|
2,648 |
|
2,647 |
| |||
Total current assets |
|
803,025 |
|
812,600 |
|
806,011 |
| |||
Property and equipment, net of accumulated depreciation of $1,276,588, $1,251,797 and $1,254,126 |
|
587,805 |
|
604,380 |
|
623,285 |
| |||
Goodwill |
|
32,869 |
|
32,869 |
|
56,794 |
| |||
Deferred income taxes |
|
49,136 |
|
56,571 |
|
56,406 |
| |||
Other long-term assets |
|
34,345 |
|
35,321 |
|
38,236 |
| |||
Total assets |
|
$ |
1,507,180 |
|
$ |
1,541,741 |
|
$ |
1,580,732 |
|
|
|
|
|
|
|
|
| |||
Liabilities and stockholders equity |
|
|
|
|
|
|
| |||
Current liabilities: |
|
|
|
|
|
|
| |||
Accounts payable |
|
$ |
216,826 |
|
$ |
227,132 |
|
$ |
219,423 |
|
Trade payable program liability |
|
134,356 |
|
140,904 |
|
137,214 |
| |||
Accrued expenses |
|
210,689 |
|
226,176 |
|
224,399 |
| |||
Deferred income taxes |
|
65,542 |
|
61,216 |
|
70,785 |
| |||
Current maturities of long-term debt |
|
2,000 |
|
2,000 |
|
2,000 |
| |||
Total current liabilities |
|
629,413 |
|
657,428 |
|
653,821 |
| |||
|
|
|
|
|
|
|
| |||
Long-term debt less current maturities |
|
193,000 |
|
211,000 |
|
220,000 |
| |||
Other long-term liabilities |
|
43,154 |
|
45,567 |
|
46,899 |
| |||
Deferred gain from asset sales |
|
97,125 |
|
103,596 |
|
108,521 |
| |||
Commitments and contingencies |
|
|
|
|
|
|
| |||
Stockholders equity: |
|
|
|
|
|
|
| |||
Common stock, par value $1 per share: |
|
|
|
|
|
|
| |||
Authorized 500,000,000 shares; issued 68,557,046 shares |
|
68,557 |
|
68,557 |
|
68,557 |
| |||
Additional paid-in capital |
|
296,750 |
|
298,299 |
|
297,924 |
| |||
Retained earnings |
|
408,565 |
|
397,890 |
|
432,476 |
| |||
Accumulated other comprehensive income |
|
(294 |
) |
(391 |
) |
213 |
| |||
Treasury stock, at cost - 14,576,481 shares; 14,988,205 shares and 15,265,028 shares |
|
(229,090 |
) |
(240,205 |
) |
(247,679 |
) | |||
Total stockholders equity |
|
544,488 |
|
524,150 |
|
551,491 |
| |||
Total liabilities and stockholders equity |
|
$ |
1,507,180 |
|
$ |
1,541,741 |
|
$ |
1,580,732 |
|
|
|
|
|
|
|
|
| |||
Supplemental balance sheet information: |
|
|
|
|
|
|
| |||
Working capital |
|
$ |
173,612 |
|
$ |
155,172 |
|
$ |
152,190 |
|
Current ratio |
|
1.28 |
|
1.24 |
|
1.23 |
| |||
Accounts payable to inventory ratio |
|
55.2 |
% |
56.0 |
% |
54.1 |
% | |||
Total debt as a percent of total capitalization |
|
26.4 |
% |
28.9 |
% |
28.7 |
% | |||
Debt as a percent of total capitalization, net |
|
19.6 |
% |
25.0 |
% |
25.0 |
% |
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(dollar amounts in thousands, except per share amounts)
|
|
Thirteen weeks ended |
|
Twenty-six weeks ended |
| ||||||||||||||||
|
|
August 1, 2015 |
|
August 2, 2014 |
|
August 1, 2015 |
|
August 2, 2014 |
| ||||||||||||
|
|
|
|
% |
|
|
|
% |
|
|
|
% |
|
|
|
% |
| ||||
|
|
Amount |
|
Sales |
|
Amount |
|
Sales |
|
Amount |
|
Sales |
|
Amount |
|
Sales |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Merchandise sales |
|
$ |
401,880 |
|
76.3 |
|
$ |
400,931 |
|
76.3 |
|
$ |
815,005 |
|
76.3 |
|
$ |
812,837 |
|
76.4 |
|
Service revenue |
|
124,666 |
|
23.7 |
|
124,842 |
|
23.7 |
|
253,802 |
|
23.7 |
|
251,758 |
|
23.6 |
| ||||
Total revenues |
|
526,546 |
|
100.0 |
|
525,773 |
|
100.0 |
|
1,068,807 |
|
100.0 |
|
1,064,595 |
|
100.0 |
| ||||
Costs of merchandise sales |
|
279,707 |
|
69.6 |
|
280,100 |
|
69.9 |
|
565,950 |
|
69.4 |
|
565,147 |
|
69.5 |
| ||||
Costs of service revenue |
|
119,267 |
|
95.7 |
|
121,376 |
|
97.2 |
|
241,518 |
|
95.2 |
|
242,024 |
|
96.1 |
| ||||
Total costs of revenues |
|
398,974 |
|
75.8 |
|
401,476 |
|
76.4 |
|
807,468 |
|
75.5 |
|
807,171 |
|
75.8 |
| ||||
Gross profit from merchandise sales |
|
122,173 |
|
30.4 |
|
120,831 |
|
30.1 |
|
249,055 |
|
30.6 |
|
247,690 |
|
30.5 |
| ||||
Gross profit from service revenue |
|
5,399 |
|
4.3 |
|
3,466 |
|
2.8 |
|
12,284 |
|
4.8 |
|
9,734 |
|
3.9 |
| ||||
Total gross profit |
|
127,572 |
|
24.2 |
|
124,297 |
|
23.6 |
|
261,339 |
|
24.5 |
|
257,424 |
|
24.2 |
| ||||
Selling, general and administrative expenses |
|
117,272 |
|
22.3 |
|
120,624 |
|
22.9 |
|
238,118 |
|
22.3 |
|
247,694 |
|
23.3 |
| ||||
Net gain (loss) from dispositions of assets |
|
267 |
|
0.1 |
|
(400 |
) |
(0.1 |
) |
485 |
|
|
|
(410 |
) |
|
| ||||
Gain on sale from leasehold interest |
|
|
|
|
|
|
|
|
|
10,000 |
|
0.9 |
|
|
|
|
| ||||
Operating profit |
|
10,567 |
|
2.0 |
|
3,273 |
|
0.6 |
|
33,706 |
|
3.2 |
|
9,320 |
|
0.9 |
| ||||
Other income |
|
334 |
|
0.1 |
|
316 |
|
0.1 |
|
706 |
|
0.1 |
|
758 |
|
0.1 |
| ||||
Interest expense |
|
(3,262 |
) |
(0.6 |
) |
(3,002 |
) |
(0.6 |
) |
(6,591 |
) |
(0.6 |
) |
(6,784 |
) |
(0.6 |
) | ||||
Earnings from continuing operations before income taxes and discontinued operations |
|
7,639 |
|
1.5 |
|
587 |
|
0.1 |
|
27,821 |
|
2.6 |
|
3,294 |
|
0.3 |
| ||||
Income tax expense |
|
(2,903 |
) |
(38.0 |
)(1) |
(764 |
) |
(130.1 |
)(1) |
(11,225 |
) |
(40.3 |
)(1) |
(1,831 |
) |
(55.6 |
)(1) | ||||
Earnings (loss) from continuing operations before discontinued operations |
|
4,736 |
|
0.9 |
|
(177 |
) |
|
|
16,596 |
|
1.6 |
|
1,463 |
|
0.1 |
| ||||
Earnings (loss) from discontinued operations, net of tax |
|
74 |
|
|
|
(96 |
) |
|
|
108 |
|
|
|
(125 |
) |
|
| ||||
Net earnings (loss) |
|
4,810 |
|
0.9 |
|
(273 |
) |
(0.1 |
) |
16,704 |
|
1.6 |
|
1,338 |
|
0.1 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Basic earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Earnings from continuing operations before discontinued operations |
|
$ |
0.09 |
|
|
|
$ |
|
|
|
|
$ |
0.31 |
|
|
|
$ |
0.03 |
|
|
|
Discontinued operations, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Basic earnings per share |
|
$ |
0.09 |
|
|
|
$ |
|
|
|
|
$ |
0.31 |
|
|
|
$ |
0.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Diluted earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Earnings from continuing operations before discontinued operations |
|
$ |
0.09 |
|
|
|
$ |
|
|
|
|
$ |
0.31 |
|
|
|
$ |
0.03 |
|
|
|
Discontinued operations, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Diluted earnings per share |
|
$ |
0.09 |
|
|
|
$ |
|
|
|
|
$ |
0.31 |
|
|
|
$ |
0.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Other comprehensive (loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Derivative financial instruments adjustment, net of tax |
|
(49 |
) |
|
|
(128 |
) |
|
|
97 |
|
|
|
(166 |
) |
|
| ||||
Other comprehensive (loss) income |
|
(49 |
) |
|
|
(128 |
) |
|
|
97 |
|
|
|
(166 |
) |
|
| ||||
Comprehensive income (loss) |
|
$ |
4,761 |
|
|
|
$ |
(401 |
) |
|
|
$ |
16,801 |
|
|
|
$ |
1,172 |
|
|
|
(1) As a percentage of earnings from continuing operations before income taxes and discontinued operations.
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollar amounts in thousands)
Twenty-six weeks ended |
|
August 1, 2015 |
|
August 2, 2014 |
| ||
|
|
|
|
|
| ||
Cash flows from operating activities: |
|
|
|
|
| ||
Net earnings |
|
$ |
16,704 |
|
$ |
1,338 |
|
Adjustments to reconcile net earnings to net cash provided by continuing operations: |
|
|
|
|
| ||
Net (earnings) loss from discontinued operations |
|
(108 |
) |
125 |
| ||
Depreciation |
|
33,195 |
|
36,346 |
| ||
Amortization of deferred gain from asset sales |
|
(6,471 |
) |
(6,302 |
) | ||
Amortization of deferred financing costs |
|
1,252 |
|
1,311 |
| ||
Stock compensation expense |
|
2,267 |
|
1,799 |
| ||
Deferred income taxes |
|
10,261 |
|
2,727 |
| ||
Net (gain) loss from dispositions of assets |
|
(485 |
) |
410 |
| ||
Loss from asset impairment |
|
2,476 |
|
3,839 |
| ||
Other |
|
(554 |
) |
(79 |
) | ||
Changes in assets and liabilities, net of the effects of acquisitions: |
|
|
|
|
| ||
Decrease in accounts receivable, prepaid expenses and other |
|
14,675 |
|
12,572 |
| ||
Decrease in merchandise inventories |
|
20,265 |
|
12,807 |
| ||
Decrease in accounts payable |
|
(9,022 |
) |
(34,591 |
) | ||
Decrease in accrued expenses |
|
(15,147 |
) |
(15,167 |
) | ||
Decrease in other long-term liabilities |
|
(1,839 |
) |
(1,277 |
) | ||
Net cash provided by continuing operations |
|
67,469 |
|
15,858 |
| ||
Net cash used in discontinued operations |
|
(194 |
) |
(300 |
) | ||
Net cash provided by operating activities |
|
67,275 |
|
15,558 |
| ||
|
|
|
|
|
| ||
Cash flows from investing activities: |
|
|
|
|
| ||
Capital expenditures |
|
(22,102 |
) |
(39,010 |
) | ||
Proceeds from dispositions of assets |
|
2,066 |
|
35 |
| ||
Net cash used in investing activities |
|
(20,036 |
) |
(38,975 |
) | ||
|
|
|
|
|
| ||
Cash flows from financing activities: |
|
|
|
|
| ||
Borrowings under line of credit agreements |
|
112,193 |
|
339,179 |
| ||
Payments under line of credit agreements |
|
(129,193 |
) |
(317,679 |
) | ||
Borrowings on trade payable program liability |
|
80,890 |
|
94,353 |
| ||
Payments on trade payable program liability |
|
(87,438 |
) |
(86,940 |
) | ||
Debt payments |
|
(1,000 |
) |
(1,000 |
) | ||
Proceeds from stock issuance |
|
1,673 |
|
496 |
| ||
Net cash (used in) provided by financing activities |
|
(22,875 |
) |
28,409 |
| ||
Net increase in cash and cash equivalents |
|
24,364 |
|
4,992 |
| ||
Cash and cash equivalents at beginning of period |
|
38,044 |
|
33,431 |
| ||
Cash and cash equivalents at end of period |
|
$ |
62,408 |
|
$ |
38,423 |
|
|
|
|
|
|
| ||
Supplemental cash flow information: |
|
|
|
|
| ||
Cash paid for income taxes |
|
$ |
940 |
|
$ |
660 |
|
Cash received from income tax refunds |
|
$ |
|
|
$ |
244 |
|
Cash paid for interest |
|
$ |
5,257 |
|
$ |
5,584 |
|
Accrued purchases of property and equipment |
|
$ |
2,110 |
|
$ |
3,537 |
|
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
COMPUTATION OF BASIC AND DILUTED EARNINGS PER SHARE |
(in thousands, except per share data) |
|
|
|
|
|
|
Thirteen weeks ended |
|
Twenty-six weeks ended |
| ||||||||
|
|
|
|
|
|
August 1, 2015 |
|
August 2, 2014 |
|
August 1, 2015 |
|
August 2, 2014 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
(a) |
|
Earnings (loss) from continuing operations before discontinued operations |
|
|
|
$ |
4,736 |
|
$ |
(177 |
) |
$ |
16,596 |
|
$ |
1,463 |
|
|
|
Earnings (loss) from discontinued operations, net of tax |
|
|
|
74 |
|
(96 |
) |
108 |
|
(125 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Net earnings (loss) |
|
|
|
$ |
4,810 |
|
$ |
(273 |
) |
$ |
16,704 |
|
$ |
1,338 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
(b) |
|
Basic average number of common shares outstanding during period |
|
|
|
54,239 |
|
53,528 |
|
54,167 |
|
53,499 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Common shares assumed issued upon exercise of dilutive stock options, net of assumed repurchase, at the average market price |
|
|
|
192 |
|
|
|
141 |
|
526 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
(c) |
|
Diluted average number of common shares assumed outstanding during period |
|
|
|
54,431 |
|
53,528 |
|
54,308 |
|
54,025 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Basic earnings per share: |
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Earnings from continuing operations before discontinued operations |
|
(a) / (b) |
|
$ |
0.09 |
|
$ |
|
|
$ |
0.31 |
|
$ |
0.03 |
|
|
|
Discontinued operations, net of tax |
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Basic earnings per share |
|
|
|
$ |
0.09 |
|
$ |
|
|
$ |
0.31 |
|
$ |
0.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Diluted earnings per share: |
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Earnings from continuing operations before discontinued operations |
|
(a) / (c) |
|
$ |
0.09 |
|
$ |
|
|
$ |
0.31 |
|
$ |
0.03 |
|
|
|
Discontinued operations, net of tax |
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
Diluted earnings per share |
|
|
|
$ |
0.09 |
|
$ |
|
|
$ |
0.31 |
|
$ |
0.03 |
|
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES |
|
ADDITIONAL INFORMATION |
(dollar amounts in thousands) |
|
|
Thirteen weeks ended |
|
Twenty-six weeks ended |
| ||||||||
|
|
August 1, 2015 |
|
August 2, 2014 |
|
August 1, 2015 |
|
August 2, 2014 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Capital expenditures |
|
$ |
9,835 |
|
$ |
24,445 |
|
$ |
22,102 |
|
$ |
39,010 |
|
Depreciation |
|
$ |
16,301 |
|
$ |
18,026 |
|
$ |
33,195 |
|
$ |
36,346 |
|
Non-operating income: |
|
|
|
|
|
|
|
|
| ||||
Net rental revenue |
|
$ |
277 |
|
$ |
284 |
|
$ |
581 |
|
$ |
683 |
|
Investment income |
|
52 |
|
46 |
|
112 |
|
93 |
| ||||
Other income |
|
5 |
|
(14 |
) |
13 |
|
(18 |
) | ||||
Total |
|
$ |
334 |
|
$ |
316 |
|
$ |
706 |
|
$ |
758 |
|
|
|
|
|
|
|
|
|
|
| ||||
Comparable sales percentages: |
|
|
|
|
|
|
|
|
| ||||
Service |
|
-0.4 |
% |
5.4 |
% |
0.5 |
% |
4.3 |
% | ||||
Merchandise |
|
0.5 |
% |
-3.8 |
% |
0.6 |
% |
-3.3 |
% | ||||
Total |
|
0.3 |
% |
-1.8 |
% |
0.6 |
% |
-1.6 |
% | ||||
|
|
|
|
|
|
|
|
|
| ||||
Total square feet of retail space (including service centers) |
|
|
|
|
|
12,885,000 |
|
12,807,000 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Store count |
|
|
|
|
|
|
|
|
| ||||
Supercenter |
|
|
|
|
|
562 |
|
565 |
| ||||
Service & Tire Center |
|
|
|
|
|
234 |
|
228 |
| ||||
Retail Only |
|
|
|
|
|
5 |
|
6 |
| ||||
Total |
|
|
|
|
|
801 |
|
799 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Sales and gross profit by line of business (A): |
|
|
|
|
|
|
|
|
| ||||
Service center revenue |
|
$ |
290,806 |
|
$ |
288,302 |
|
$ |
591,689 |
|
582,215 |
| |
Retail sales |
|
235,740 |
|
237,471 |
|
477,118 |
|
482,380 |
| ||||
Total revenues |
|
$ |
526,546 |
|
$ |
525,773 |
|
$ |
1,068,807 |
|
$ |
1,064,595 |
|
|
|
|
|
|
|
|
|
|
| ||||
Gross profit from service center revenue, prior to impairment charge |
|
$ |
64,316 |
|
$ |
62,063 |
|
$ |
131,966 |
|
126,798 |
| |
Service center revenue impairment charge |
|
(605 |
) |
(1,379 |
) |
(1,356 |
) |
(2,335 |
) | ||||
Gross profit from service center revenue |
|
$ |
63,711 |
|
$ |
60,684 |
|
$ |
130,610 |
|
$ |
124,463 |
|
|
|
|
|
|
|
|
|
|
| ||||
Gross profit from retail sales, prior to impairment charge |
|
$ |
64,934 |
|
$ |
64,901 |
|
$ |
131,847 |
|
134,464 |
| |
Retail sales impairment charge |
|
(1,073 |
) |
(1,288 |
) |
(1,118 |
) |
(1,503 |
) | ||||
Gross profit from retail sales |
|
$ |
63,861 |
|
$ |
63,613 |
|
$ |
130,729 |
|
$ |
132,961 |
|
|
|
|
|
|
|
|
|
|
| ||||
Total gross profit |
|
$ |
127,572 |
|
$ |
124,297 |
|
$ |
261,339 |
|
$ |
257,424 |
|
|
|
|
|
|
|
|
|
|
| ||||
Comparable sales percentages by line of business (A): |
|
|
|
|
|
|
|
|
| ||||
Service center revenue |
|
0.6 |
% |
-0.2 |
% |
1.2 |
% |
-0.6 |
% | ||||
Retail sales |
|
0.0 |
% |
-3.6 |
% |
-0.2 |
% |
-2.7 |
% | ||||
Total revenues |
|
0.3 |
% |
-1.8 |
% |
0.6 |
% |
-1.6 |
% | ||||
|
|
|
|
|
|
|
|
|
| ||||
Gross profit percentage by line of business (A): |
|
|
|
|
|
|
|
|
| ||||
Gross profit percentage from service center revenue, prior to impairment charge |
|
22.1 |
% |
21.5 |
% |
22.3 |
% |
21.8 |
% | ||||
Impairment charge |
|
(0.2 |
) |
(0.5 |
) |
(0.2 |
) |
(0.4 |
) | ||||
Gross profit percentage from service center revenue |
|
21.9 |
% |
21.0 |
% |
22.1 |
% |
21.4 |
% | ||||
|
|
|
|
|
|
|
|
|
| ||||
Gross profit percentage from retail sales, prior to impairment charge |
|
27.5 |
% |
27.3 |
% |
27.6 |
% |
27.9 |
% | ||||
Impairment charge |
|
(0.5 |
) |
(0.5 |
) |
(0.2 |
) |
(0.3 |
) | ||||
Gross profit percentage from retail sales |
|
27.1 |
% |
26.8 |
% |
27.4 |
% |
27.6 |
% | ||||
|
|
|
|
|
|
|
|
|
| ||||
Total gross profit percentage |
|
24.2 |
% |
23.6 |
% |
24.5 |
% |
24.2 |
% |
(A) Retail sales include DIY and commercial sales. Service center revenue includes revenue from labor and installed parts and tires.