PetSmart profit falls, stock up on forecast
PetSmart Inc reported a quarterly profit that fell by less than analysts had expected, while the largest U.S. specialty pet retailer said it would slow growth of its stores and PetsHotels in a tough economy.
By Agencies |
LOS ANGELES: PetSmart Inc reported a quarterly profit that fell by less than analysts had expected, while the largest U.S. specialty pet retailer said it would slow growth of its stores and PetsHotels in a tough economy.
Shares of the company rose 2.4 percent after it also issued on Thursday a full-year forecast that topped analysts' average estimate. Net income for the fiscal second quarter ended August 3 fell to $37.2 million, or 30 cents per share, from $47.1 million, or 35 cents, in the year-earlier quarter when it booked $6.7 million in benefits from reductions in insurance and stock-option expenses and other items.
PetSmart's profit came in 2 cents higher than analysts' average call, according to Reuters Estimates. Net sales rose 11.2 percent to $1.2 billion, helped by pet services sales that grew 20.4 percent to $141.1 million. Sales at stores open at least one year, a standard gauge of retail health, increased 4 percent during the quarter.
The company which also offers pet boarding, grooming and training services said a higher cost of sales eroded gross profit margin, which fell to 29.5 percent from 31.0 percent a year ago. "We expect current macro trends to continue throughout the year," Chip Molloy, PetSmart's chief financial officer, said in a statement.
PetSmart executives said traffic weakness continued in the quarter and shoppers pulled back on toy and apparel purchases. For the current third quarter, the company forecast same-store sales growth in the mid-single digits and earnings in the range of 25 cents to 29 cents per share in line with analysts' call for earnings of 27 cents per share.
For the full year, the company forecast same-store sales growth in the mid-single digits and earnings of $1.51 to $1.59 per share. Analysts, on average, were looking for earnings of $1.50 per share. The estimates from 17 analysts ranged from $1.40 to $1.57 per share. Shares in PetSmart closed at $24.42 on the Nasdaq and rose to $25 in extended trade.
Shares of the company rose 2.4 percent after it also issued on Thursday a full-year forecast that topped analysts' average estimate. Net income for the fiscal second quarter ended August 3 fell to $37.2 million, or 30 cents per share, from $47.1 million, or 35 cents, in the year-earlier quarter when it booked $6.7 million in benefits from reductions in insurance and stock-option expenses and other items.
PetSmart's profit came in 2 cents higher than analysts' average call, according to Reuters Estimates. Net sales rose 11.2 percent to $1.2 billion, helped by pet services sales that grew 20.4 percent to $141.1 million. Sales at stores open at least one year, a standard gauge of retail health, increased 4 percent during the quarter.
The company which also offers pet boarding, grooming and training services said a higher cost of sales eroded gross profit margin, which fell to 29.5 percent from 31.0 percent a year ago. "We expect current macro trends to continue throughout the year," Chip Molloy, PetSmart's chief financial officer, said in a statement.
PetSmart executives said traffic weakness continued in the quarter and shoppers pulled back on toy and apparel purchases. For the current third quarter, the company forecast same-store sales growth in the mid-single digits and earnings in the range of 25 cents to 29 cents per share in line with analysts' call for earnings of 27 cents per share.
For the full year, the company forecast same-store sales growth in the mid-single digits and earnings of $1.51 to $1.59 per share. Analysts, on average, were looking for earnings of $1.50 per share. The estimates from 17 analysts ranged from $1.40 to $1.57 per share. Shares in PetSmart closed at $24.42 on the Nasdaq and rose to $25 in extended trade.
Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
