PetSmart Profits, Expands

For the quarter ended Jan. 29, the company reported net income of $70.9 million, or 50 cents per diluted share, compared with net income of $65 million, or 43 cents per diluted share, for the fourth quarter of fiscal 2004. The fourth quarter of 2005 included benefits from a credit card rate settlement and other one-time events that helped earnings.

For all of fiscal 2005, the company reported net income of $182.5 million, or $1.25 per diluted share. That compares with fiscal 2004 net income of $157.5 million, or $1.05 per diluted share.

Sales for the fourth quarter rose to $1.05 billion, compared to $934.3 million for the same period in 2004, and comparable store sales grew 4.5% on top of 4.6% in the fourth quarter of 2004. For the year, the company reported sales of $3.76 billion, up from $3.36 billion a year ago. Comparable store sales grew 4.2% in 2005, versus 6.3% in 2004.

PetSmart plans to open an average of about 100 new stores per year in the coming years, along with new openings of its PetHotels, which are targeted at 30 new openings this year. In 2005, the company opened 107 new stores and closed seven locations, compared with 92 new stores and nine closings in 2004.

Francis noted in the conference call that PetSmart "weathered a tough period in mid-year when consumers were shaken by hurricanes and high fuel prices." Nonetheless, the company emerged with its fundamental business still strong, "our strategic initiatives intact and our prospects for the future bright," he said. After the disruption of the hurricanes, he said, "Our overall traffic has returned to a more normal pattern."

PetSmart operates more than 825 pet stores in the United States and Canada, along with a growing number of in-store PetsHotels.