Petco Health and Wellness Co. delivered net revenue of $1.4 billion, up 15 percent versus prior year, in the third quarter of 2021, ended Oct. 30, company officials reported. Net income improved by $49.3 million from prior year to $52.8 million or $0.20 per share.
“Q3 marked our sixth consecutive quarter of double-digit growth with a 15 percent Q3 comp, lapping 17 percent a year ago, giving us confidence to raise guidance for full year 2021,” said Ron Coughlin, chairman and CEO of Petco. “Our focus on long-term, sustainable growth is powered by continued execution against our transformation, with one of the fastest veterinary expansions in history, further enhancement of our digital competitive advantages, expansion of our merchandise differentiation through powerful owned and exclusive brands, and our incredible Petco partners who are improving more and more pet lives every single day in a challenging environment.”
Trailing 12-month net income improved by $156.8 million from prior year to $129.3 million. Adjusted net income for the third quarter increased $40.4 million from prior year to $54.0 million or $0.20 per share, while Adjusted EBITDA increased by 17 percent from prior year to $138.5 million.
Additionally, through the first 39 weeks of 2021, total debt remained roughly flat at $1.7 billion with net debt improving $94.8 million to $1.5 billion driven by net cash flow from operations of $288.4 million and free cash flow of $124.1 million, up 43 percent and 18 percent, respectively, from the first 39 weeks of 2020. Also, in the first 39 weeks of 2021, net debt / trailing twelve month adjusted EBITDA decreased 19 percent or 0.6x to 2.6x driven by free cash flow generation and growth in Adjusted EBITDA.
Fiscal Q3 2021 Highlights:
Comparisons are third quarter of 2021 ended Oct. 30, 2021 versus third quarter of 2020 ended Oct. 31, 2020 unless otherwise noted
- Net revenue increased 15 percent to $1.4 billion driven by comp sales growth of 15 percent
- Net income increased $49.3 million to $52.8 million or $0.20 per share
- Adjusted net Income increased $40.4 million to $54.0 million or $0.20 per share
- Adjusted EBITDA increased 17 percent to $138.5 million
- Trailing 12 net income increased $156.8 million to $129.3 million
- Trailing 12 month adjusted EBITDA increased $100.3 million to $567.9 million
- Net cash provided by operating activities increased $87.0 million to $288.4 million in the first 39 weeks of 2021
- Free cash flow increased $18.9 million to $124.1 million in the first 39 weeks of 2021
- Total debt decreased $1.6 billion, or 48 percent, to $1.7 billion driven by the proceeds generated from the company’s initial public offering, related recapitalization, and free cash flow generation
- Net debt decreased $1.6 billion or 52 percent to $1.5 billion
- Net debt/ trailing 12 month Adjusted EBITDA improved 60 percent to 2.6x
- Liquidity of $662.6 million as of Oct. 30, 2021 inclusive of $221.5 million of cash and cash equivalents and $441.1 million of availability on revolving credit facility
- Ended the quarter with 1,449 Pet Care Centers in the U.S. and Puerto Rico, 172 full-service Vet Hospitals within Pet Care Centers, and 108 Pet Care Centers in Mexico
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