EX-99 4 exh9902.txt Exhibit 99.2 Unaudited Supplemental Financial Information
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (dollar amounts in thousands, except per share amounts) UNAUDITED Aug. 2, 2003 Feb. 1, 2003* Aug. 3, 2002 ------------------------------------------------------------------------------------------------------------------------- (Unaudited) ASSETS Current Assets: Cash and cash equivalents $ 68,095 $ 42,770 $ 86,865 Accounts receivable, net 24,405 17,916 20,125 Merchandise inventories 506,510 488,882 522,355 Prepaid expenses 29,430 43,746 27,581 Deferred income taxes 32,623 13,723 14,917 Other 51,505 56,687 41,571 Assets held for disposal 21,900 1,146 5,972 ------------------------------------------------------------------------------------------------------------------------ Total Current Assets 734,468 664,870 719,386 ------------------------------------------------------------------------------------------------------------------------ Property and Equipment-at cost: Land 264,121 279,109 278,236 Buildings and improvements 892,927 936,770 927,350 Furniture, fixtures and equipment 592,213 604,531 590,068 Construction in progress 26,886 19,450 12,820 ------------------------------------------------------------------------------------------------------------------------ 1,776,147 1,839,860 1,808,474 Less accumulated depreciation and amortization 761,687 751,823 715,027 ------------------------------------------------------------------------------------------------------------------------ Property and Equipment - Net 1,014,460 1,088,037 1,093,447 ------------------------------------------------------------------------------------------------------------------------ Other 56,913 47,003 40,526 ------------------------------------------------------------------------------------------------------------------------ Total Assets $1,805,841 $1,799,910 $1,853,359 ------------------------------------------------------------------------------------------------------------------------ LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $ 319,223 $ 200,053 $ 219,892 Accrued expenses 267,356 232,255 240,490 Current maturities of long-term debt and obligations under capital leases 72,362 101,882 148,400 ------------------------------------------------------------------------------------------------------------------------ Total Current Liabilities 658,941 534,190 608,782 ------------------------------------------------------------------------------------------------------------------------ Long-term debt and obligations under capital leases, less current maturities 314,711 375,577 385,318 Convertible long-term debt, less current maturities 150,000 150,000 150,000 Other long-term liabilities 28,924 25,156 - Deferred income taxes 42,894 60,663 62,747 Deferred gain on sale leaseback 4,324 4,332 4,399 Commitments and Contingencies Stockholders' Equity: Common Stock, par value $1 per share: Authorized 500,000,000 shares; Issued 63,910,577 shares 63,911 63,911 63,911 Additional paid-in capital 177,244 177,244 177,244 Retained earnings 571,403 630,847 624,894 Accumulated other comprehensive loss 3,749 (151) - ------------------------------------------------------------------------------------------------------------------------ 816,307 871,851 866,049 Less cost of shares in treasury - 9,352,311 shares 10,070,729 shares and 10,199,363 shares 150,996 162,595 164,672 Less cost of shares in benefits trust - 2,195,270 shares 59,264 59,264 59,264 ------------------------------------------------------------------------------------------------------------------------ Total Stockholders' Equity 606,047 649,992 642,113 ------------------------------------------------------------------------------------------------------------------------ Total Liabilities and Stockholders' Equity $1,805,841 $1,799,910 $1,853,359 ------------------------------------------------------------------------------------------------------------------------ * Taken from the audited financial statements at February 1, 2003.
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (dollar amounts in thousands, except per share amounts) UNAUDITED Thirteen weeks ended Twenty-six weeks Ended ---------------------------------------- ----------------------------------------- Aug. 2, 2003 Aug. 3, 2002 Aug. 2, 2003 Aug. 3, 2002 ------------------ ------------------ ------------------- ------------------ Amount % Sales Amount % Sales Amount % Sales Amount % Sales --------------------------------------------------------------------------------------------------------------------------------- Merchandise Sales $ 451,285 81.2 $ 461,886 81.7 $ 862,417 80.8 $ 900,343 81.5 Service Revenue 104,745 18.8 103,745 18.3 204,523 19.2 204,943 18.5 --------------------------------------------------------------------------------------------------------------------------------- Total Revenues 556,030 100.0 565,631 100.0 1,066,940 100.0 1,105,286 100.0 --------------------------------------------------------------------------------------------------------------------------------- Costs of Merchandise Sales 344,903 76.4 320,485 69.4 635,243 73.7 628,123 69.8 Costs of Service Revenue 80,881 77.2 78,572 75.7 155,653 76.1 153,492 74.9 --------------------------------------------------------------------------------------------------------------------------------- Total Costs of Revenues 425,784 76.6 399,057 70.6 790,896 74.1 781,615 70.7 --------------------------------------------------------------------------------------------------------------------------------- Gross Profit from Merchandise Sales 106,382 23.6 141,401 30.6 227,174 26.3 272,220 30.2 Gross Profit from Service Revenue 23,864 22.8 25,173 24.3 48,870 23.9 51,451 25.1 --------------------------------------------------------------------------------------------------------------------------------- Total Gross Profit 130,246 23.4 166,574 29.4 276,044 25.9 323,671 29.3 --------------------------------------------------------------------------------------------------------------------------------- Selling, General and Administrative Expenses 143,049 25.7 129,048 22.8 290,826 27.3 254,738 23.0 --------------------------------------------------------------------------------------------------------------------------------- Operating (Loss) Profit (12,803) (2.3) 37,526 6.6 (14,782) (1.4) 68,933 6.3 Non-operating Income 851 0.1 997 0.2 1,901 0.2 1,820 0.1 Interest Expense 9,603 1.7 12,624 2.2 20,304 1.9 24,405 2.2 --------------------------------------------------------------------------------------------------------------------------------- (Loss) Income from Continuing Operations Before Income Taxes and Cumulative Effect of Change in Accounting Principle (21,555) (3.9) 25,899 4.6 (33,185) (3.1) 46,348 4.2 Income Tax (Benefit) Expense (7,976) 37.0 9,789 37.8 (12,279) 37.0 17,149 37.0 --------------------------------------------------------------------------------------------------------------------------------- Net (Loss) Income form Continuing Operations and Cumulative Effect of Change in Accounting Principle (13,579) (2.4) 16,110 2.8 (20,906) (2.0) 29,199 2.6 Discontinued Operations, Net of Tax (22,802) (4.1) 444 0.1 (22,208) (2.1) 920 0.1 Cumulative Effect of Change in Accounting Principle, Net of Tax - 0.0 - 0.0 (2,484) (0.2) - 0.0 Net (Loss) Earnings (36,381) (6.5) 16,554 2.9 (45,598) (4.3) 30,119 2.7 --------------------------------------------------------------------------------------------------------------------------------- Retained Earnings, beginning of period 617,798 611,871 630,847 601,944 Cash Dividends 3,491 3,475 6,978 6,948 Effect of Stock Options 6,477 (16) 6,548 149 Dividend Reinvestment Plan 46 72 320 72 --------------------------------------------------------------------------------------------------------------------------------- Retained Earnings, end of period $ 571,403 $ 624,894 $ 571,403 $ 624,894 --------------------------------------------------------------------------------------------------------------------------------- Basic (Loss) Earnings Per Share: (Loss) From Continuing Operations Before Cumulative Effect of Change in Accounting Principle $ (0.26) $ 0.31 $ (0.40) $ 0.57 Discontinued Operations,net of tax (0.44) 0.01 (0.43) 0.02 Cumulative Effect of Change in Accounting Principle, net of tax - - (0.05) - --------------------------------------------------------------------------------------------------------------------------------- Basic (Loss) Earnings Per Share $ (0.70) $ 0.32 $ (0.88) $ 0.59 --------------------------------------------------------------------------------------------------------------------------------- Diluted (Loss) Earnings Per Share: (Loss) From Continuing Operations Before Cumulative Effect of Change in Accounting Principle $ (0.26) $ 0.29 $ (0.40) $ 0.54 Discontinued Operations, net of tax (0.44) 0.01 (0.43) 0.02 Cumulative Effect of Change in Accounting Principle, net of tax - - (0.05) - --------------------------------------------------------------------------------------------------------------------------------- Diluted (Loss) Earnings Per Share $ (0.70) $ 0.30 $ (0.88) $ 0.56 --------------------------------------------------------------------------------------------------------------------------------- Cash Dividends Per Share $ .0675 $ .00675 $ .1350 $ .1350 ---------------------------------------------------------------------------------------------------------------------------------
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (dollar amounts in thousands) UNAUDITED Twenty-six Weeks Ended Aug. 2, 2003 Aug, 3, 2002 ---------------------------------------------------------------------------------------------------------------- Cash Flows from Operating Activities: Net (Loss) Earnings $ (45,598) $ 30,119 (Loss) income from discontinued operations (22,208) 920 ---------------------------------------------------------------------------------------------------------------- (Loss) income from continuing operations (23,390) 29,199 Adjustments to Reconcile Net Earnings to Net Cash Net Cash Provided by Operating Activities: Depreciation and amortization 35,271 38,706 Cumulative effect of change in accounting principle 2,484 - Accretion of asset disposal obligation 90 - Deferred income taxes (38,959) (377) Deferred gain on sale lease back (8) (45) Loss on asset impairment 2,121 - Loss on assets held for disposal - 1,360 Loss from sale of assets 34 179 Changes in Operating Assets and Liabilities: Decrease in accounts receivable, prepaid expenses and other 9,289 22,518 Increase in merchandise inventories (17,628) (2,882) Increase in accounts payable 119,170 3,807 Increase (decrease) in accrued expenses 40,593 (1,764) Increase in other long-term liabilities 3,768 440 ---------------------------------------------------------------------------------------------------------------- Net Cash Provided by Continuing Operations 132,835 91,141 Net Cash Provided by Discontinued Operations 4,591 3,290 ---------------------------------------------------------------------------------------------------------------- Net Cash Provided by Operating Activities 137,426 94,431 ---------------------------------------------------------------------------------------------------------------- Cash Flows from Investing Activities: Capital expenditures (21,420) (11,951) Proceeds from sales of assets 1,952 5,252 ---------------------------------------------------------------------------------------------------------------- Net Cash Used in Investing Activities (19,468) (6,699) ---------------------------------------------------------------------------------------------------------------- Cash Flows from Financing Activities: Net borrowings (payments) under line of credit agreements 1,441 (70,539) Repayment of life insurance policy loan - (20,686) Capital lease obligations (400) (308) Reduction of long-term debt (91,427) (65,769) Net proceeds from iussuance of notes - 146,250 Dividends paid (6,978) (6,948) Proceeds from exercise of stock options 4,085 475 Proceeds from dividend reinvestment plan 646 677 ---------------------------------------------------------------------------------------------------------------- Net Cash Used in Financing Activities (92,633) (16,848) ---------------------------------------------------------------------------------------------------------------- Net Increase in Cash 25,325 70,884 ---------------------------------------------------------------------------------------------------------------- Cash and Cash Equivalents at Beginning of Period 42,770 15,981 ---------------------------------------------------------------------------------------------------------------- Cash and Cash Equivalents at End of Period $ 68,095 $ 86,865 ---------------------------------------------------------------------------------------------------------------- Non-cash financing activities: Equipment Capital Leases $ - $ 1,301 ----------------------------------------------------------------------------------------------------------------
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES COMPUTATION OF BASIC AND DILUTED EARNINGS PER SHARE (in thousands, except per share data) UNAUDITED Thirteen weeks ended Twenty-six weeks ended ----------------------------------- ---------------------------------- Aug. 2, 2003 Aug. 3, 2002 Aug. 2, 2003 Aug. 3, 2002 -------------- --------------- -------------- ------------ (a) (Loss) income from continuing operations before cumulative effect of change in accounting principle $ (13,579) $ 16,110 $ (20,906) $ 29,199 Adjustment for interest on convertible senior notes, net of income tax effect - 826 - 826 --------------------------------------------------------------------------------------------------------------------------------- (b) Adjusted net (loss) income from continuing operations before cumulative effect of change in accounting principle $ (13,579) $ 16,936 $ (20,906) $ 30,025 --------------------------------------------------------------------------------------------------------------------------------- (c) Average number of common shares outstanding during period 51,816 51,489 51,733 51,467 Common shares assumed issued upon conversion of convertible senior notes - 5,520 - 2,760 Common shares assumed issued upon exercise of dilutive stock options, net of assumed repurchase, at the average market price - 1,059 - 1,111 --------------------------------------------------------------------------------------------------------------------------------- (d) Average number of common shares assumed outstanding during period 51,816 58,068 51,733 55,338 --------------------------------------------------------------------------------------------------------------------------------- Basic (Loss) Earnings per share: (Loss) Income From Continuing operations Before Cumulative Effect of Change in Accounting Principle (a/c) $ (0.26) $ 0.31 $ (0.40) $ 0.57 Discontinued Operations, Net of Tax (0.44) 0.01 (0.43) 0.02 Cumulative Effect of Change in Accounting Principle, Net of Tax - - (0.05) - --------------------------------------------------------------------------------------------------------------------------------- Basic (loss) Earnings Per Share $ (0.70) $ 0.32 $ (0.88) $ 0.59 --------------------------------------------------------------------------------------------------------------------------------- Diluted (loss) earnings per share: (Loss) income from continuing operations before cumulative effect of change in accounting principle (b/d) $ (0.26) $ 0.29 $ (0.40) $ 0.54 Discontinued Operations, Net of Tax (0.44) 0.01 (0.43) 0.02 Cumulative Effect of Change in Accounting Principle, Net of Tax - - (0.05) - --------------------------------------------------------------------------------------------------------------------------------- Diluted (loss) earnings per share $ (0.70) $ 0.30 $ (0.88) $ 0.56 ---------------------------------------------------------------------------------------------------------------------------------
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES ADDITIONAL INFORMATION (dollar amounts in thousands) UNAUDITED Thirteen weeks ended Twenty-six weeks ended ------------------------------------ ------------------------------------ Aug, 2, 2003 Aug. 3, 2002 Aug. 2, 2003 Aug 3, 2002 --------------- --------------- --------------- --------------- Capital expenditures $ 12,855 $ 7,245 $ 21,420 $ 11,951 Depreciation and amortization $ 18,305 $ 20,152 $ 37,021 $ 40,535 Non-operating income: Net rental revenue $ 678 $ 621 $ 1,550 $ 1,310 Investment income 125 359 263 495 Other income (expense) 48 17 88 15 -------------- -------------- --------------- --------------- Total $ 851 $ 997 $ 1,901 $ 1,820 ============== ============== =============== =============== Comparable store sales percentages: Merchandise (2.1)% 2.9% (4.2)% 2.7% Service 0.8 (1.6) (0.4) (2.4) Total (1.6) 2.0 (3.5) 1.7 Total square feet of retail space (including service centers) 12,217,210 12,858,368 Charges relating to Corporate Restructuring are included in: Costs of merchandise sales $ 26,605 $ 390 $ 27,111 $ 1,570 Costs of service revenue 625 119 823 68 Selling, general & administrative expenses 5,974 3 6,134 13 -------------- -------------- --------------- --------------- Total pretax charges 33,204 512 34,068 1,651 Income tax expense (12,285) (201) (12,605) (611) -------------- -------------- --------------- --------------- Subtotal charges, net of tax $ 20,919 $ 311 $ 21,463 $ 1,040 Discontinued operations, net of tax 23,129 - 23,129 - -------------- -------------- --------------- --------------- Total charges, net of tax $ 44,048 $ 311 $ 44,592 $ 1,040 ============== ============== =============== =============== Charges relating to other charges are included in: Costs of merchandise sales $ 2,947 $ - $ 2,947 $ - Costs of service revenue 2,455 - 2,455 - Selling, general & administrative expenses 9,175 - 34,307 - -------------- -------------- --------------- --------------- Total pretax charges 14,577 - 39,709 - Income tax expense 5,393 - 14,692 - -------------- -------------- --------------- --------------- Subtotal charges, net of tax $ 9,184 $ - $ 25,017 $ - Cumulative effect of change in accounting principle, net of tax - - 2,484 - -------------- -------------- --------------- --------------- Total charges, net of tax $ 9,184 $ - $ 27,501 $ - ============== ============== =============== ===============