8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report: April 13, 2015

Date of Earliest Event Reported: April 13, 2015

The Pep Boys - Manny, Moe & Jack

(Exact name of registrant as specified in charter)

Pennsylvania	1-3381	23-0962915
(State or other jurisdiction of	(Commission	(I.R.S. Employer ID number)
incorporation or organization)	File No.)

3111 W. Allegheny Ave. Philadelphia, PA	19132
(Address of principal executive offices)	(Zip code)

215-430-9000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o    Written communications pursuant to Rule 425 under the Securities Act  (17 CFR 230.425)

o    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02  Results of Operations and Financial Condition

On April 13, 2015, The Pep Boys — Manny, Moe & Jack issued a press release announcing its earnings for the fiscal quarter ended January 31, 2015.

The information in Items 2.02 and 9.01 (including the Exhibits filed herewith) of this Current Report is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in Items 2.02 and 9.01 (including the Exhibits filed herewith) of this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.

Item 9.01  Financial Statements and Exhibits

(d) Exhibits. The following exhibits are filed with this report:

Exhibit No. 99.1   Press release dated April 13, 2015.

Exhibit No. 99.2   Unaudited supplemental financial data.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	THE PEP BOYS - MANNY, MOE & JACK
	By:	/s/ DAVID R. STERN
		David R. Stern
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)
Date: April 13, 2015

3

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Pep Boys Reports Fourth Quarter 2014 Results

- Positive Comp Sales Trend Continues -

- Strong Start to Fiscal 2015 -

PHILADELPHIA — April 13, 2015 — The Pep Boys — Manny, Moe & Jack (NYSE: “PBY”), the nation’s leading automotive aftermarket service and retail chain, announced the following results for the thirteen (fourth quarter) and fifty-two (fiscal year) weeks ended January 31, 2015.

Fourth Quarter

Sales

Sales for the thirteen weeks ended January 31, 2015 increased by $6.7 million, or 1.3%, to $502.4 million from $495.7 million for the thirteen weeks ended February 1, 2014. Comparable sales increased 1.3%, consisting of a 5.1% comparable service revenue increase and a 0.2% comparable merchandise sales increase. In accordance with GAAP, service revenue is limited to labor sales, while merchandise sales include merchandise sold through both our service center and retail lines of business. Re-categorizing sales into the respective lines of business from which they are generated, comparable service center revenue increased 3.2%, while comparable retail sales decreased 1.0%.

Earnings

Net loss for the fourth quarter of fiscal 2014 was $26.7 million ($0.50 per share) as compared to a net loss of $3.3 million ($0.06 per share) for the fourth quarter of fiscal 2013. On a pre-tax basis, the 2014 results included, a net charge of $12.4 million comprised of a $23.9 million goodwill impairment charge, a $2.3 million asset impairment charge and $0.5 million in severance, partially offset by a $14.3 million gain from the disposition of certain properties. The 2013 results included a $2.8 million asset impairment charge and $0.4 million of debt refinancing expense.

Fiscal Year

Sales

Sales for fiscal year 2014 increased by $18.0 million, or 0.9%, to $2,084.6 million from $2,066.6 million for fiscal year 2013. Comparable sales remained relatively flat, consisting of a 4.9% comparable service revenue increase and a 1.6% comparable merchandise sales decrease. Re-categorizing sales (see above), comparable service center revenue increased 1.4%, while comparable retail sales decreased 1.9%.

Earnings

Net loss for fiscal year 2014 was $27.3 million ($0.51 per share) as compared to earnings of $6.9 million ($0.13 per share) for fiscal year 2013. On a pre-tax basis, the 2014 results included, a net charge of $24.6 million comprised of a $23.9 million goodwill impairment charge, a $7.5 million asset impairment charge, $4.0 million in litigation expense and $2.9 million in severance, partially offset by a $13.8 million gain from the disposition of certain properties. The fiscal year 2013 results included, on a pre-tax basis, a net charge of $8.7 million comprised of a $7.7 million asset impairment charge, $0.6 million in severance and $0.4 million of debt refinancing expense.

Commentary

“The fourth quarter was a time of transition for the Company,” said interim CEO John Sweetwood.  “We continued to increase our sales in the growing service segment.  Our investments in the high-growth areas of our business — commercial, tires, fleet and digital — increased revenue, but temporarily depressed margins.  To date in the first quarter, we have generated higher sales and experienced recovering margins.”

John continued, “With only three weeks to go in the first quarter of 2015, we are seeing a turn around in the business. At this point comparable store sales are up with double digit-growth in commercial, fleet and digital. With margins recovering, combined with improved expense and inventory management, to date we are seeing an improvement in operating profit and cash flow.”

About Pep Boys

Since 1921, Pep Boys has been the nation’s leading automotive aftermarket chain. With over 7,500 service bays in 806 locations in 35 states and Puerto Rico, Pep Boys offers name-brand tires; automotive maintenance and repair; parts and expert advice for the Do-It-Yourselfer; commercial auto parts delivery; and fleet maintenance and repair. Customers can find the nearest location by calling 1-800-PEP-BOYS (1-800-737-2697) or by visiting www.pepboys.com.

Certain statements contained herein constitute “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. The words “guidance,” “expect,” “anticipate,” “estimates,” “targets,” “forecasts” and similar expressions are intended to identify such forward-looking statements. Forward-looking statements include management’s expectations regarding implementation of its long-term strategic plan, future financial performance, automotive aftermarket trends, levels of competition, business development activities, future capital expenditures, financing sources and availability and the effects of regulation and litigation. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be achieved. The Company’s actual results may differ materially from the results discussed in the forward-looking statements due to factors beyond the control of the Company, including the strength of the national and regional economies, retail and commercial consumers’ ability to spend, the health of the various sectors of the automotive aftermarket, the weather in geographical regions with a high concentration of the Company’s stores,

competitive pricing, the location and number of competitors’ stores, product and labor costs and the additional factors described in the Company’s filings with the SEC. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Investors have an opportunity to listen to the Company’s quarterly conference calls discussing its results and related matters. The call for the fourth quarter will be broadcast live on Tuesday, April 14 at 8:30 a.m. EDT over the Internet at the Vcall website, located at www.investorcalendar.com. To listen to the call live, please go to the website at least 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call. Supplemental financial information will be available the morning of Tuesday, April 14 on Pep Boys’ website at www.pepboys.com. In addition, Pep Boys’ investor presentation, also available at www.pepboys.com, will be updated to reflect the Company’s year-to-date results.

###

Investor Contact:

Sanjay Sood

(215) 430-9105

Email: investorrelations@pepboys.com

Pep Boys Financial Highlights

Thirteen weeks ended	January 31, 2015			February 1, 2014
Total revenues	$	502,423,000		$	495,733,000
Net loss	$	(26,666,000	)	$	(3,331,000	)
Basic loss per share:
Average shares	53,816,000			53,422,000
Basic loss per share:	$	(0.50	)	$	(0.06	)
Diluted loss per share:
Average shares	53,816,000			53,968,000
Diluted loss per share:	$	(0.50	)	$	(0.06	)

Fifty-two weeks ended	January 31, 2015			February 1, 2014
Total revenues	$	2,084,603,000		$	2,066,568,000
Net (loss) earnings	$	(27,293,000	)	$	6,865,000
Basic (loss) earnings per share:
Average shares	53,608,000			53,378,000
Basic (loss) earnings per share:	$	(0.51	)	$	0.13
Diluted (loss) earnings per share:
Average shares	53,608,000			53,963,000
Diluted (loss) earnings per share:	$	(0.51	)	$	0.13

EX-99.2

Exhibit 99.2

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(dollar amounts in thousands)

	January 31, 2015			February 1, 2014
Assets
Current assets:
Cash and cash equivalents	$	38,044		$	33,431
Accounts receivable, less allowance for uncollectible accounts of $1,604 and $1,320	31,013			25,152
Merchandise inventories	656,957			672,354
Prepaid expenses	27,952			29,282
Other current assets	55,986			63,405
Assets held for disposal	2,648			2,013
Total current assets	812,600			825,637
Property and equipment, net of accumulated depreciation of $1,251,797 and $1,227,121	604,380			625,525
Goodwill	32,869			56,794
Deferred income taxes	56,571			57,686
Other long-term assets	35,321			39,839
Total assets	$	1,541,741		$	1,605,481
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	227,132		$	256,031
Trade payable program liability	140,904			129,801
Accrued expenses	226,176			237,403
Deferred income taxes	61,216			69,373
Current maturities of long-term debt	2,000			2,000
Total current liabilities	657,428			694,608
Long-term debt less current maturities	211,000			199,500
Other long-term liabilities	45,567			48,485
Deferred gain from asset sales	103,596			114,823
Commitments and contingencies
Stockholders’ equity:
Common stock, par value $1 per share:
Authorized 500,000,000 shares; issued 68,557,041 shares	68,557			68,557
Additional paid-in capital	298,299			297,009
Retained earnings	397,890			432,332
Accumulated other comprehensive income	(391		)	379
Treasury stock, at cost - 14,988,205 shares and 15,358,872 shares	(240,205		)	(250,212		)
Total stockholders’ equity	524,150			548,065
Total liabilities and stockholders’ equity	$	1,541,741		$	1,605,481
Supplemental balance sheet information:
Working capital	$	155,172		$	131,029
Current ratio	1.24			1.19
Accounts payable to inventory ratio	56.0		%	57.4		%
Total debt as a percent of total capitalization	28.9		%	26.9		%
Debt as a percent of total capitalization, net	25.0		%	23.5		%

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME

(dollar amounts in thousands, except per share amounts)

	Thirteen weeks ended										Fifty-two weeks ended
	January 31, 2015					February 1, 2014					January 31, 2015					February 1, 2014
				%					%					%					%
	Amount			Sales		Amount			Sales		Amount			Sales		Amount			Sales
Merchandise sales	$	385,105		76.6		$	384,884		77.6		$	1,593,883		76.5		$	1,608,697		77.8
Service revenue	117,318			23.4		110,849			22.4		490,720			23.5		457,871			22.2
Total revenues	502,423			100.0		495,733			100.0		2,084,603			100.0		2,066,568			100.0
Costs of merchandise sales	280,807			72.9		270,233			70.2		1,124,755			70.6		1,108,359			68.9
Costs of service revenue	121,931			103.9		121,484			109.6		484,404			98.7		470,832			102.8
Total costs of revenues	402,738			80.2		391,717			79.0		1,609,159			77.2		1,579,191			76.4
Gross profit from merchandise sales	104,298			27.1		114,651			29.8		469,128			29.4		500,338			31.1
Gross (loss) profit from service revenue	(4,613		)	(3.9	)	(10,635		)	(9.6	)	6,316			1.3		(12,961		)	(2.8	)
Total gross profit	99,685			19.8		104,016			21.0		475,444			22.8		487,377			23.6
Selling, general and administrative expenses	118,837			23.7		110,617			22.3		484,182			23.2		464,852			22.5
Goodwill impairment	23,925			4.8		0			—		23,925			1.1		—			—
Net (gain) loss from dispositions of assets	(14,325		)	(2.9	)	13			—		(13,806		)	(0.7	)	227			—
Operating (loss) profit	(28,752		)	(5.7	)	(6,614		)	(1.3	)	(18,857		)	(0.9	)	22,298			1.1
Other income	13			—		422			0.1		1,188			0.1		1,789			0.1
Interest expense	(3,604		)	(0.7	)	(3,912		)	(0.8	)	(13,873		)	(0.7	)	(14,797		)	(0.7	)
(Loss) earnings from continuing operations before income taxes and discontinued operations	(32,343		)	(6.4	)	(10,104		)	(2.0	)	(31,542		)	(1.5	)	9,290			0.5
Income tax (benefit) expense	(5,690		)	17.6	(1)	(6,837		)	67.7	(1)	(4,581		)	(14.5	)(1)	2,237			24.1	(1)
(Loss) earnings from continuing operations before discontinued operations	(26,653		)	(5.3	)	(3,267		)	(0.7	)	(26,961		)	(1.3	)	7,053			0.3
Loss from discontinued operations, net of tax	(13		)	—		(64		)	—		(332		)	—		(188		)	—
Net (loss) earnings	(26,666		)	(5.3	)	(3,331		)	(0.7	)	(27,293		)	(1.3	)	6,865			0.3
Basic (loss) earnings per share:
(Loss) earnings from continuing operations before discontinued operations	$	(0.50	)			$	(0.06	)			$	(0.50	)			$	0.13
(Loss) from discontinued operations, net of tax	—					—					(0.01		)			—
Basic (loss) earnings per share	$	(0.50	)			$	(0.06	)			$	(0.51	)			$	0.13
Diluted (loss) earnings per share:
(Loss) earnings from continuing operations before discontinued operations	$	(0.50	)			$	(0.06	)			$	(0.50	)			$	0.13
(Loss) from discontinued operations, net of tax	—					—					(0.01		)			—
Diluted (loss) earnings per share	$	(0.50	)			$	(0.06	)			$	(0.51	)			$	0.13
Other comprehensive (loss) income:
Derivative financial instruments adjustment, net of tax	(434		)			40					(770		)			1,359
Other comprehensive (loss) income	(434		)			40					(770		)			1,359
Comprehensive (loss) income	$	(27,100	)			$	(3,291	)			$	(28,063	)			$	8,224

(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)

Fifty-two weeks ended	January 31, 2015			February 1, 2014
Cash flows from operating activities:
Net (loss) earnings	$	(27,293	)	$	6,865
Adjustments to reconcile net (loss) earnings to net cash provided by continuing operations:
Net loss from discontinued operations	332			188
Depreciation	75,099			78,439
Amortization of deferred gain from asset sales	(13,389		)	(12,604		)
Amortization of deferred financing costs	2,563			2,993
Stock compensation expense	2,257			2,992
Deferred income taxes	(6,588		)	(79		)
Net (gain) loss from dispositions of assets	(13,806		)	227
Asset impairment	7,535			7,659
Goodwill impairment	23,925			—
Other	(139		)	(493		)
Changes in assets and liabilities, net of the effects of acquisitions:
Decrease (increase) in accounts receivable, prepaid expenses and other	4,366			(6,511		)
Decrease (increase) in merchandise inventories	15,397			(31,146		)
(Decrease) increase in accounts payable	(27,963		)	8,378
(Decrease) increase in accrued expenses	(11,853		)	6,115
Decrease in other long-term liabilities	(2,391		)	(3,345		)
Net cash provided by continuing operations	28,052			59,678
Net cash used in discontinued operations	(608		)	(274		)
Net cash provided by operating activities	27,444			59,404
Cash flows from investing activities:
Capital expenditures	(67,269		)	(53,982		)
Proceeds from dispositions of assets	20,227			21
Acquisitions, net of cash acquired	—			(10,694		)
Additions to collateral investment	—			(2,312		)
Release of collateral investment	—			1,650
Net cash used in investing activities	(47,042		)	(65,317		)
Cash flows from financing activities:
Borrowings under line of credit agreements	598,495			40,745
Payments under line of credit agreements	(584,995		)	(37,245		)
Borrowings on trade payable program liability	182,462			154,985
Payments on trade payable program liability	(171,359		)	(174,902		)
Payment for finance issuance cost	—			(770		)
Debt payments	(2,000		)	(2,000		)
Proceeds from stock issuance	1,608			2,095
Repurchase of common stock	—			(2,750		)
Net cash provided by (used in) financing activities	24,211			(19,842		)
Net increase (decrease) in cash and cash equivalents	4,613			(25,755		)
Cash and cash equivalents at beginning of period	33,431			59,186
Cash and cash equivalents at end of period	$	38,044		$	33,431
Supplemental cash flow information:
Cash paid for income taxes	$	1,418		$	4,377
Cash received from income tax refunds	$	292		$	1,251
Cash paid for interest	$	11,377		$	12,027
Accrued purchases of property and equipment	$	3,346		$	3,467

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						Fifty-two weeks ended
		January 31, 2015			February 1, 2014			January 31, 2015			February 1, 2014
(a)    (Loss) earnings from continuing operations before discontinued operations		$	(26,653	)	$	(3,267	)	$	(26,961	)	$	7,053
Loss from discontinued operations, net of tax		(13		)	(64		)	(332		)	(188		)
Net (loss) earnings		$	(26,666	)	$	(3,331	)	$	(27,293	)	$	6,865
(b)    Basic average number of common shares outstanding during period		53,816			53,422			53,608			53,378
Common shares assumed issued upon exercise of dilutive stock options, net of assumed repurchase, at the average market price		—			546			—			585
(c)    Diluted average number of common shares assumed outstanding during period		53,816			53,968			53,608			53,963
Basic (loss) earnings per share:
(Loss) earnings from continuing operations before discontinued operations	(a) / (b)	$	(0.50	)	$	(0.06	)	$	(0.50	)	$	0.13
(Loss) from discontinued operations, net of tax		—			—			(0.01		)	—
Basic (loss) earnings per share		$	(0.50	)	$	(0.06	)	$	(0.51	)	$	0.13
Diluted (loss) earnings per share:
(Loss) earnings from continuing operations before discontinued operations	(a) / (c)	$	(0.50	)	$	(0.06	)	$	(0.50	)	$	0.13
(Loss) from discontinued operations, net of tax		—			—			(0.01		)	—
Diluted (loss) earnings per share		$	(0.50	)	$	(0.06	)	$	(0.51	)	$	0.13

THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES

ADDITIONAL INFORMATION (dollar amounts in thousands)

	Thirteen weeks ended						Fifty-two weeks ended
	January 31, 2015			February 1, 2014			January 31, 2015			February 1, 2014
Capital expenditures	$	12,294		$	15,648		$	67,269		$	53,982
Depreciation	$	19,581		$	18,948		$	75,099		$	78,439
Non-operating income:
Net rental revenue	$	(30	)	$	377		$	1,009		$	1,409
Investment income	35			43			187			175
Other income	8			2			(8		)	205
Total	$	13		$	422		$	1,188		$	1,789
Comparable sales percentages:
Service	5.1		%	1.4		%	4.9		%	1.6		%
Merchandise	-0.2		%	-3.4		%	-1.6		%	-2.1		%
Total	1.3		%	-2.4		%	-0.1		%	-1.3		%
Total square feet of retail space (including service centers)							12,942,000			12,907,000
Store count
Supercenter							563			568
Service & Tire Center							237			225
Retail Only							6			6
Total							806			799
Sales and gross profit by line of business (A):
Service center revenue	$	279,985		$	269,131		$	1,151,575		1,110,958
Retail sales	222,438			226,602			933,028			955,610
Total revenues	$	502,423		$	495,733		$	2,084,603		$	2,066,568
Gross profit from service center revenue, prior to impairment charge	$	49,554		$	43,942		$	235,169		215,181
Service center revenue impairment charge	(1,560		)	(1,836		)	(5,039		)	(5,328		)
Gross profit from service center revenue	$	47,994		$	42,106		$	230,130		$	209,853
Gross profit from retail sales, prior to impairment charge	$	52,422		$	62,851		$	247,809		279,855
Retail sales impairment charge	(731		)	(941		)	(2,495		)	(2,331		)
Gross profit from retail sales	$	51,691		$	61,910		$	245,314		$	277,524
Total gross profit	$	99,685		$	104,016		$	475,444		$	487,377
Comparable sales percentages by line of business (A):
Service center revenue	3.2		%	-0.3		%	1.4		%	0.2		%
Retail sales	-1.0		%	-4.6		%	-1.9		%	-3.1		%
Total revenues	1.3		%	-2.4		%	-0.1		%	-1.3		%
Gross profit percentage by line of business (A):
Gross profit percentage from service center revenue, prior to impairment charge	17.7		%	16.3		%	20.4		%	19.4		%
Impairment charge	(0.6		)	(0.7		)	(0.4		)	(0.5		)
Gross profit percentage from service center revenue	17.1		%	15.6		%	20.0		%	18.9		%
Gross profit percentage from retail sales, prior to impairment charge	23.6		%	27.7		%	26.6		%	29.3		%
Impairment charge	(0.3		)	(0.4		)	(0.3		)	(0.2		)
Gross profit percentage from retail sales	23.2		%	27.3		%	26.3		%	29.0		%
Total gross profit percentage	19.8		%	21.0		%	22.8		%	23.6		%

(A) Retail sales include DIY and commercial sales. Service center revenue includes revenue from labor and installed parts and tires.