-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JUCgCnrIcxkTp3Ax727gr2YG9XAdinBnGzb1kLqN/pf1/4ic1dqsX3BRoKUsPj35 XVb3ePTDwPKwYyRomN5xCQ== 0000888455-99-000010.txt : 19990615 0000888455-99-000010.hdr.sgml : 19990615 ACCESSION NUMBER: 0000888455-99-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990501 FILED AS OF DATE: 19990614 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PETCO ANIMAL SUPPLIES INC CENTRAL INDEX KEY: 0000888455 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-RETAIL STORES, NEC [5990] IRS NUMBER: 330479906 STATE OF INCORPORATION: DE FISCAL YEAR END: 0128 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-23574 FILM NUMBER: 99645696 BUSINESS ADDRESS: STREET 1: 9125 REHCO RD CITY: SAN DIEGO STATE: CA ZIP: 92121 BUSINESS PHONE: 6194537845 MAIL ADDRESS: STREET 1: 9125 REHCO RD CITY: SAN DIEGO STATE: CA ZIP: 92121 10-Q 1 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 -------------------- FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended May 1, 1999 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to __________ ----------------- Commission file number: 000-23574 PETCO ANIMAL SUPPLIES, INC. (Exact name of registrant as specified in its charter) Delaware 33-0479906 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 9125 Rehco Road, San Diego, California 92121 (Address of principal executive office) (Zip Code) (619) 453-7845 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___ (Indicate the number of shares of each of the registrant's classes of common stock, as of the latest practicable date.) Title Date Outstanding - ----- ---- ----------- Common Stock, $0.0001 Par Value June 8, 1999 21,088,054 PETCO Animal Supplies, Inc. Form 10-Q For the Quarter Ended May 1, 1999 Index Part I Financial Information Page Item 1. Consolidated Financial Statements Consolidated Balance Sheets at January 30, 1999 and May 1, 1999 3 Consolidated Statements of Operations for the thirteen weeks ended May 2, 1998 and May 1, 1999 4 Consolidated Statements of Cash Flows for the thirteen weeks ended May 2, 1998 and May 1, 1999 5 Notes to Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 Item 3. Quantitative and Qualitative Disclosures about Market Risk 12 Part II Other Information Item 1. Legal Proceedings 12 Item 5. Other Information 13 Item 6. Exhibits and Reports on Form 8-K 13 Signatures 14 PETCO ANIMAL SUPPLIES, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except per share data)
January 30, May 1, 1999 1999 ----------- ----------- ASSETS (unaudited) Current assets: Cash and cash equivalents $ 2,324 $ 4,313 Receivables 7,638 9,567 Inventories 104,789 106,348 Deferred tax assets 16,769 14,671 Other 5,993 6,013 ------- ------- Total current assets 137,513 140,912 Fixed assets, net 187,510 189,931 Goodwill 37,804 37,056 Deferred tax assets 9,681 9,681 Other assets 14,627 16,137 ------- ------- $387,135 $393,717 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 51,099 $ 45,730 Accrued expenses 23,783 23,936 Accrued salaries and employee benefits 9,792 11,889 Current portion of long-term debt 4,500 4,500 Current portion of capital lease and other obligations 9,023 8,863 ------- ------- Total current liabilities 98,197 94,918 Long-term debt, excluding current portion 65,375 74,250 Capital lease and other obligations, excluding current portion 20,982 18,579 Accrued store closing costs 7,005 6,615 Deferred rent 11,735 11,952 Stockholders' equity: Common stock, $0.0001 par value, 100,000 shares authorized, 21,074 and 21,074 shares issued and outstanding, respectively 2 2 Additional paid-in capital 270,916 270,916 Accumulated deficit (87,077) (83,515) ------- ------- Total stockholders' equity 183,841 187,403 ------- ------- $387,135 $393,717 ======= ======= See accompanying notes to consolidated financial statements.
3 PETCO ANIMAL SUPPLIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited, in thousands, except per share data)
Thirteen weeks ended ----------------------- May 2, May 1, 1998 1999 --------- --------- Net sales $196,296 $229,657 Cost of sales and occupancy costs 149,620 170,535 ------- ------- Gross profit 46,676 59,122 Selling, general and administrative expenses 40,629 51,310 Merger and business integration costs 6,385 -- ------- ------- Operating income (loss) (338) 7,812 Interest expense, net 1,122 1,924 ------- ------- Earnings (loss) before income taxes (1,460) 5,888 Income taxes (benefit) (392) 2,326 ------- ------- Net earnings (loss) $ (1,068) $ 3,562 ======= ======= Basic and diluted earnings (loss) per common share $ (0.05) $ 0.17 ======= ======= See accompanying notes to consolidated financial statements.
4 PETCO ANIMAL SUPPLIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited, in thousands)
Thirteen weeks ended ------------------------ May 2, May 1, 1998 1999 ----------- ----------- Cash flows from operating activities: Net earnings (loss) $ (1,068) $ 3,562 Depreciation and amortization 6,984 9,044 Deferred tax assets (392) 2,098 Loss on retirement of fixed assets 100 -- Changes in assets and liabilities, net of effects of purchase acquisitions: Receivables (1,366) (1,929) Inventories 4,055 (1,559) Other assets (623) 379 Accounts payable (10,458) (5,369) Accrued expenses 1,477 153 Accrued salaries and employee benefits (326) 2,097 Accrued store closing costs (609) 181 Deferred rent 414 217 ------- ------- Net cash provided by (used in) operating activities (1,812) 8,874 ------- ------- Cash flows from investing activities: Additions to fixed assets (12,762) (11,174) Investment in limited partnership -- (1,983) Net cash invested in acquisitions of businesses -- (40) Change in other assets (894) -- ------- ------- Net cash used in investing activities (13,656) (13,197) ------- ------- Cash flows from financing activities: Borrowings under long-term debt agreements 17,500 10,000 Repayment of long-term debt agreements (1,125) (1,125) Repayment of capital lease and other obligations (1,488) (2,563) Proceeds from the issuance of common stock 131 -- Net cash provided by financing activities 15,018 6,312 ------- ------- Net increase (decrease) in cash and cash equivalents (450) 1,989 Cash and cash equivalents at beginning of year 3,354 2,324 ------- ------- Cash and cash equivalents at end of period $ 2,904 $ 4,313 ======= ======= See accompanying notes to consolidated financial statements.
5 PETCO ANIMAL SUPPLIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands) Note 1 - General In the opinion of management of Petco Animal Supplies, Inc. (the "Company" or "PETCO"), the unaudited consolidated financial statements presented herein contain all adjustments, consisting of normal recurring adjustments, necessary to present the financial position, results of operations and cash flows as of May 1, 1999, and for the periods ended May 2, 1998 and May 1, 1999. Certain prior year balances have been reclassified to conform to current year presentation. Because of the seasonal nature of the Company's business, the results of operations for the thirteen weeks ended May 2, 1998 and May 1, 1999 are not necessarily indicative of the results to be expected for the full year. The Company's fiscal year ends on the Saturday closest to January 31, resulting in years of either 52 or 53 weeks. All references to a fiscal year refer to the fiscal year ending on the Saturday closest to January 31 of the following year. For example, references to fiscal 1998 refer to the fiscal year beginning on February 1, 1998, and ending on January 30, 1999. For further information, refer to the consolidated financial statements and footnotes thereto for fiscal 1998 included in the Company's Form 10-K Annual Report (File No. 000-23574) filed with the Securities and Exchange Commission on April 30, 1999. Note 2 - Business Combinations The Company recorded merger and business integration costs of $6,385 during the thirteen weeks ended May 2, 1998. These costs, related to acquisitions in prior years, include transaction costs, costs attributable to lease cancellation and closure of duplicate or inadequate facilities and activities, facility conversion costs, cancellation of certain contractual obligations and other integration costs. Note 3 - Net Earnings (Loss) Per Share Basic net earnings (loss) per common share are computed using the weighted average number of common shares outstanding during the period. Diluted net earnings (loss) per common share incorporates the incremental shares issuable upon the assumed exercise of stock options. Net earnings (loss) and weighted average common shares used to compute net earnings (loss) per share, basic and diluted, are presented below:
Thirteen Weeks Ended ---------------------- May 2, May 1, 1998 1999 ---------- ---------- Net earnings (loss) $ (1,068) $ 3,562 ====== ====== Common shares, basic 21,072 21,074 Dilutive effect of stock options -- 67 ------ ------ Common shares, diluted 21,072 21,141 ====== ======
Dilutive effect of stock options of 248 shares was not included in computing diluted loss per share for the thirteen weeks ended May 2, 1998 because the effect would have been antidilutive. 6 Note 4 - Contingencies The Company and certain of its officers have been named as defendants in several virtually identical class action lawsuits filed in the United States District Court for the Southern District of California between August and November, 1998. These cases have been consolidated and will be administered as one case. The plaintiffs purport to represent a class of all persons who purchased the Company's common stock between January 30, 1997 and July 10, 1998. The complaints allege that the defendants violated various federal securities laws through material misrepresentations and omissions during the class period, and seek unspecified monetary damages. These matters have been tendered to the Company's insurance carrier. While the Company believes the allegations contained in these lawsuits are without merit, the claims have not progressed sufficiently for the Company to estimate a range of possible exposure, if any. The Company and its officers intend to defend themselves vigorously. The Company has been named as a defendant in a lawsuit filed by the United States Equal Employment Opportunity Commission in the United States District Court for the Northern District of California on June 2, 1999. The complaint alleges that the Company violated Title VII of the Civil Rights Act of 1964, as amended, and the Equal Pay Act, by payment of wages to employees of one sex at rates less than the rates paid to employees of the opposite sex. The complaint seeks unspecified monetary damages for the named employees and any other similarly-situated employees. While the Company believes the allegations contained in this lawsuit are without merit, the claim has not progressed sufficiently for the Company to estimate a range of possible exposure, if any. The Company intends to defend itself vigorously. 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations General PETCO is a leading specialty retailer of premium pet food and supplies. As of May 1, 1999, the Company operated 482 stores in 37 states and the District of Columbia. PETCO's strategy is to be the leading category-dominant national chain of community pet food and supply superstores by offering its customers a complete assortment of pet-related products at competitive prices, with superior levels of customer service at convenient locations. Results of Operations First Quarter 1999 Compared to First Quarter 1998 Net sales increased 17.0% to $229.7 million for the thirteen weeks ended May 1, 1999 ("first quarter 1999") from $196.3 million for the thirteen weeks ended May 2, 1998 ("first quarter 1998"). The increase in net sales in first quarter 1999 resulted primarily from the comparable store net sales increase of 10.9% and the addition of 48 superstores, partially offset by the closing of 24 stores, of which nine were relocated. The comparable store net sales increase was attributable to maturing superstores, increased marketing and merchandising efforts and increased customer traffic. The increase in comparable store net sales accounted for approximately $21.2 million, or 63.5%, of the net sales increase. The net increase in the Company's store base accounted for approximately $12.2 million, or 36.5%, of the net sales increase. Gross profit, defined as net sales less cost of sales including store occupancy costs, increased to $59.1 million in first quarter 1999 from $46.7 million in first quarter 1998. As a percentage of sales, gross profit increased to 25.7% in first quarter 1999 from 23.8% in first quarter 1998. Gross profit increased from the prior year primarily through greater purchasing leverage, particularly in acquired stores which were selling through non-continuing inventories at reduced gross margins in prior year, and increased leverage of occupancy costs. Selling, general and administrative expenses increased to $51.3 million in first quarter 1999 from $40.6 million in first quarter 1998. As a percentage of net sales, these expenses increased to 22.3% in first quarter 1999 from 20.7% in first quarter 1998. The increase was due primarily to increased personnel and related costs associated with decentralization of field staff, new store openings, store training costs, advertising, and depreciation and maintenance of the Company's investments in infrastructure in the prior year. Merger and business integration costs of $6.4 million were recorded in first quarter 1998 in connection with the acquisition and conversion activities of the stores acquired in prior years. Operating income in first quarter 1999 was $7.8 million, or 3.4% of net sales, compared with an operating loss of $0.3 million in first quarter 1998. Excluding merger and business integration costs in the prior year, the Company would have reported operating income of $6.1 million, or 3.1% of net sales, in first quarter 1998. Net interest expense was $1.9 million for first quarter 1999, compared with net interest expense of $1.1 million for first quarter 1998. Increased borrowings in first quarter 1999 led to the increase in interest expense. 8 Income tax expense was $2.3 million in first quarter 1999, compared to income tax benefit of $0.4 million in first quarter 1998. Income tax benefit reflects the Federal and state tax benefits of the loss before income taxes, net of the effect of non-deductible expenses. Net earnings were $3.6 million, or $0.17 per diluted share, for first quarter 1999 compared with a net loss of $1.1 million, or $0.05 per diluted share, for first quarter 1998. Excluding merger and business integration costs and related tax benefits in the prior year, net earnings for first quarter 1998 would have been $3.0 million, or $0.14 per diluted share. Year 2000 Issues In 1997, the Company implemented a comprehensive risk-based program to assure that both its information technology ("IT") and non-IT systems are Year 2000 compliant. The Company's compliance program includes various initiatives, including conducting an inventory and identification of all Year 2000-sensitive components of the Company's IT and non-IT systems (including hardware, software, security, and telecommunications), requesting compliance status statements from the Company's business partners, suppliers and vendors, and testing of new and existing systems. The inventory and identification of Year 2000 IT and non-IT issues is complete. Many Year 2000 IT issues have been resolved through hardware and software updates and upgrades undertaken for other reasons. As part of the Company's ongoing IT upgrade plans, in fiscal 1998 the Company completed the conversion of its store point-of-sale systems to a Year 2000 compliant version at a cost of approximately $20 million, which has been capitalized and will be depreciated over the components' estimated useful lives. This conversion, although not undertaken specifically for Year 2000 purposes, was accelerated in order to achieve Year 2000 compliance in this critical area. With respect to non-IT systems, the Company has completed the inventory and assessment of its embedded systems contained in the corporate offices, distribution centers and store locations. This assessment focused principally on the Company's telecommunications system hardware and software and security systems. The amount of other expenditures for updates and upgrades that relate specifically to Year 2000 compliance is not separable from the total, but is not believed to be a material amount. The remediation and testing of new and existing IT and non-IT systems is nearly complete, and additional procedures will be conducted as necessary. For certain of the Company's key suppliers, such as pet food suppliers, the disruption of product deliveries would have a material adverse impact on the Company's results of operations. The Company is actively extending its relationships with these suppliers to include joint Year 2000 risk assessments, remedial actions, and contingency plans in the event of non-compliance. Contingency plans, which will undergo continuous review and adjustment throughout the remainder of 1999, may include backup manual ordering procedures and inventory buildup by the Company prior to December 31, 1999. Any additional inventory buildup by the Company would generate unfavorable cash flows and inventory valuation exposures of uncertain amount and duration. The Company does not expect the future cost of its Year 2000 compliance program to be material to its business, results of operations, or financial condition. There can be no assurance, however, that the Company's assessment of the impact of Year 2000 is complete and that further analysis and study, as well as the testing and implementation of planned solutions, will not reveal the need for additional remedial work. The Company is potentially vulnerable to mistakes made by key suppliers of products and services in their advice to the Company with respect to their Year 2000 readiness. The Company is also potentially vulnerable to operational difficulties in the Company's corporate offices, distribution centers or store locations, including the risk of power and water outages and the potential failure of credit card and check authorization systems. The financial magnitude of these risks cannot currently be estimated. 9 The foregoing statements as to the Company's Year 2000 efforts are forward looking and, along with all other forward-looking statements herein, are made in reliance on the safe harbor provisions discussed under the caption "Certain Cautionary Statements," below. New Accounting Standards In March 1998, the American Institute of Certified Public Accountants ("AICPA") issued Statement of Position 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use" ("SOP 98-1"). Generally, SOP 98-1 requires the capitalization of certain internal and external costs associated with the application development stage of software development. The Company adopted this statement on January 31, 1999 as required. The adoption of SOP 98-1 did not have a material impact on the Company's results of operations or financial condition. In April 1998, the AICPA issued Statement of Position 98-5, "Accounting for the Costs of Start-up Activities" ("SOP 98-5"). Generally, SOP 98-5 requires that the costs of start-up activities be expensed as incurred. The Company adopted this statement on January 31, 1999 as required. The adoption of SOP 98-5 did not have a material impact on the Company's results of operations or financial condition. In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities"(the "Statement"). The Statement establishes accounting and reporting standards requiring that every derivative instrument be recorded in the balance sheet as either an asset or liability measured at its fair value. The Statement also requires that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. The Statement is effective for fiscal years beginning after June 15, 2000 and is not expected to have a material impact on the Company's consolidated financial statements. Liquidity and Capital Resources The Company has financed its operations and expansion program through internal cash flow, external borrowings and the sale of equity securities. At May 1, 1999, total assets were $393.7 million, $140.9 million of which were current assets. Net cash provided by operating activities was $8.9 million for the thirteen weeks ended May 1, 1999, compared with net cash used in operating activities of $1.8 million for the prior year period. The Company's sales are substantially on a cash basis. Therefore, cash flow generated from operating stores provides a significant source of liquidity to the Company. The principal use of operating cash is for the purchase of merchandise inventories. A portion of the Company's inventory purchases is financed through vendor credit terms. The Company uses cash in investing activities to purchase fixed assets for new stores, to acquire stores, and, to a lesser extent, to purchase warehouse and office fixtures, equipment and computer hardware and software in support of its distribution and administrative functions. During the first quarter of fiscal 1999 the Company invested $2.0 million in a limited partnership that operates retail pet food and supply stores in Canada, with plans to open additional stores. Cash used in investing activities was $13.2 million for the thirteen weeks ended May 1, 1999, and $13.7 million for the prior year period. 10 The Company also finances some of its purchases of equipment and fixtures through capital lease and other obligations. No purchases of fixed assets were financed in this manner during the thirteen weeks periods ended May 1, 1999, and May 2, 1998. The Company believes that additional sources of capital lease and other obligation financing are available on a cost-effective basis and plans to use them, as necessary, in connection with its expansion program. The Company's primary long-term capital requirement is funding for the opening or acquisition of superstores. Cash flows provided by financing activities were $6.3 million in the thirteen weeks ended May 1, 1999, and $15.0 million in the prior year period. Cash flows from financing activities were provided by borrowings under long-term debt agreements, net of repayments under long-term debt and other obligations. Cash flows from financing activities were used to fund the Company's expansion program and working capital requirements. The Company has a credit facility with a syndicate of banks with a commitment of up to $110.0 million that expires January 30, 2003. The credit facility provides for $80.0 million in revolving loans and a $30.0 million term loan. Borrowings under the credit facility are unsecured and bear interest, at the Company's option, at the agent bank's corporate base rate or LIBOR plus 0.50% to 1.50%, based on the Company's leverage ratio at the time. The credit agreement contains certain affirmative and negative covenants related to indebtedness, interest and fixed charges coverage, and consolidated net worth. As of May 1, 1999, the Company had $26.8 million of revolving loans available under the credit facility. As of January 30, 1999, the Company had available net operating loss carryforwards of $71.2 million for federal income tax purposes, which begin expiring in 2004, and $35.5 million for state income tax purposes, which begin expiring in 1999. The Company anticipates that funds generated by operations, funds available under the credit facility and currently available vendor financing and capital lease and other obligation financing will be sufficient to finance its continued operations and planned store openings at least through the next twelve months. Certain Cautionary Statements Certain statements in this Quarterly Report on Form 10 - Q, including, but not limited to, Item 2 - "Management's Discussion and Analysis of Financial Condition and Results of Operations," contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, that are not historical facts but rather reflect current expectations concerning future results and events. The words "believes," "expects," "intends," "plans," "anticipates," "likely," "will," and similar expressions identify such forward-looking statements. These forward-looking statements are subject to risks, uncertainties, and other factors, some of which are beyond the Company's control that could cause actual results to differ materially from those forecast or anticipated in such forward-looking statements. These factors include, but are not limited to, the Company's expansion plans, the integration of operations as a result of acquisitions, reliance on vendors and product lines and exclusive distribution arrangements, competition, performance of new superstores and their future operating results, quarterly and seasonal fluctuations, dependence on senior management, and possible volatility of stock price. These factors are discussed in greater detail under the caption "Certain Cautionary Statements" in PETCO's Annual Report on Form 10-K for the year ended January 30, 1999. 11 Item 3. Quantitative and Qualitative Disclosures About Market Risk Market risks relating to the Company's operations result primarily from changes in short-term interest rates as the Company's unsecured credit facility utilizes a portfolio of short-term LIBOR contracts. LIBOR contracts are fixed rate instruments for a period of between one and six months, at the Company's discretion. The Company's portfolio of LIBOR contracts vary in length and interest rate, such that adverse changes in short-term interest rates could affect the Company's overall borrowing rate when contracts are renewed. The lengths of contracts within the portfolio are adjusted to balance the Company's working capital requirements, fixed asset purchases and general corporate purposes. The Company continuously evaluates the portfolio with respect to total debt, including an assessment of the current and future economic environment. As of May 1, 1999, the Company had $78.8 million in debt under the credit facility. The average debt outstanding for the last four quarters was $74.5 million. Based on this average debt level, a hypothetical 50 basis point adverse change in LIBOR rates would increase net interest expense by approximately $0.4 million on an annual basis, and likewise would decrease earnings and cash flows. The Company cannot predict market fluctuations in interest rates and their impact on debt, nor can there be any assurance that long-term fixed-rate debt will be available at favorable rates, if at all. Consequently, future results may differ materially from the estimated results due to adverse changes in interest rates or debt availability. The Company did not have any material foreign exchange or other significant market risk or any derivative financial instruments at May 1, 1999. Part II. Other Information Item 1. Legal Proceedings The Company and certain of its officers have been named as defendants in several virtually identical class action lawsuits filed in the United States District Court for the Southern District of California between August and November, 1998. These cases have been consolidated and will be administered as one case. The plaintiffs purport to represent a class of all persons who purchased the Company's common stock between January 30, 1997 and July 10, 1998. The complaints allege that the defendants violated various federal securities laws through material misrepresentations and omissions during the class period, and seek unspecified monetary damages. These matters have been tendered to the Company's insurance carrier. While the Company believes the allegations contained in these lawsuits are without merit, the claims have not progressed sufficiently for the Company to estimate a range of possible exposure, if any. The Company and its officers intend to defend themselves vigorously. 12 Item 5. Other Information The Company has been named as a defendant in a lawsuit filed by the United States Equal Employment Opportunity Commission in the United States District Court for the Northern District of California on June 2, 1999. The complaint alleges that the Company violated Title VII of the Civil Rights Act of 1964, as amended, and the Equal Pay Act, by payment of wages to employees of one sex at rates less than the rates paid to employees of the opposite sex. The complaint seeks unspecified monetary damages for the named employees and any other similarly-situated employees. While the Company believes the allegations contained in this lawsuit are without merit, the claim has not progressed sufficiently for the Company to estimate a range of possible exposure, if any. The Company intends to defend itself vigorously. Item 6. Exhibits and Reports on Form 8-K 1. Exhibits (a) 27.1 Financial Data Schedule (filed electronically only) 2. Reports on Form 8-K (a) The Company filed no reports on form 8-K during the thirteen weeks ended May 1, 1999. 13 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, thereunto duly authorized. PETCO ANIMAL SUPPLIES, INC. By: /s/ James M. Myers ------------------ James M. Myers Senior Vice President and Chief Financial Officer Date: June 14, 1999 14 EX-27 2
5 3-MOS 3-MOS JAN-30-1999 JAN-29-2000 MAY-02-1998 MAY-01-1999 2,904 4,313 0 0 12,245 9,567 0 0 92,818 106,348 121,995 140,912 153,946 189,931 0 0 339,251 393,717 81,207 94,918 0 0 0 0 0 0 2 2 185,118 187,401 339,251 393,717 196,296 229,657 196,296 229,657 149,620 170,535 149,620 170,535 47,014 51,310 0 0 1,122 1,924 (1,460) 5,888 (392) 2,326 (1,068) 3,562 0 0 0 0 0 0 (1,068) 3,562 (0.05) 0.17 (0.05) 0.17
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