PetMed Express Inc. PETS, -9.97% shares slumped 11% in Monday premarket trading after the pet pharmacy company announced first-quarter earnings and sales that missed Street expectations. Net income totaled $4.4 million, or 22 cents per share, down from $7.8 million, or 39 cents per share, last year. Sales totaled $79.3 million, down from $96.2 million. The FactSet consensus was for EPS of 37 cents and sales of $87.7 million. During the quarter, the company incurred a $717,000 charge tied to its chief executive separation agreement, and $260,000 for brand and marketing consulting fees. “[D]uring the most recent quarter while the pandemic was abating and stores were re-opening, the advertising market was rapidly recovering with demand driving up ad prices dramatically,” said Chief Executive Mendo Akdag in a statement. Akdag will be leaving the company on July 30. “As a result, our advertising spending delivered fewer ad impressions than in prior years. Because of this, we believe our advertising spending was less effective in the most recent quarter in its ability to attract new customers.” PetMed also says the purchase of medicine directly from vets during annual exams drove down quarterly results. “We would expect to see stronger reorder sales in the back half of FY 2022, as we anticipate more prescriptions being renewed,” Akdag said. Pet adoptions soared during the pandemic. PetMed also declared a dividend of 30 cents per share payable on August 13, 2021 to shareholders of record as of August 6, 2021. PetMed stock has fallen 13.4% for the year to date while the S&P 500 index SPX, -0.06% has gained 17.5% for the period.
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