Pep Boys Posts Profit On Lower Costs, Yet Misses Estimate; Stock Down - Update

(RTTNews) - Auto parts retailer Pep Boys - Manny, Moe & Jack (PBY) said Monday it swung to a third-quarter profit, helped mainly by lower impairment charges that offset a marginal decline in sales.

However, results for the quarter missed Wall Street estimates, sending Pep Boys shares down 12 percent in after-hours trade on the New York Stock Exchange.

Pep Boys has had been struggling in the last few quarters amid economy volatility and soft consumer spending, while problems crept up in the execution of its business strategy.

CEO Mike Odell said that while tire sales have started to improve, competitive pressures do remain.

Philadelphia, Pennsylvania-based Pep Boys posted quarterly net income of $1 million or $0.02 per share, compared with a net loss of $6.8 million or $0.13 per share last year.

On average, four analysts polled by Thomson Reuters estimated earnings of $0.14 per share for the quarter. Analysts' estimates typically exclude special items.

Results for the recent quarter included a $2 million asset impairment charge, while the prior year had $11 million in debt refinancing expense and about $9 million impairment charge.

Sales for the quarter edged down 0.5 percent to $507.04 million from $509.6 million in the prior year. Analysts estimated revenue of $521.74 million.

On a same store basis, sales for the quarter were down 2.8 percent.

Pep Boys stock closed Monday at $13.41, down $0.03 or 0.22%, on a volume of 382 thousand shares. In after hours, the stock dropped $1.65 or 12.30% at $11.76.