Pep Boys posts profit on higher revenue

AP News
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Posted: Dec 07, 2009 6:03 PM

Auto parts retailer Pep Boys posted a third-quarter profit on Monday and sales higher than a year earlier thanks to an increase in service work.

The chain said it earned $2.1 million, or 4 cents per share, compared with a loss of $7.3 million, or 14 cents per share, a year ago.

The results included a $3.3 million drop in the value of its assets but also $3 million in one-time gains, including sale-leaseback proceeds and an insurance settlement.

The results met analysts' forecast for 4 cents per share profit.

The company's sales rose 1.8 percent to $472.6 million in the quarter that ended Oct. 31, slightly more than the $468.5 million predicted by analysts surveyed by Thomson Reuters.

Service revenue at stores open more than a year increased 8.9 percent but merchandise sales, which includes items sold by the service centers, dipped 0.1 percent.

It was the company's first gain in this key retail indicator since the fourth quarter of 2006.

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Pep Boys said it was pleased with the increase in sales to do-it-yourself vehicle owners but said consumer spending is likely to remain conservative through the holidays. The company has about 580 stores and 6,000 service bays.

Its shares rose 47 cents, or 5.3 percent, to $9.27 in regular trading, then fell 51 cents, or 5.5 percent, to $8.71 in about an hour of extended trading after the results were announced.