PetSmart Confirms Exploring Sale; Beats Q2 Earnings Views
PetSmart (NASDAQ: PETM) edged up in the extended session Tuesday after it confirmed a report earlier that it will explore a possible sale of the company.
Separately, the company also posted second-quarter earnings that beat Street views with revenue in line with expectations. It also said it will acquire online pet supplies retailer Pet360 for $130 million.
PetSmart offered a third-quarter outlook calling for same-store sales flat to slightly down, along with earnings in line with expectations.
Chairman Gregory P. Josefowicz said the company has no timetable for its review of strategic alternative and won't comment further or update the market until the review of is completed.
Reuters reported earlier Tuesday that several shareholders led by activist 9.8 percent holder Jana Partners have succeeded in efforts pushing the pet supply retailer to sell itself.
Jana, led by activist investor Barry Rosenstein, has pushed for a sale of PetSmart since last month.
PetSmart said its acquisition of Pet360, expected to close in September, includes additional performance-based payments of up to $30 million.
For the recent second quarter, the company posted earnings of $98.1 million or $0.98 a share, up from year-earlier earnings of $93.4 million or $0.89 a share.
Revenue grew to $1.72 billion from $1.7 billion a year earlier, while same-store sales fell 0.5 percent.
Wall Street expected earnings of $0.94 a share on revenue of $1.73 billion.
PetSmart traded recently after hours up 1.3 percent at $69.70 a share.
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