Petco Health and Wellness pany(WOOF) - 2025 Q4 - Annual Results

Financial Performance - Q4 2024 net revenue was $1.6 billion, a decrease of 7.3% year over year, impacted by the loss of the 53rd week in 2023[4] - Full year 2024 net revenue totaled $6.1 billion, down 2.2% year over year, with comparable sales increasing by 0.3%[4] - Adjusted EBITDA for Q4 2024 was $96.1 million, compared to $105.3 million in the previous year, while full year adjusted EBITDA was $336.5 million, down from $401.1 million[4] - The company expects low single-digit percentage decline in net revenue for FY 2025, with adjusted EBITDA guidance of $375 million to $390 million[5] - Q1 2025 guidance indicates a low single-digit decline in net revenue, with adjusted EBITDA projected between $82 million and $83 million[6] - Gross profit for Q4 2024 was $589.3 million, a decrease of 2.8% year over year, while full year gross profit was $2.3 billion, down 1.3%[4] - GAAP net loss for Q4 2024 was $13.8 million, an improvement from a loss of $22.6 million in the previous year, while the full year net loss was $101.8 million compared to $1.3 billion in the prior year[4] Cash Flow and Assets - Operating cash flow for FY 2024 was $177.7 million, down from $215.7 million in the previous year, while free cash flow improved to $49.7 million from a negative $9.9 million[4] - Cash and cash equivalents increased from $136,649 million at the beginning of the period to $181,665 million at the end of the period, reflecting a net increase of $45,016 million[19] - Free Cash Flow improved to $49,683 million for the 52 weeks ended February 1, 2025, compared to a negative Free Cash Flow of $9,879 million for the 53 weeks ended February 3, 2024[26] - Total assets decreased from $5,363,152 million in 2024 to $5,194,430 million in 2025, a decline of approximately 3.15%[16] Liabilities and Equity - Total current liabilities rose from $1,113,143 million in 2024 to $1,139,163 million in 2025, an increase of approximately 2.33%[16] - The total stockholders' equity decreased from $1,184,429 million in 2024 to $1,113,630 million in 2025, a decline of approximately 5.98%[16] Inventory and Capital Expenditures - Merchandise inventories decreased from $684,502 million in 2024 to $653,329 million in 2025, a reduction of about 4.56%[16] - Cash paid for fixed assets decreased from $225,598 million in 2024 to $127,990 million in 2025, a reduction of about 43.3%[19] Profitability Metrics - The company reported a net margin of -1.7% for the 52 weeks ended February 1, 2025, compared to -20.5% for the previous year[23] - Net loss for the 52 weeks ended February 1, 2025, was $101,816 million, compared to a net loss of $1,280,210 million for the 53 weeks ended February 3, 2024[19] - Adjusted EBITDA for the 52 weeks ended February 1, 2025, was $336,526 million, down from $401,103 million for the 53 weeks ended February 3, 2024, representing a decrease of about 16.1%[23] Quarterly Performance - Net income for the 13 weeks ended February 1, 2025, was $10,224,000, a decrease of 17% compared to $12,311,000 for the same period in 2024[28] - EBITDA for the 13 weeks ended February 1, 2025, was $22,466,000, down 4.5% from $23,518,000 in the prior year[28] - The company reported a 50% share of EBITDA amounting to $11,233,000 for the 13 weeks ended February 1, 2025, compared to $11,759,000 in the same period last year[28] Expenses and Taxation - Depreciation expenses for the 13 weeks ended February 1, 2025, were $6,536,000, compared to $7,070,000 in the same period last year, reflecting a decrease of 7.5%[28] - Interest expense, net, decreased to $516,000 for the 13 weeks ended February 1, 2025, from $1,039,000 in the prior year, a reduction of 50%[28] - Income tax expense increased to $5,014,000 for the 13 weeks ended February 1, 2025, from $2,541,000 in the same period last year, representing a significant increase of 97%[28] Strategic Initiatives - The company plans approximately 20-30 net closures of real estate locations in FY 2025[5] - Petco's leadership team is focused on achieving double-digit adjusted EBITDA growth in 2025, aiming for sustainable profitable growth[4] - Acquisition and divestiture-related integration costs were incurred, reflecting the company's ongoing strategic transactions and business integration efforts[29] Foreign Currency Impact - The company incurred foreign currency losses of $176,000 for the 13 weeks ended February 1, 2025, compared to $557,000 in the same period in 2024[28]