The Pep Boys — Manny, Moe & Jack recently announced a 167 percent increase in second quarter EPS. According to the company, these results were driven in large part by improved margins, reduced SG&A and strong service operations.

"Since I joined Pep Boys, we have accelerated the company's execution of previously initiated programs to improve its operational efficiency and move towards monetizing certain real estate assets," says the company's President and CEO Jeffrey Rachor. "Our efforts to expand margins and manage down our cost structure have yielded improved operating performance in the first half of the year, while both our retail and service center operations have improved gross margin rates. And while we have continued to focus on improving our merchandise margin mix, which contributed to material improvements in profitability in the second quarter, we recognize the importance of permanently reversing retail sales trends with a sustainable core merchandising program."

Sales for the 13 weeks ended August 4 were $559 million as compared to the $579 million for the 13 weeks ended July 29, 2006. Comparable sales decreased 3.6 percent, including a 5.1 percent comparable merchandise sales decrease and a 3.8 percent comparable service revenue increase. In accordance with GAAP, merchandise sales includes merchandise sold through both the company's retail and service center lines of business, while service revenue is limited to labor sales. Recategorizing sales into the respective lines of business from which they are generated, comparable retail sales (DIY and commercial) decreased 9.0 percent and comparable service center revenue (labor plus installed merchandise and tires) increased 4.9 percent.

Net earnings from continuing operations before cumulative effect of change in accounting principle increased from $1.4 million ($0.03 per share, basic and diluted) to $4.2 million ($0.08 per share, basic and diluted).

Sales for the 26 weeks ended August 4 were $1.1 million, 2.7 percent less than what was recorded last year. Comparable sales decreased 3 percent, including a 4.1 percent comparable merchandise sales decrease and a 2.6 percent comparable service revenue increase. Recategorizing sales and comparable retail sales decreased 6.9 percent, while comparable service center revenue increased 2.9 percent.

Net earnings from continuing operations before cumulative effect of change in accounting principle improved from $603,000 ($0.01 per share, basic and diluted) to $7.4 million ($0.14 per share, basic and diluted) for the 26 weeks ended August 4.

CFO Harry Yanowitz adds, "Our trailing four quarter operating l(oss) profit has improved from a loss of $5 million to a profit of $50.1 million while our trailing four quarter EBITDA, a non-GAAP indicator of levels of our financial performance that includes the gains and charges noted above, increased from $81.3 million to $144.4 million.";

To learn more about the Pep Boys and/or to find the nearest store's location, visit the company's Web site or call (800) PEP-BOYS.