Roanoke, Va. Pep Boys sales dropped to $498 million in the first quarter that ended May 3, compared to $539.6 million in the same period last year. Same-store sales were down 5.6%, pushed by a 6.2% drop in same-store merchandise sales. Same-store sales in the services sector experienced a less dramatic 2.9% decline.
However, net earnings for continued operations, fueled by two sale leaseback transactions, increased to $5.3 million from $3.1 million in 2007. In the retailer’s prepared statement, CFO Ray Arthur noted that the sale leaseback transactions allowed reduction of long-term debt by $58.7 million and created a $5.5 million net gain from disposition of assets sold.