Petco Files For IPO

By Chris Lange Updated Apr 28, 3:32AM EDT · Published Sep 25, 4:09PM EDT

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Petco Holdings, Inc. filed an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) regarding its initial public offering. There were no terms given in the filing. The company has yet to disclose what exchange it plans to file on or what symbol it will file under.

The underwriters for the offering are Goldman Sachs, Merrill Lynch, JP Morgan, Credit Suisse, Deutsche Bank, Morgan Stanley, Wells Fargo, Jefferies, TPG Capital, Piper Jaffray, Stifel, Cantor Fitzgerald, Guggenheim, and Nomura.

At the end of August 2015, the company operated 1,409 stores in the U.S. and an additional 13 stores through its joint venture in Mexico. It has two retail formats: Petco, the flagship retail store format, and Unleashed by Petco, a smaller format and up-scale urban lifestyle concept, which enables it to capitalize on real estate opportunities in a variety of urban, suburban and rural markets across the country.

The company offers a robust suite of in-store services that appeal to some pet parents. These services, which cannot be replicated online, include grooming and dog training as well as low-cost vaccination and preventative wellness services, and Petco continues to expand and enhance its services offerings to address this fast-growing market segment. The stores are complemented by the largest ecommerce platform in specialty pet retail, which includes Petco.com, DrsFosterSmith.com, Liveaquaria.com and Unleashed.com, and the company has one of the most followed pet brands on social media.

Petco listed a few financial highlights in the filing as:

Achieving positive comparable sales growth for the 21st most recent consecutive quarters, and averaging 3.5% of comparable sales growth annually from fiscal 2005 to fiscal 2014.
Growing the store base from 779 stores under the Petco banner as of the end of fiscal 2005 to 1,251 stores under the Petco banner and 122 stores under the Unleashed banner as of the end of fiscal 2014, representing a compound annual growth rate (CAGR) of 6.6% on total store base.
Increasing the share of net sales attributable to ecommerce from 1.2% in fiscal 2005 to 8.5% during the first two quarters of fiscal 2015, which includes operations since the acquisition of Drs. Foster and Smith.
Increasing net sales from $1,996 million for fiscal 2005 to $3,995 million for fiscal 2014, representing a CAGR of 8.0%.
Increasing net income from $22 million for fiscal 2010 to $75 million for fiscal 2014, representing a CAGR of 35.3%.
Increasing Adjusted EBITDA from $320 million for fiscal 2010 to $457 million for fiscal 2014, representing a CAGR of 9.3%, and increasing Adjusted Net Income from $46 million for fiscal 2010 to $103 million for fiscal 2014, representing a CAGR of 22.6%.

The company will not receive any proceeds from the offering, instead the selling stockholders will.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.