Petsmart first quarter 2005

Petsmart reported a strong first quarter for 2005. Sales rose 13.4 percent to $903.2 million, beating analysts' estimates by over 1 percent. Same store sales comps grew 5.7 percent.

Executives cited pet services like grooming, training and boarding as important drivers of profitability, with services growing 20.8 percent in the first quarter.

Boarding services, or PETsHOTEL, are currently inside 17 stores, or only 2.3 percent of existing PETsMART stores. Doggie Daycamp is currently a concept test in one store in California.

The company will continue to expand in the key markets of the Northeast and California. Fifteen new stores opened in the first quarter.

The company is expanding in the premium dog food sector, announcing that it offers Hill's Science Diet, a popular and pricey food often recommended by vets. Hill's will be sold only in PETsMART's with in-store Banfield Pet Hospitals, which amounts to 450 of the 740 currently open stores.

The fact that pet health trends are following human ones was mentioned on the conference call.

The PetPerks programs seems to be picking up steam, with 8 million customers worth of data to run through the pricing optimization software.

Capitalizing simultaneously on the strengths, both short and long-term, of pet health, premium dog food, and pet services trends followed by the pet owner, it seems PETsMART continues to stay ahead of the curve.