Pep Boys 2009 Annual Report Download - page 71

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• travel patterns—as changes in travel patterns may cause consumers to rely more heavily on mass
transportation.
Economic factors affecting consumer spending habits may continue, resulting in a decline in revenues
and may negatively impact our business.
Many economic and other factors outside our control, including consumer confidence, consumer
spending levels, employment levels, consumer debt levels and inflation, as well as the availability of
consumer credit, affect consumer spending habits. A significant deterioration in the global financial
markets and economic environment, recessions or an uncertain economic outlook could adversely affect
consumer spending habits and can result in lower levels of economic activity. The domestic and
international political situation also affects consumer confidence. Any of these events and factors could
cause consumers to curtail spending, especially with respect to our more discretionary merchandise
offerings, such as automotive accessories, tools and personal transportation products.
During fiscal 2009, there was significant deterioration in the global financial markets and economic
environment, which negatively impacted consumer spending and our revenues. If these adverse trends
in economic conditions continue or worsen, or if our efforts to counteract the impacts of these trends
are not sufficiently effective, our revenues would continue to decline, negatively affecting our results of
operations.
Consolidation among our competitors may negatively impact our business.
Our industry has experienced consolidation over time. If this trend continues or if they are able to
achieve efficiencies in their mergers, the Company may face greater competitive pressures in the
market in which they operate.
ITEM 1B UNRESOLVED STAFF COMMENTS
None.
ITEM 2 PROPERTIES
The Company owns its five-story, approximately 300,000 square foot corporate headquarters in
Philadelphia, Pennsylvania and a 60,000 square foot structure in Los Angeles, California. The Company
also owns the following administrative regional offices—approximately 4,000 square feet of space in
each of Melrose Park, Illinois and Bayamon, Puerto Rico. The Company leases administrative regional
offices of approximately 1,700 square feet in Whitemarsh, Maryland and approximately 4,000 square
feet in Carrollton, Texas.
Of the 587 store locations operated by the Company at January 30, 2010, 231 are owned and 356
are leased. As of January 30, 2010, 126 of the 231 stores owned by the Company are currently used as
collateral under our Senior Secured Term Loan, due October 2013.
13