Petsmart 2003 Annual Report Download - page 24

business. We regard our intellectual property as having signiÑcant value and as important components in our
merchandising and marketing strategies.
Employees
As of February 1, 2004, we employed approximately 26,500 associates, approximately 13,400 of whom were
employed full time. We are not subject to any collective bargaining agreements and have not experienced any work
stoppages. We consider our relationship with our associates to be good. Increases in the federal minimum wage in
recent years have not had a material eÅect on our business.
Financial Information by Business Segment and Geographic Data
As of February 1, 2004, we had three operating segments: PETsMART North America, which included all
retail stores, PETsMART Direct, which included our equine catalog and equine internet operations; and
PETsMART.com, which included our pet catalog and pet internet operations. We have evaluated our segment
reporting requirements under Statement of Financial Accounting Standards, or SFAS, No. 131, ""Disclosures about
Segments of an Enterprise and Related Information,'' and have determined that the PETsMART Direct and
PETsMART.com operating segments do not meet the quantitative thresholds for disclosure as reportable operating
segments. No one region or country other than the United States accounted for 10% or more of revenues in 2003.
Net sales in the United States were approximately $2,920.3 million, $2,632.5 million, and $2,438.2 million for
2003, 2002, and 2001, respectively. Net sales, denominated in US dollars, in Canada were approximately
$75.8 million, $62.7 million, and $62.8 million for 2003, 2002, and 2001, respectively. The information for long-lived
assets and deferred tax assets is incorporated by reference to the Notes to Consolidated Financial Statements
attached as Exhibit F.
Available Information
We make available free of charge through our internet web-site (www.petsmart.com) our Annual Report on
Form 10-K, our Quarterly Reports on Form 10-Q, our current reports on Form 8-K, and amendments to those
reports, as soon as reasonably practicable after we electronically Ñle such material, or furnish it to the Securities and
Exchange Commission.
Business Risks
In the normal course of business, our Ñnancial position is routinely subjected to a variety of risks, including
market risks associated with store expansion, investments in information systems, international expansion, vendor
reliability, competitive forces, and government regulatory actions. You should carefully consider the risks and
uncertainties described below in connection with those also discussed in Our Stores, Distribution, Information
Systems, Competition, and Government Regulation sections of this Annual Report on Form 10-K. Our actual results
could diÅer materially from projected results due to some or all of the factors discussed below.
If we are unable to successfully open new stores or increase sales at our reformatted stores, our results of
operations would be harmed.
Our continued revenue growth depends to a degree on our ability to increase sales at our reformatted stores. We
completed this reformatting program in 2003. There can be no assurance that our reformatted stores will meet
forecasted levels of sales and proÑtability.
In addition, we expect to open approximately 90 net new stores in 2004. Our ability to open additional stores is
dependent on various factors including:
‚ Identifying store sites that oÅer attractive returns on our investment;
‚ Competition for those sites;
‚ Successfully negotiating with landlords;
‚ Timely construction of such stores; and
‚ Our ability to attract and retain qualiÑed store personnel.
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