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PETMED EXPRESS, INC.

QUARTER ENDED SEPTEMBER 30, 2006

CONFERENCE CALL TRANSCRIPT

OCTOBER 23, 2006 AT 8:30 A.M. EDT

Coordinator: Welcome to the PetMed Express Inc. doing

business as 1-800-PetMeds conference call, to

review the financial results for the second

fiscal quarter ended on September 30, 2006. At

the request of the company, this conference call

is being recorded. Founded in 1996, 1-800-

PetMeds is America's Largest Pet Pharmacy,

delivering prescription and non-prescription pet

medications and other health products for dogs,

cats and horses direct to the consumer. 1-800-

PetMeds markets its products through national

television, on-line, direct mail and print

advertising campaigns, which direct consumers to

order by phone or on the Internet, and aim to

increase the recognition of the "1-800-PetMeds"

brand name. 1-800-PetMeds provides an

attractive alternative for obtaining pet

medications in terms of convenience, price, ease

of ordering, and rapid home delivery. At this

time I would now like to turn the call over to

the company's Chief Financial Officer, Mr. Bruce

Bruce Rosenbloom: Thank you. I'd like to welcome everybody here

today. Before I turn the call over to Mendo

Akdag, our Chief Executive Officer and President,

I would like to remind everyone that the first

portion of this conference call will be listen-

only, until the question and answer session,

which will be later in the call.

Also certain information that will be included

in this press conference may include forward-

looking statements within the meaning of the

Private Securities Litigation Reform Act of

1995, or the Securities and Exchange Commission

that may involve a number of risks and

These statements are based on our beliefs, as

well as assumptions we have used based upon

information currently available to us. Because

these statements reflect our current views

concerning future events, these statements

involve risks, uncertainties and assumptions.

Actual future results may vary significantly

based on a number of factors that may cause the

actual results or events to be materially

different from future results, performance, or

achievements expressed or implied by these

We have identified various risk factors

associated with our operations in our most

recent annual report and other filings of the

Securities and Exchange Commission.

Now let me introduce today's speaker, Mendo

Akdag, the Chief Executive Officer and President

of 1-800-PetMeds. Mendo.

Mendo Akdag: Thank you, Bruce. Welcome everyone, and thank

you for joining us. Today we'll review the

highlights of our financial results. We'll

compare our second fiscal quarter and six months

ended on September 30, 2006, to last year's

quarter and six months ended on September 30,

For the second fiscal quarter ended on September

30, 2006, our sales were $43.8 million compared

to sales of $38.7 million for the same period

the prior year - an increase of 13%.

For the six months ended on September 30, 2006,

sales were $94.5 million compared to sales of

$82.3 million for the six months the prior year

- an increase of 15%. The increase was primarily

due to increased retail reorders, offset by

decreased wholesale sales.

For the second fiscal quarter, net income was

$3.3 million, or 14 cents diluted per share,

compared to $2.7 million or 11 cents diluted per

share for the same quarter the prior year - an

increase to net income of 22%.

For the six months, net income was $8.1 million,

or 33 cents diluted per share, compared to $6.3

million, or 26 cents diluted per share a year

ago - an increase to net income of 29%.

Retail reorder sales increased by 23% to $28.1

million for the quarter, compared to retail

reorder sales of $22.9 million for the same

quarter the prior year. For the six months, the

reorder sales increased by 28% to $62 million,

compared to $48.6 million for the same period

Retail new order sales increased by 6% to $15.5

million for the quarter, compared to $14.7

million for the same period the prior year. For

the six months, the new order sales increased by

3% to $32 million, compared to $31.1 million for

the same period last year.

The slowdown in retail new order sales growth

may be attributable to increased advertising

costs to acquire new customers, and increased

Wholesale sales were approximately $200,000 for

the quarter compared to $1.1 million for the

same quarter the prior year. For the six months,