Petco Health and Wellness Company (WOOF) investor relations material

Transformation strategy and execution

• Transformation is structured in three phases: strengthening retail fundamentals, execution and implementation, and future growth planning.

• Phase one focused on identifying opportunities and rebuilding the leadership team, completed by early 2024.

• Phase two centers on improving EBITDA, operational execution, and shifting company culture to a more proactive, cost-saving mindset.

• Phase three, targeted for 2026, will focus on four pillars: store experience, merchandise differentiation, scaling services, and omnichannel growth.

• Growth initiatives are being tested in select stores before broader rollout, emphasizing a data-driven, test-and-learn approach.

Services, omnichannel, and competitive differentiation

• Services, especially grooming and veterinary, are seen as key differentiators and traffic drivers, with ongoing optimization and digital enhancements.

• Omnichannel strategy leverages both physical stores and digital tools, with a focus on convenience, speed, and seamless customer experience.

• Store network is used for market fulfillment, improving speed and efficiency for online orders.

• Competition is addressed through differentiation in services, omnichannel capabilities, and a focus on value and speed.

Store fleet, productivity, and cost management

• Store performance is regularly evaluated based on profitability, market relevance, and lease renewals, with flexibility due to many leases expiring soon.

• About 25 stores were closed last year, with a similar number expected this year; growth in store count anticipated by 2027.

• Store productivity and four-wall profitability are improving through gross margin expansion and operational enhancements.

• Store size is considered optimal at 13,000 square feet, with ongoing initiatives to improve sales per square foot.