UPDATE 2-PetMed posts Q4 earnings above Street view, shares rise

(Adds conference call details, analysts' comments, share movement)

By Swagata Gupta

BANGALORE, May 12 (Reuters) - Pet pharmacy PetMed Express Inc (PETS.O: Quote, Profile, Research) reported fourth-quarter earnings above market expectations, helped by growth in reorder sales and tighter cost controls, sending its shares up as much as 7 percent.

The company began to cut its advertising spending last year focusing more on customer service and offering more competitive prices to consumers as higher costs were hurting results.

For the quarter, net income was $4.9 million, or 20 cents a share, compared with $3.6 million, or 15 cents a share, a year earlier.

Net sales rose 11 percent to $40.4 million.

Advertising expense was flat at about $4.5 million. Total operating expenses stood at $9.6 million compared with $9.1 million a year earlier.

The company had a better gross margin due to improved product mix and a good control over its operating cost, said Wedbush Morgan Securities analyst Edward Woo, who has a "hold" rating on the stock.

Analysts had expected the company to earn 18 cents a share, excluding exceptional items, on revenue of $41.7 million, according to Reuters Estimates.