Yesterday, the drugstore chain retailer, Rite Aid Corporation (RAD), reported a decline of 2% in its same-store sales (comps) for the four weeks ended Mar 30, 2013. The decline was primarily due to a fall in pharmacy comps, which was partially offset by an improvement at the company’s front-end stores. Following weak comps results, Rite Aid’s shares fell 1.7% and closed at $1.72.
Pharmacy comps for March declined 4.5% being adversely impacted by about 566 basis points due to the introduction of new generic drugs. Prescription counts at comparable stores inched up 0.3%. Rite Aid’s front-end comps increased 3.8%, primarily driven by a shift in Easter timing.
Rite Aid reported total drugstore sales of $1.939 billion for the month, with prescription sales accounting for 67.6% of drugstore sales and third-party prescription sales making up for 97.0% of pharmacy sales. Rite Aid’s March drugstore sales declined 2.5% from the year-ago level of $1.989 billion.
Recently, one of Rite Aid’s peers, Walgreen Company (WAG) also reported its comps results for the month of March. Contrary to Rite Aid’s performance, Walgreen’s comps for the period inched up 0.7% while total sales increased 2.3% to $6.16 billion.
Rite Aid carrying a Zacks Rank #1 (Strong Buy) is the third largest retail drugstore in the U.S. based on revenues and number of stores. With 4,621 stores, the company operates in 31 states across the country and in the District of Columbia. Rite Aid is expected to release its fourth-quarter and fiscal 2013 results on Apr 11. The analysts polled by Zacks project break-even earnings for the quarter, and a negative 1 cent for the fiscal year.
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