Rite Aid Corp. (RAD: Quote) on Thursday reported a narrower loss for its first quarter, benefited by higher comparable store sales. The retail drugstore chain operator also trimmed the higher end of its loss forecast for fiscal 2013, but lowered sales view due to an increase in the projected negative impact of new generic introductions.
Chairman, President and CEO John Standley stated that the company's "turnaround efforts continue to be successful as demonstrated by sixth consecutive quarter of increased same store sales and Adjusted EBITDA."
For the first quarter, Rite Aid's net loss attributable to common shareholders was $30.69 million or $0.03 per share, compared to loss of $65.53 million or $0.07 per share last year. The latest results included $0.02 per share loss on debt modification and $0.02 per share charge related to a proposed legal settlement.
On average, six analysts polled by Thomson Reuters expected the company to report a loss of $0.03 per share for the quarter. Analysts' estimates typically exclude special items.
Quarterly revenues rose 1.2 percent to $6.47 billion, beating Wall Street analysts' consensus of $6.43 billion. An increase in same store sales were partially offset by store closings, the company said.
Same store sales, as announced on June 7, increased 2.5 percent. Front end sales grew 2.7 percent and pharmacy sales, despite a 326 basis point negative impact from new generic introductions, increased 2.4 percent.
Rite Aid, the industry's weakest player, has been gaining ground recently due to the contract termination between Walgreen Co. (WAG) and Express Scripts, Inc. (ESRX).
The company today noted that the number of prescriptions filled in same stores increased 3 percent, which includes the benefit of additional prescriptions resulting from the Walgreens/Express Scripts dispute.
Looking ahead to fiscal 2013, Rite Aid now projects net loss between $103 million and $248 million or a loss per share of $0.13 to $0.29. The company's previous forecast was net loss between $103 million and $267 million or a loss per share of $0.13 to $0.31.
The company now expects sales to be between $25.3 billion and $25.7 billion and same store sales to range from a decrease of 0.5 percent to an increase of 1 percent over fiscal 2012.
This is in comparison to previous estimate of sales between $25.4 billion and $25.8 billion with same-stores sales expected to range from flat to an increase of 1.5 percent.
According to the company, the reduction in sales forecast is driven by an increase in the projected negative impact of new generic introductions on pharmacy same store sales from 520 to 600 basis points.
Analysts expect the company to report a loss of $0.20 per share on revenues of $25.53 billion for the year.
Rite Aid shares closed Wednesday's trading at $1.17, down $0.03 or 2.50 percent. In pre-market activity, shares increased $0.05 or 4.27 percent and currently at $1.22.
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by RTT Staff Writer
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