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Rite Aid Posts Flat Sales, Misses Forecast

The Associated Press

Rite Aid said traditional holiday sales were not as strong as they were last year because of a later Thanksgiving, while sales of recently introduced generic drugs hurt its pharmacy sales.

The company's total sales decreased 0.9% in the fiscal third quarter, to $6.44 billion from $6.5 billion. Analysts had expected $6.49 billion, according to Thomson Reuters. The period ended Nov. 29.

In November, Rite Aid said its same-store sales, or sales open at least one year, were flat compared with the same period in 2007. Same-store pharmacy sales edged up 0.2%, as Brooks Eckerd pharmacies continued to struggle, and front-end, or non-pharmacy, sales fell 0.4%.

Analysts predicted same-store sales would grow 2.5% for the month, with pharmacy sales rising 2% and front-end stores up 3.6%.

Same-store sales at Brooks Eckerd stores declined 2.1%, with pharmacy sales down 3% and front-end sales rising 0.8%. Rite Aid bought the Brooks Eckerd stores in June 2007. While same-store sales at those locations have been in decline, they were steadying in recent months: total Brooks Eckerd same-store sales grew in October, with pharmacy sales only down slightly and front-end sales showing strong improvement.

Those trends reversed in November, which for retailers was the last five weeks of the quarter.

Excluding Brooks Eckerd stores, November same-store sales increased 1%, as pharmacy sales grew 2.1% and front-end sales dipped 0.8%.

Total sales fell 2% in November, to $2.48 billion from $2.53 billion a year ago.

In the third quarter, Rite Aid's same-store sales improved 1.4%, with pharmacy sales up 1% and front-end sales 2.3% better. That included a 1-percent decrease at Brooks Eckerd stores, where pharmacy sales slid 2.6% and front-end sales rose 3.7%.

Non-Brooks Eckerd same-store sales increased 2.6%, as pharmacy sales increased 3% and front-end sales grew 1.9%.

Shares of the company fell 4 cents, or 8.5%, to 43 cents in morning trading.