Fred's Maintains Its Full-year Profit Forecast

MEMPHIS, Tenn. (AP) — Discount retailer and pharmacy chain Fred's Inc. reaffirmed its full-year earnings outlook Thursday after reporting its first-quarter profit rose 18 percent to meet analysts' estimates.

The company still expects full-year earnings in a range of 73 cents to 80 cents per share.

Analysts predict net income of 77 cents per share, according to a Thomson Reuters poll. Analysts' estimates typically exclude one-time items.

For the second-quarter, Fred's anticipates profit of 12 cents to 15 cents per share. Sales are forecast to decline 1 percent to 3 percent due store closing efforts, which implies revenue of $433.8 million to $442.8 million. The company had sales of $447.1 million a year ago.

Analysts expect quarterly profit of 12 cents per share on sales of $439.8 million.

Fred's predicts second-quarter same-store sales in a range of flat to up 2 percent.

Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measures growth at existing stores rather than newly opened ones.

Fred's ran 666 discount general merchandise stores, including 24 franchised Fred's stores at year-end.