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Rite Aid

(RAD) - Get Report

could be looking into rolling out smaller stores that focus on groceries.

On its third-quarter conference call with analysts, the drugstore chain said it has added grocery sections to 10 stores in South Carolina through a partnership with




Rite Aid's CEO John Standley said on the call that front-end sales at these stores have approximately doubled on average. He even noted that these stores could be used as a model to enter more urban markets.


It's exciting to take a store that was a low volume store that was doing $20,000 a week on the front end and make it do $60,000 or $70,000," he said during the call. "That's a pretty good answer for us, and we have some real estate that fit this demographic very nicely."

These statements come on the heels of Rite Aid reporting yet another loss in its third quarter and cutting its full-year outlook.

The company now expects a loss of 60 cents to 74 cents a share in 2010, and also said that fourth-quarter same-store sales will miss estimates. Wall Street is predicting a much smaller loss of 57 cents a share for the year.

In its third quarter, Rite Aid narrowed its loss to $79.1 million, or 9 cents a share, compared with a loss of $83.9 million, or 10 cents, in the year-ago period. Analysts were calling for a bigger loss of 13 cents a share.

Sales declined to $6.2 billion from $6.35 billion, while same-store sales sank 1.3%.

--Written by Jeanine Poggi in New York.

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