Shares of Rite Aid Corp. (RAD) fell over 10% in trading Thursday, Sept. 28, as the drugstore chain reported weak same-store sales and missed revenue expectations for the fiscal second quarter ended Aug. 30.
Revenue slipped 4.4% to $7.7 billion, falling short of FactSet analysts' $7.8 billion estimate. Same-store sales slid 3.4%, marking the fifth consecutive quarterly decline.
Earnings increased to 16 cents per share, or $170.7 million, up from one cent per share in the same period last year. The boost in profit came from a $325 million termination fee in June from Walgreens Boots Alliance (WBA) following a failed deal between the two chains.
Adjusting for the one-time termination fee, Rite Aid reported a loss of one cent per diluted share, down from earnings of 3 cents per diluted share last year. The one-cent loss was in line with analyst expectations.
The Walgreens-Rite Aid tie-in was nixed by antitrust regulators earlier this summer. The two will instead strike a new deal under which Walgreens will purchase no fewer than 2,000 Rite Aid stores for $4.4 billion.
"Securing regulatory clearance for the amended asset sale agreement with Walgreens Boots Alliance gives us a clear path forward to realize the benefits of the transaction and implement our plans to deliver improved results," CEO John Standley said.
Rite Aid stock has crumbled over 75% since the start of the year.
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