Leading drugstore chain operator Rite Aid Corp. (RAD) reported a minimal decline of 0.1% in same-store sales for the four weeks ended March 26, 2011.
Results moderated from an increase of 1.0% in February 2011.
For the month of March, front-end same-store sales decreased 1.8%. The sales were negatively impacted by a shift in Easter Holiday.
Pharmacy same-store sales in March improved 0.8% despite a 176 basis point headwind from new generic introductions. Results slightly slipped from a 0.9% increase in February 2011. Prescriptions filled at comparable stores increased 0.6%.
Total drugstore sales decreased 0.9% year over year to $1.949 billion for March 2011. In the four-week period, prescription revenue contributed 69.4% of drugstore sales while third party prescription revenue accounted for 96.5% of pharmacy sales.
Rite Aid posted a third quarter loss per share of 9 cents, beating the Zacks Consensus Estimate of a loss of 13 cents.
Rite Aid expects fiscal 2011 revenue between $25.0 billion and $25.2 billion based on same-store sales decline of 1.5% to 0.9%. The company expects net loss in the range of $655 million to $525 million (or 74 cents to 60 cents per share).
The Zacks Consensus Estimate for fourth-quarter 2011 is a loss of 21 cents per share. For fiscal years 2011 and 2012, the Zacks Consensus Estimates are a respective loss of 63 cents per share and 49 cents per share.
The company competes with, among others, retail drugstore chains, independently owned drugstores, supermarkets, mass merchandisers, discount stores, dollar stores, and mail order pharmacies. Competitive pressure in the industry is unlikely to subside with continued consolidation, new store openings, and increased mandatory mail orders.
The company operates in a highly fragmented specialty retail sector and faces intense competition from CVS Caremark Corporation (CVS), Walgreen Co. (WAG) and Wal-Mart Stores Inc. (WMT).
Headquartered in Camp Hill, Pennsylvania, Rite Aid Corporation, through its subsidiaries, operates retail drugstores in the United States.
CVS CAREMARK CP (CVS): Free Stock Analysis Report
RITE AID CORP (RAD): Free Stock Analysis Report
WALGREEN CO (WAG): Free Stock Analysis Report
WAL-MART STORES (WMT): Free Stock Analysis Report
Zacks Investment Research
