Rite Aid posts loss on charge
By Varsha Tickoo
BANGALORE (Reuters) - Rite Aid Corp (RAD.N: Quotazione), the third-largest U.S. drugstore chain, posted a fourth-quarter loss due to a big tax charge and merger-related costs, and forecast weak 2009 results, sending its shares down as much as 8 percent.
Excluding the charge and other items, loss for the quarter was narrower than the market estimate -- a respite for Rite Aid that has lately been plagued by weak holiday and slow flu seasons, and cheap generic drugs cutting into sales.
For 2009, Camp Hill, Pennsylvania-based Rite Aid forecast a net loss that was more than double the market estimate, citing slower prescription growth and pharmacy reimbursement rate pressures, amid a challenging economic environment.
Rite Aid stores fill prescriptions, which account for nearly two-thirds of sales, and sell health and beauty aids, convenience foods, greeting cards, among other items.
The retailer posted a net loss of $952.2 million, or $1.20 a share, compared with a profit of $15.1 million, or a penny a share, a year earlier.
The latest quarter's loss includes $1.12 a share related to an income tax charge, and other expenses connected to its acquisition of the Brooks and Eckerd drugstore chains from Canada's Jean Coutu Group (PJC) Inc (PJCa.TO: Quotazione) last year.
Excluding items, Rite Aid would have posted a loss of 6 cents a share for the latest quarter, it said in the call.
Revenue rose 51 percent to $6.82 billion, while same-store sales rose 1.3 percent -- consisting of a 1.4 percent pharmacy same store sales increase and a 1 percent rise in front-end same store sales. Continua...