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Drugstore chain retailer, Rite Aid Corporation’s (RAD - Analyst Report) same-store sales (comps) for the four weeks ended September 29, 2012, slipped 0.7%. The disappointment in September was caused by a decline in pharmacy comps, offset in part by increase in front-end comps and rise in prescription count on a comparable basis.

Pharmacy comps for September declined 2.3%, including a negative impact of around 911 basis points from new generic introductions. On the other hand, front-end same-store sales for the month registered an improvement of 2.8%, while prescription count at comparable stores rose 4.4%.

Rite Aid reported total drugstore sales of $1.899 billion in September, with prescription sales accounting for 67.8% of drugstore sales and third-party prescription sales making up for 96.5% of pharmacy sales. The company’s September sales represent a 1.5% dip from the year-ago level of $1.927 billion.

Year-to-date, the company’s comps grew 0.9%, while net sales rose 0.2% year over year to $14.545 billion. The upside in comps mainly came from a 2.1% rise in front-end comps, 0.4% jump in pharmacy comps and a 3.6% increase in prescription count at comparable stores.

Total sales for the period comprised of 67.9% contribution from prescription sales. Additionally, third party prescription sales represented 96.6% of pharmacy sales.

Headquartered in Camp Hill, Pennsylvania, Rite Aid is the third-largest retail drugstore in the U.S. on the basis of revenues and number of stores. The company operates in 31 states across the country and in the District of Columbia. As of September 29, 2012, the company operated 4,639 stores as compared with 4,694 stores in the comparable period last year.

Rite Aid, which competes with CVS Caremark Corporation (CVS - Analyst Report) and Walgreen Co. (WAG - Analyst Report), currently, has a Zacks #3 Rank, implying a short-term Hold rating. Moreover, we are maintaining a long-term Neutral recommendation on the stock.

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