Drugstore chain retailer, Rite Aid Corporation (RAD - Free Report) reported a same-store sales (comps) increase of 0.4% for the five-week period ended September 1, 2012. The improvement was driven by positive front-end and prescription count comps for the month, offset by decline in pharmacy comps.
Front-end same-store sales for August registered a marginal improvement of 2.4%, while pharmacy comps declined 0.6%. Prescription count at comparable stores witnessed an upside of 4.5%. Pharmacy comps for August included a negative impact of around 819 basis points from new generic introductions.
Rite Aid reported total drugstore sales of $2.406 billion in August, with prescription sales accounting for 67.6% of drugstore sales and third-party prescription sales making up for 96.4% of pharmacy sales. The company’s August sales represent a 0.3% dip from the year-ago level of $2.414 billion.
For the fiscal second quarter ended September 1, 2012, Rite Aid’s comps remain flat compared to last year, with front-end comps increasing 1.4%, offset by a 0.7% decline in pharmacy comps. Prescription count at comparable stores grew 4.0% during the quarter.
Total drugstore sales for the quarter came in at $6.208 billion, sliding down 0.7% from $6.251 billion in the prior-year quarter. Quarterly sales included a 67.5% contribution from prescription sales, while third-party prescription sales accounted for 96.5% of pharmacy sales.
Year-to-date, the company’s comps grew 1.2%, while net sales rose 0.5% year over year to $12.646 billion. The upside in comps mainly came from a 2.0% rise in front-end comps, 0.8% jump in pharmacy comps and a 3.5% increase in prescription count at comparable stores. Total sales for the period comprised of 68.0% 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 1, 2012, the company operated 4,643 stores as compared with 4,697 stores in the same period last year.
Rite Aid, which competes with CVS Caremark Corporation (CVS - Free Report) and Walgreen Co. , currently, has a Zacks #3 Rank, implying a short-term Hold rating. Moreover, we are maintaining a long-term Neutral recommendation on the stock.