Rite Aid has never really been able to regain its former glory. Both Walgreen Co. (NYSE: WAG) and CVS Caremark Corporation (NYSE: CVS) have been formidable competitors, while Wal-Mart Stores Inc. (NYSE: WMT) has been a more than formidable check and balance to the entire drug store sector.
The troubled retail drugstore reported a loss at -$0.09 EPS on more than a 2% revenue decline to $6.2 billion. Thomson Reuters had estimates of -$0.13 EPS and $6.2 billion in revenues.
Looking ahead, Rite Aid lowered guidance. It now sees -$0.60 to -$0.74 EPS for 2011 versus a Thomson Reuters figure of -$0.57 EPS and versus a prior target of roughly -$0.46 to -$0.67 EPS. It also sees 2011 revenues of $25.0 to $25.2 billion versus $25.19 billion from Thomson Reuters and versus a prior target of $25.0 to $25.4 billion.
While total sales were down more than 2% in the last quarter, Rite Aid’s same-store sales came to a drop of 1.3% from a year earlier. The same-store pharmacy sales were actually down 1.9%, which implies that those getting prescriptions are heading elsewhere or are opting for cheaper drugs via generics. Prescriptions filled in those same store sales also fell 1.7%.
The company maintained that this was under expectations but it also has blamed a weak cold and flu season.
The only good takeaway here is that the front-end merchandising sold better than its pharmacy operations. That hardly feels like a turnaround but it will just have to suffice for now.
Rite Aid shares are down 2.4% at $0.89 in the pre-market trading versus a $0.91 close and versus a 52-week trading range of $0.86 to $1.77. Some turnaround stocks just never manage to turn around.
JON C. OGG
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