Rite Aid Corp. shares fell more than 13 percent Thursday after the company reported a wider-than-expected loss during the second quarter on a 2.5 percent drop in revenues.
In the three months ended Aug. 28, the Camp Hill, Pa.-based drugstore chain realized a net loss of $197 million, or 23 cents a diluted share, compared to a loss of $116 million, or 14 cents, a year ago. Wall Street analysts were expecting a loss of 17 cents a share.
The dip in sales brought the top line down to $6.16 billion for the quarter, versus $6.32 billion last year. In addition to this decline, which the firm attributed to store closings and a decline in same-store sales, startup costs related to investments in long-term growth initiatives and a charge related to the company’s refinancing activities weighed on results, according to the firm.
However, president and chief executive John Standley stated, “We started to see some positive trends in our business during the second quarter. Sales in our core drugstore categories have started to strengthen, and our gross margin trends are showing improvement.”
Same-store sales for the quarter decreased 1.5 percent from the prior year and included a 0.9 percent decrease in front-end sales and a 1.8 percent decrease in pharmacy sales, which accounted for 68.1 percent of total drugstore sales, the firm noted.
The retailer lowered its sales guidance for fiscal 2011, setting sales expectations at between $25 billion and $25.4 billion, with same-store sales ranging from a decrease of 1.5 percent to flat.