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Rite Aid Turns Profit, Grows General Merchandise Sales

For its fiscal third quarter ended December 1, Rite Aid Corp. has reported revenues of $6.2 billion versus $6.3 billion in the prior-year period. Net income was $61.9 million, or seven cents per diluted share, versus a net loss of $52 million, or six cents per diluted share, in last year’s quarter.

Earnings bested a Thomson Reuters average analyst estimate of three cents per diluted share.

Third quarter comparable store sales decreased 1.5% over the prior-year period. The figure included a 1.1% increase in front-end sales, those that include housewares and other general merchandise results, offset by a 2.7% decrease in pharmacy sales. Pharmacy sales included a 924 basis point negative impact from new generic drug introductions, Rite Aid stated.

“We have reached a significant milestone in our turnaround efforts by returning to profitability,” said Rite Aid chairman, president and CEO John Standley. “We have now increased adjusted EBITDA and same-store prescription counts for eight consecutive quarters. Our third quarter performance is the result of our entire team’s continued efforts to fundamentally improve our business.” 

Adjusted EBITDA was $295.3 million, or 4.7% of revenues, the company related, compared with $221.5 million, or 3.5% of revenues, in the 2011 third quarter.

Standley added, “Our record adjusted EBITDA was driven by strong prescription count growth, an increase in front-end same store sales and higher pharmacy gross margin resulting from the introduction of new generic medications. While we are pleased with our third quarter results, we remain focused on sustaining our positive momentum and achieving long-term success.”

Rite Aid relocated three stores in the third quarter, remodeled 114 and closed 10 for a total of 4,633.