Fred’s reported a soft first quarter, although the retailer saw some improvement in its April results.
In the first quarter, Fred’s total sales decreased 3% to $532.9 million compared to the same period last year as comparable store sales decreased 1.2%. Comparable store sales included a negative 1.4% impact resulting from the sale of low-productive discontinued inventory, the company said.
Fred’s also stated that it closed 39 underperforming stores in the quarter.
The retailer’s April sales slipped 3% year-over-year to $159.1 million while comps increased 1.2%. Fred’s maintained that, although April comps included a negative 1% hit from sale of low productive discontinued inventory versus last year’s month, the metric gained from double digit growth for Easter seasonal categories resulting from the shift of the holiday date compared with 2016.
Michael Bloom, Fred’s CEO, said, “The Fred’s Pharmacy health care transformation is well under way as we continue to experience sequential sales improvement. The initiatives we began implementing in 2016 and early 2017 are taking hold and laying the foundation for continued success. We have created substantial momentum in our pharmacy businesses as we make the strategic shift to focus on health care, with specialty pharmacy sales growing double digits and driving our consolidated pharmacy comparable sales. In retail pharmacy, we are seeing sequential growth in adjusted script comps, while our generic dispensing rate has increased as we continue our focus on more profitable scripts. We remain confident in the Fred’s Pharmacy plan to improve our performance, and are already realizing the benefits of our comprehensive strategy and talented management team.”