As Rite Aid prepares for its pending merger with supermarket operator Albertsons, the drug store chain posted a net loss in the first quarter.
Rite Aid recorded a first quarter net loss from continuing operations of $41.7 million, or four cents per diluted share, versus a net loss from continuing operations of $36 million, or three cents per diluted share, in the period in the fiscal year before. Adjusted net loss from continuing operations was $11.5 million, or one cent per diluted share, versus $9.2 million, or one cent per diluted share, in the quarter a year earlier.
Adjusted loss per share from continuing operations narrowly missed an analyst average estimate from Zacks Investment Research of break even.
In the period, Rite Aid posted net revenues of $5.39 billion versus $5.44 billion in the fiscal year previous. Loss from continuing operations was $51.2 million versus $48.2 million in the quarter a year prior.
In the retail pharmacy segment, revenues from continuing operations were $3.9 billion versus $3.97 billion in the year-previous period. Comparable store sales in the segment declined by 0.7% year over year, with front-end sales, including general merchandise such as household goods, down 1.8%.
John Standley, Rite Aid chairman and CEO, said, “As we continue to focus on taking care of our customers and executing our stand-alone strategy, we have the opportunity to further accelerate our strategy by combining with Albertsons to create a truly differentiated leader in food, health and wellness. This combination will enhance our scale and density to better compete in existing markets, give us access to new markets, significantly improve our omnichannel capabilities and create the opportunity to achieve substantial cost synergies and revenue growth, all of which will strengthen our financial profile and position us to deliver compelling long-term value for customers and shareholders.”
The Albertsons merger is expected to close in the second half of calendar year 2018, subject to the approval of Rite Aid’s shareholders, regulatory approvals, and other customary closing conditions. A special meeting of Rite Aid shareholders is scheduled for August 9.
The company’s president and COO, Kermit Crawford, added, “In the first quarter, we continued making progress in building momentum for key areas of our business, including improvement in pharmacy gross margin and the successful relaunch of our customer loyalty program wellness+ rewards. As we continue to implement our new strategy, we’re excited about the unique opportunity we have to significantly grow our business through a combination with Albertsons, which will give us access to nearly 1,800 additional pharmacy counters, innovative and healthy new own brand products like O Organics and Open Nature as well as provide new levers for growth for our EnvisionRxOptions PBM and RediClinic.”