Rite Aid Sales Rise More Than Expected in November

By Tess Stynes 

Rite Aid Corp. said sales at stores at stores open at least a year rose 5.1% during November from a year earlier, exceeding expectations, led by growth in the pharmacy section.

Shares rose 2.4% to $5.59 in recent premarket trading.

For the quarter ended Nov. 29, the company reported total drugstore sales rose 5.1% to $6.65 billion. Sales at stores open at least a year improved 5.4%, including growth of 1.6% in the front of the store and an increase of 7.2% in the pharmacy business.

Analysts polled by Thomson Reuters expected November same-store sales growth of 4.1% for November and revenue of $6.77 billion for the quarter.

Rite Aid, the nation's No. 3 drugstore chain by sales behind Walgreen Co. and CVS Caremark Corp., operates roughly 4,570 stores. Like other drugstores chains, Rite Aid has adjusted its offerings in an effort to broaden its business model as the pharmacy and drugstore industry expands into the health and wellness sector.

During November, pharmacy sales at stores open at least a year rose 7.1%, topping analysts' expectations for 5.3% growth, including a negative impact of 2.32 percentage points from new generic-drug introductions. Prescription volume grew 4.2%.

In the front of the store, same-store sales edged up 0.7% during the month, below analysts' estimates for an increase of 1.5%.

Prescription sales represented nearly 70% of total sales in both periods.

In September, Rite Aid reported that its quarterly earnings more than tripled for the quarter ended August, beating expectations, but lowered its outlook for its business year on expectations pharmacy margins would weaken in the second half.

Rite Aid plans to release its financial results for the quarter ended November on Dec. 18.

Write to Tess Stynes at [e-mail]

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