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Rite Aid narrows Q1 loss, but lowers 2010 forecast


Camp Hill, Pa. Rite Aid Corp. said Wednesday it narrowed its fiscal first-quarter loss by closing stores and trimming costs, but it expects a greater deficit for the year due to refinancing expenses.

The company lost $98.4 million, compared with $156.6 million a year ago. Revenue fell 1% to $6.53 billion, from $6.61 billion due to 86 store closings. Same-store sales grew 0.6%.

Rite Aid is refinancing loans that come due in September. The company said it completed refinancing of a $145 million term loan, and has partly completed refinancing for its $1.75 billion revolving credit facility. It now has a $525 million term loan due in June 2015, and $410 million in senior notes due June 2016, and says it secured commitments for $960 million of a proposed $1 billion revolving credit facility due September 2012.

Due to the refinancing, Rite Aid said its interest costs will increase by $55 million for the year. That will result in an annual loss of $265 million to $490 million. The company previously expected a smaller loss of $210 million to $435 million, although its earlier estimate did not include interest expenses.

Rite Aid still expects $26.3 billion to $26.7 billion in revenue in fiscal 2010, and still says same-store sales will rise 0.5% to 2.5%.

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