Rite Aid Q3 revenues up 21.8%, calls special meeting to decide WBA merger
Rite Aid on Thursday reported revenues of $8.2 billion, up 21.8%, for its fiscal third quarter ended Nov. 28, 2015.
The company reported net income of $59.5 million or $0.06 per diluted share, and Adjusted EBITDA of $373.2 million, or 4.6% of revenues.
Rite Aid met Wall Street expectations, as analysts polled by Thomson Reuters had forecast earnings of 6 cents on $8.2 billion in revenue.
"We are pleased with our results for the third quarter, which reflect growth in revenue, same-store sales and Adjusted EBITDA along with positive, significant contributions from our new Pharmacy Services Segment," stated John Standley, Rite Aid chairman and CEO. "We also continued making tremendous progress in strengthening our retail healthcare offering by converting additional stores to our Wellness format."
Retail Pharmacy Segment revenues for the quarter were $6.7 billion and increased 0.8% compared to the prior year period primarily as a result of an increase in same-store sales. Pharmacy Services Segment revenues, which includes its EnvisionRx business, were $1.5 billion.
Same-store drug store sales for the Retail Pharmacy Segment increased 0.9% over the prior year, consisting of a 0.3% increase in front-end sales and a 1.2% increase in pharmacy sales. Pharmacy sales included an approximate 252 basis point negative impact from new generic introductions. The number of prescriptions filled in same stores increased 0.2% over the prior year period. Prescription sales accounted for 69.9% of total drug store sales, and third-party prescription revenue was 97.9% of pharmacy sales.
In the third quarter, the company relocated 5 stores and remodeled 96 stores, bringing the total number of wellness stores chainwide to 1,948. The company also acquired 2 stores and closed 3 stores, resulting in a total store count of 4,560 at the end of the third quarter. The company also opened 5 clinics in the third quarter, bringing the total to 75.
Rite Aid Wednesday evening announced today that it has established a special meeting of its stockholders to take place Feb. 4, 2016, where they will, among other things, consider and vote on a proposal to approve the previously announced merger agreement with Walgreens Boots Alliance.
Rite Aid stockholders as of the close of business on Dec. 18, 2015, will be entitled to receive notice of, and to vote at, the special meeting.
The merger, which is expected to be completed by the second half of calendar 2016, is subject to the approval of the merger agreement by Rite Aid's stockholders and satisfaction of other customary closing conditions.
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