Sales at Jean Coutu U.S. ops fall 1.5%

LONGUEUIL, Quebec The Jean Coutu Group today reported revenues for its U.S. operations of $2.4 billion for the fourth quarter ended June 4, a decrease of 1.4% from the fourth quarter ended May 27, 2006. U.S. revenues for fiscal 2007 increased to $9.8 billion, up $278.1 million or 2.9% from fiscal 2006.

The company reported that U.S. corporate pharmacy network retail sales decreased 1%, pharmacy sales decreased 1.3% and front-end sales decreased 0.2% in terms of comparable-stores.

According to the company, front-end sales growth was negatively impacted by the declining availability of certain private label and other products prior to the closing of the Rite Aid transaction. The network posted a 1.5% decrease in retail sales for the quarter compared with last year. Retail sales for the period were $2.4 billion.

On June 4, the company completed the sale of its United States network to Rite Aid. The gain on sale of U.S. operations amounted to $139.3 million ($76.6 million after-tax), and the company recorded restructuring charges related to this transaction of $54.3 million ($31.6 million after-tax) in fiscal 2007.

The loss on early debt retirement when debt was repaid using cash consideration from the Rite Aid transaction amounted to $168.3 million ($117.5 million after-tax).

"We are satisfied with our fourth quarter and fiscal 2007 results in what was a transformational year for the company," said Jean Coutu, president and ceo. "We continued to improve sales growth in our Canadian network and the U.S. network delivered acceptable results despite challenges prior to the closing of the Rite Aid transaction. We will continue to build on our position as one of the leaders in the Canadian drug store market, and with our leading ownership position in the expanded Rite Aid, we are able to better participate in the growing U.S. drug store industry."