Rite Aid's June comps decrease 1%
CAMP HILL, Pa. — Rite Aid's same-store sales decreased in June, compared with June 2011, due largely to a decrease in pharmacy comps, the retail pharmacy chain said Thursday.
The 1% decrease in overall comps included a 1.6% decrease in pharmacy same-store sales — including a negative effect of 672 basis points from new generic introductions — and a 0.3% increase in front-end same-store sales. Prescription count at comparable stores increased 2.9%.
The results for the month stand in contrast to Rite Aid's strong first-quarter 2012 results, but appear in line with results for the pharmacy retail industry overall and with analyst forecasts. In a report Thursday, Guggenheim Partners analyst John Heinbockel said his firm remained "bullish" about Rite Aid, saying that despite comps' being below the forecasted 1.5% increase, the decrease was due to the hit from generics and the timing of the Fourth of July holiday.
In a report last week, Heinbockel wrote that spending had gone down somewhat in May "with more to go," resulting in a "cautious" outlook on consumer spending due to ongoing pressure on personal incomes from payroll taxes. As a result, he wrote, comps likely would moderate. "We continue to lean in a more defensive direction, preferring investments in the dollar stores and drug retailers, both of which should benefit from superior relative earnings momentum through the balance of 2012 and into 2013," Heinbockel wrote.
Total drug store sales declined as well, to $1.9 billion, compared with nearly $1.6 billion in June 2011.
Comps for the 17-week period that ended June 30 increased 1.7% over the same period last year, including a 2.1% increase in front-end comps and a 1.4% increase in pharmacy comps, as well as a 3% increase in prescription count at comparable stores.
Meanwhile, total drug store sales increased 1%, from $8.28 billion to $8.37 billion.