The acquisition from Canada's Jean Coutu Group remains under review by the Federal Trade Commission. The impact of the deal on Rite Aid's business remains unknown, Mary Sammons, the company's chief executive, said in a conference call with analysts.
"All of the networks are based upon individual contracts with payers and changes are unlikely to occur in the short-term since most are at least three-year agreements," she says.
The nation's third largest pharmacy chain, which operates 3,322 stores in 27 states, has been struggling with losses the past two years as it faced tough competition from other drug store chains and major retailers.
For the three months ended Dec. 2, Rite Aid said stronger pharmacy sales helped boost third-quarter revenue 4%, but losses still remained steep at $6.82 million, or one cent a share, based on revenue of $4.32 billion. Third-quarter sales at stores open at least a year were also up by 3.4% due to a 4.3%-increase in pharmacy sales, the company says.
Participants in Medicare's new prescription drug benefit helped prescription sales at comparative stores rise 2.3% during the quarter.For the first nine months of the year, the firm reported a loss of $11.8 million, or 2.2 cents per share, on revenue of $12.9 billion. Rite Aid lost 4.3 million, or one cent per share, on revenue of $12.5 billion in the first nine months of 2005.
For the full fiscal year, which ends March 3, Rite Aid confirmed its previous guidance, saying it expects between $5 million in losses or $40 million in gains based on revenue of $17.4 billion to $17.65 billion. Comparative store sales are expected to improve over last year by 2% to 4%, the company says.
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