Rite Aid Shares Slip As First-Quarter Earnings Fall Short
Berkeley Lovelace Jr. |
Pharmacy reimbursement rates challenged Rite Aid earnings in the latest quarter, Chairman and CEO John Standley said, in a statement.
Rite Aid shares slipped more than 1 percent Thursday after releasing its first-quarter results.
The drugstore chain reported adjusted quarterly earnings at 1 cent per share, below a Reuters estimate of 5 cents a share. Revenue rose 23 percent to $8.2 billion on a year-over-year basis, but came in below a forecast of $8.26 billion.
Standley said the chain wasn’t able to offset the rate pressure through drug purchasing efficiencies.
“While drug cost reductions will continue to be short of our expectations in the near term, we anticipate improvements over the second half of the fiscal year. As we work to meet this challenge, we remain focused on executing our highly successful sales initiatives like wellness+ with Plenti and the Wellness store program while also making strategic investments for growth and delivering a consistently outstanding customer experience,” he said in a statement.
Shares of Rite Aid jumped last week after a report said there are growing signs that the Federal Trade Commission will approve Walgreens’ $17 billion acquisition of Rite Aid. The two drugstores agreed to merge in February 2015.
Rite Aid said it expects to close deal with Walgreens Boots Alliance in the second half of this year.
Rite Aid’s stock has remained steady this year, dipping about 1 percent.
For more information: cnbc.com/rite-aid-shares-slip-as-first-quarter-earnings-fall-short
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Rite Aid Shares Slip As First-Quarter Earnings Fall Short
Berkeley Lovelace Jr. | @Blovelace_Jr
Rite Aid shares slipped more than 1 percent Thursday after releasing its first-quarter results.
The drugstore chain reported adjusted quarterly earnings at 1 cent per share, below a Reuters estimate of 5 cents a share. Revenue rose 23 percent to $8.2 billion on a year-over-year basis, but came in below a forecast of $8.26 billion.
Standley said the chain wasn’t able to offset the rate pressure through drug purchasing efficiencies.
“While drug cost reductions will continue to be short of our expectations in the near term, we anticipate improvements over the second half of the fiscal year. As we work to meet this challenge, we remain focused on executing our highly successful sales initiatives like wellness+ with Plenti and the Wellness store program while also making strategic investments for growth and delivering a consistently outstanding customer experience,” he said in a statement.
Rite Aid said it expects to close deal with Walgreens Boots Alliance in the second half of this year.
Rite Aid’s stock has remained steady this year, dipping about 1 percent.
For more information: cnbc.com/rite-aid-shares-slip-as-first-quarter-earnings-fall-short
Disclaimer/ Disclosure: The Investors News Magazine is a third party publisher of news and research as well as creates original content as a news source. Original content created by Investors News Magazine is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investment involves risk and possible loss of investment. This site may be compensated by featured companies for news submissions and content marketing. Contact each company directly for press release questions. Disclosure is posted on each release if required but otherwise the news was not compensated for and is published for the sole interest of our readers.