Last month, Rite Aid also terminated its merger agreement with Albertsons Companies Inc. and committed itself to executing its strategic plan as a standalone company. The company’s plan to leverage its retail pharmacies, health and wellness offerings along with its EnvisionRxOptions PBM provides some optimism though.
The company has missed estimates twice in the recent past and despite optimism on its strategic plan, the generic drug market conditions have dampened the sentiment surrounding the stock and there is a chance that Rite Aid might not bring a positive surprise this quarter. The stock has dropped 15% over the past one month.
During the first quarter, the company had posted a profit of $214.4 million or $0.20 per share, driven by one-time gains from the sale of its stores to Walgreens Boots Alliance (WBA). Net loss from continuing operations came in at $0.04 per share as a result of higher lease termination and impairment charges.
Total revenues in the first quarter fell 2% to $3.9 billion primarily due to store closures while revenues from continuing operations dropped 1% due to weaknesses in the Retail Pharmacy and Pharmacy Services segments.
For the full year of 2019, the retailer has guided for revenues of $21.7 billion to $22.1 billion with same-store sales expected to be flat to up 1%. In August, Rite Aid updated its outlook for net loss based on negative trends in the generic drug marketplace. Adjusted net loss is expected to range from $0.04 to breakeven per share versus the previous earnings range of $0.02 to $0.06 per share.