(By Balachander) Rite Aid Corp. (NYSE:RAD) reported a narrower-than-expected loss for the second quarter boosted by continued front end sales and prescription count growth as well as an improvement in gross margin.
Yet the drugstore chain reduced its sales forecast for 2013, citing negative impact from new generic launches and continued reimbursement rate pressure.
The Camp Hill, Pennsylvania-based company lost 5 cents a share, compared with a loss of 11 cents per share in the year-ago quarter.
Revenue declined 0.6 percent to $6.2 billion and same store sales were flat.
Analysts, on average, expected loss per share of 7 cents on revenue of $6.21 billion for the second quarter.
Looking ahead for fiscal 2013, the company now expects loss per share in the range of 9 cents to 23 cents from prior expectations of loss of 13 cents to 29 cents. Sales are currently projected to be between $25.1 billion and $25.4 billion from $25.3 billion to $25.7 billion projected earlier. Analysts expect RAD to lose 15 cents a share on sales of $25.4 billion.
Rite Aid now forecasts same store sales to range from a decline of 1.0 percent to a 0.25 percent rise. It earlier expected same stores sales to range from a decline of 0.5 percent to a 1.0 percent rise for fiscal 2012.
The company's updated outlook reflects roughly 650 basis points reduction in pharmacy same store sales from new generic introductions.
RAD shares, which have been trading between $0.85 and $2.12 over the past year, closed Wednesday's regular trading at $1.31.