Rite Aid Posts Adj. Loss In Q2, Comps. Down 3.4%; Names Kermit Crawford COO

(RTTNews) - Rite Aid Corp. (RAD) reported a second-quarter adjusted net loss of $15.6 million or $0.01 per share compared to adjusted net income of $36.4 million or $0.03 per share, previous year. Adjusted EBITDA was $213.3 million compared to $312.7 million, last year. The company said the decline in adjusted EBITDA was due to a decrease of $98.6 million in the Retail Pharmacy Segment. The decrease in the Retail Pharmacy Segment EBITDA was primarily driven by a decline in pharmacy gross profit, which was due to a decline in reimbursement rates.

Second-quarter revenues were $7.7 billion compared to $8.0 billion, last year, a decrease of 4.4 percent. Retail Pharmacy Segment revenues were $6.3 billion and decreased 3.4 percent as a result of a decrease in same store sales and reimbursement rates. Revenues in the company's Pharmacy Services Segment were $1.5 billion and decreased 8.7 percent, due to an election to participate in fewer Medicare Part D regions. Same store sales for the quarter decreased 3.4 percent over the prior year, consisting of a 4.6 percent decrease in pharmacy sales and a 0.9 percent decrease in front-end sales.

Rite Aid also announced that Kermit Crawford, former executive vice president and president of pharmacy health and wellness for Walgreens, is joining the company as president and chief operating officer, effective Oct. 5. Most recently, Crawford has been a retail and healthcare adviser and consultant for New York City-based Sycamore Partners, a private equity firm specializing in retail and consumer investments. He also serves on the board for Allstate and LifePoint Health.

"While our performance for the quarter reflects a challenging reimbursement rate environment and the effects of an extended merger and asset sale process, securing regulatory clearance for the amended asset sale agreement with Walgreens Boots Alliance gives us a clear path forward to realize the benefits of the transaction and implement our plans to deliver improved results," said Rite Aid CEO John Standley.