Company postpones earnings report
A filing yesterday with the Securities and Exchange Commission says that the retailer’s board in the fourth quarter approved a plan “to actively market for sale the company’s specialty pharmacy business.” It says that the chain required additional time to present its specialty pharmacy results as discontinued operations in its earnings report.
Fred’s, which had been poised last year to buy enough Rite Aid stores to have made it the third-largest drug chain in the country — has been seeking a “strategic turnaround.”
For the third quarter ended Oct. 28, it reported a net loss of $51.8 million or $1.38 per share, compared to a net loss of $38.4 million, or $1.05 per share, a year earlier. In reporting those results, president and CEO Michael Bloom discussed a focus on beauty, beer, wine, and tobacco sales. Fred‘s saw “a complete turnaround” in its tobacco business, “significantly enhanced” cosmetics and rolled out beer to about 150 stores and wine to roughly 50 stores, he said.
Overall, Fred‘s has about 600 discount general merchandise stores in the Southeast — more than half of which house pharmacies — and operates three specialty pharmacy-only locations. Included in the retail network are 13 franchised locations.
The chain was ready last year to acquire up to 1,200 Rite Aid stores to secure the Federal Trade Commission’s approval of Walgreens Boots Alliance’s takeover of the rest of Rite Aid. But FTC objections to the bigger deal proved insurmountable, and WBA and Rite Aid canceled their merger and their agreement with Fred’s in June.