The discount and pharmacy chain said Thursday that for the four weeks ended Feb. 25, sales totaled $165.4 million, down 3.5% from $171.4 million a year earlier.
Comparable-store sales for February fell 4%, compared with a 4.8% decline in January and a 0.8% uptick in February 2016.
“Despite the tax refund delay impacting a significant percentage of our customer base and our front-of-store sales, we are pleased with the progress we are making against our strategic plan, demonstrated by our continued improvement in retail and specialty pharmacy. This is an affirmation that our health care strategy is working,” chief executive officer Michael Bloom said in a statement. “Notably, comparable-store sales in our overall pharmacy business were strong in the month, driven by positive adjusted prescription comparisons.”
Fred’s reported that individual tax refunds are down about 13% year over year, and the delay of refunds offset the retailer’s progress in its front-end strategy.
“However, comparable sales in our front of store improved in the last week of February as individual refunds were received by customers,” according to Bloom. “Looking ahead to March and the remainder of the first quarter, we expect customer spending will continue to increase as tax refunds are received.”
Fred’s operates 643 discount general merchandise stores, including 354 in-store pharmacies, and three specialty pharmacy-only locations in 15 Southeastern states.