Rite Aid 2013 Annual Report Download - page 29

Download and view the complete annual report

Please find page 29 of the 2013 Rite Aid annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 125

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125

Results of Operations
Revenue and Other Operating Data
Year Ended
March 2, March 3, February 26,
2013 2012 2011
(52 Weeks) (53 Weeks) (52 Weeks)
(Dollars in thousands)
Revenues ....................... $25,392,263 $26,121,222 $25,214,907
Revenue (decline) growth ........... (2.8)% 3.6% (1.8)%
Same store sales (decline) growth ..... (0.3)% 2.0% (0.7)%
Pharmacy sales (decline) growth ...... (1.6)% 1.9% (1.8)%
Same store prescription count increase
(decrease) ..................... 3.4% 0.9% (1.2)%
Same store pharmacy sales (decline)
growth ....................... (1.0)% 2.4% (0.9)%
Pharmacy sales as a % of total sales . . . 67.6% 68.1% 67.8%
Third party sales as a % of total
pharmacy sales ................. 96.6% 96.5% 96.2%
Front end sales growth (decline) ...... 0.8% 0.7% (1.6)%
Same store front end sales growth
(decline) ...................... 1.4% 1.1% (0.3)%
Front end sales as a % of total sales . . . 32.4% 31.9% 32.2%
Store data:
Total stores (beginning of period) .... 4,667 4,714 4,780
New stores .................... — — 3
Closed stores .................. (44) (47) (69)
Total stores (end of period) ........ 4,623 4,667 4,714
Remodeled stores ............... 516 279 19
Relocated stores ................ 13 15 28
Revenues
Fiscal 2013 compared to Fiscal 2012: The 2.8% decrease in revenue was due primarily to one less
week in fiscal 2013 and a decrease in same store sales. The decrease in same stores sales was driven
primarily by recent generic introductions and continued reimbursement rate pressures, partially offset
by increased same store prescription count, the positive impact of our wellness + loyalty program, and
other management initiatives to increase sales. The increase in same store prescription count was
driven in part by the Walgreens / Express Scripts dispute which was settled in September 2012, our
immunization program and our wellness + loyalty program. We expect lower reimbursement rates, our
cycling of the Express Scripts business and the softening benefit of new generic introductions in fiscal
2014 to continue to have a negative impact on our revenues. Same store sales trends for fiscal 2013 and
fiscal 2012 are described in the following paragraphs. We include in same store sales all stores that
have been open at least one year. Stores in liquidation are considered closed. Relocation stores are not
included in same store sales until one year has lapsed.
Pharmacy same store sales decreased 1.0%. Pharmacy same store sales were negatively impacted
by recent generic drug introductions, which have a substantially lower selling price than their brand
counterparts but higher gross profit. Also contributing to the decrease are continued reimbursement
rate pressures. These decreases were partially offset by an increase of 3.4% in same store prescription
count driven in part by incremental prescriptions gained from the Walgreens / Express Scripts dispute
and by our immunization program and wellness + loyalty program.
28