Attached files
| file | filename |
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| 8-K - FORM 8-K - RITE AID CORP | rad_8k.htm |
Exhibit 99.1
Press Release
For Further Information Contact:
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INVESTORS:
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MEDIA:
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Matt Schroeder
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Karen Rugen
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(717) 214-8867
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(717) 730-7766
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or investor@riteaid.com
FOR IMMEDIATE RELEASE
RITE AID REPORTS THIRD QUARTER FISCAL 2011 RESULTS
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·
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Third Quarter Net Loss of $0.09 per Diluted Share Compared to Prior Third Quarter Net Loss of $0.10 per Diluted Share
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·
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Third Quarter Adjusted EBITDA of $212.5 Million Compared to Prior Third Quarter Adjusted EBITDA of $254.2 Million
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·
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Weaker Flu Season Negatively Impacted Pharmacy Sales by $50 Million
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·
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Continued Strong Liquidity of $966 Million at Quarter End
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·
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Rite Aid Lowers Fiscal 2011 Outlook
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Camp Hill, PA (December 16, 2010)—Rite Aid Corporation (NYSE: RAD) today reported financial results for its third fiscal quarter ended November 27, 2010.
The company reported revenues of $6.2 billion, a net loss of $79.1 million or $0.09 per diluted share and Adjusted EBITDA of $212.5 million or 3.4 percent of revenues. Negatively impacting results were a slower start to the cough, cold and flu season coupled with an increase in workers’ compensation and general liability self insurance expense.
“The quarter was below our expectations. While the lack of cough, cold and flu had a significant impact on our results, the good news is that our front end sales began to turn around during the quarter and our team continued to do a good job of controlling costs. We are pleased to see that our loyalty program wellness + continues to gain traction with customers and patients,” said John Standley, Rite Aid president and CEO.
“Based on our third quarter results and our current view that same stores sales in the fourth quarter will be softer than we had expected, we have lowered our guidance for the full year,” Standley said.
- MORE -
Rite Aid FY11 Q3 Press Release – page 2
Third Quarter Summary
Revenues for the 13-week quarter were $6.2 billion versus revenues of $6.4 billion in last year’s like period. Revenues decreased 2.4 percent primarily as a result of a decline in pharmacy same store sales and store closings.
Same store sales for the quarter decreased 1.3 percent over the prior 13-week period, with flat front end sales and a 1.9 percent decrease in the pharmacy. Pharmacy sales included an approximate 242 basis point negative impact from new generic introductions. The number of prescriptions filled in comparable stores decreased 1.7 percent over the prior-year period, negatively impacted 1.3 percent by the lower incidence of cough, cold and flu. Prescription sales accounted for 68.3 percent of total drugstore sales, and third party prescription revenue was 96.2 percent of pharmacy sales.
Net loss was $79.1 million or $0.09 per diluted share compared to last year’s third quarter net loss of $83.9 million or $0.10 per diluted share. Lower lease termination and impairment charges, lower LIFO expense, lower interest and securitization expense and a reduction in depreciation and amortization helped offset the impact of the decline in Adjusted EBITDA on net loss.
Adjusted EBITDA (which is reconciled to net loss on the attached table) was $212.5 million or 3.4 percent of revenues for the third quarter compared to $254.2 million or 4.0 percent of revenues for the like period last year. Adjusted EBITDA was negatively impacted by $12.0 million due to fewer cough, cold and flu prescriptions filled year over year and a $29.5 million increase in workers’ compensation and general liability self insurance expense. The increase in self insurance expense is due to a reduction of reserves recorded in last year’s third quarter because of favorable claims experience.
In the third quarter, the company opened 1 new store, relocated 11 stores, remodeled 15 stores and closed 17 stores. Stores in operation at the end of the quarter totaled 4,731.
Other Events During the Quarter
As previously announced, during the quarter Rite Aid added the Save-A-Lot discount, limited grocery assortment concept to 10 of its existing stores in the Greenville SC market after entering into a licensing agreement with Save-A-Lot, a SUPERVALU company. The stores are co-branded Save-A-Lot Food Stores/Rite Aid Pharmacy and are owned and operated by Rite Aid.
Rite Aid Lowers Fiscal 2011 Guidance
Based on its third quarter results and its lower expectation for same store sales in the fourth quarter, Rite Aid lowered its fiscal 2011 guidance for sales and Adjusted EBITDA and increased fiscal 2011 guidance for net loss. Sales are now expected to be between $25.0 billion and $25.2 billion with same store sales expected to range from a decrease of 1.5 percent to a decrease of 0.9 percent. Adjusted EBITDA is expected to be between $815 million and $855 million. Net loss is expected to be between $655 million or $0.74 per diluted share and $525 million or $0.60 per diluted share. Based upon current spending trends and expectations for the remainder of the year, the guidance for capital expenditures has been reduced to $215 million.
-MORE-
Rite Aid FY11 Q3 Press Release – page 3
Conference Call Broadcast
Rite Aid will hold an analyst call at 8:30 a.m. Eastern Time today with remarks by Rite Aid's management team. The call will be simulcast via the internet and can be accessed through the websites www.riteaid.com in the conference call section of investor information and www.StreetEvents.com. Slides related to materials discussed on the call will be available on both sites. A playback of the call will be available on both sites starting at 12 p.m. Eastern Time today. A playback of the call will also be available by telephone beginning at 12 p.m. Eastern Time today until 11:59 p.m. Eastern Time on December 18, 2010. The playback number is 1-800-642-1687 from within the U.S. and Canada or 1-706-645-9291 from outside the U.S. and Canada with the eight-digit reservation number 29105610.
Rite Aid is one of the nation’s leading drugstore chains with more than 4,700 stores in 31 states and the District of Columbia with fiscal 2010 annual revenues of $25.7 billion. Information about Rite Aid, including corporate background and press releases, is available through Rite Aid’s website at www.riteaid.com.
This press release contains forward-looking statements, including guidance, which are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. Factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements include our high level of indebtedness; our ability to make interest and principal payments on our debt and satisfy the other covenants contained in our senior secured credit facility and other debt agreements; general economic conditions, including the impact of continued high unemployment and changing consumer behavior; inflation and interest rate movements; our ability to improve the operating performance of our stores in accordance with our long term strategy; our ability to realize same store sales growth; our ability to hire and retain qualified personnel; the efforts of private and public third-party payors to reduce prescription drug reimbursements and encourage mail order; competitive pricing pressures, including aggressive promotional activity from our competitors; decisions to close additional stores and distribution centers, which could result in further charges to our operating statement; our ability to manage expenses; our ability to realize the benefits from actions to further reduce costs and investment in working capital; continued consolidation of the drugstore industry; changes in state or federal legislation or regulations; the outcome of lawsuits and governmental investigations and health care reform; and our ability to maintain the listing of our common stock on the New York Stock Exchange and the resulting impact to our indebtedness and financial condition. Consequently, all of the forward-looking statements made in this press release, are qualified by these and other factors, risks and uncertainties. Readers are also directed to consider other risks and uncertainties discussed in documents filed by the Company with the Securities and Exchange Commission. Forward-looking statements can be identified through the use of words such as "may", "will", "intend", "plan", "project", "expect", "anticipate", "could", "should", "would", "believe", "estimate", "contemplate", and "possible".
See the attached table for a reconciliation of a non-GAAP financial measure, Adjusted EBITDA to net income (loss), the most comparable GAAP financial measure. We define Adjusted EBITDA as net income (loss) from operations excluding the impact of income taxes, interest expense and securitization costs, depreciation and amortization, LIFO adjustments, charges or credits for store closing and impairment, inventory write-downs related to closed stores, stock-based compensation expense, debt modifications and retirements, sale of assets and investments, revenue deferrals related to customer loyalty programs and other items.
# # #
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RITE AID CORPORATION AND SUBSIDIARIES
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CONSOLIDATED BALANCE SHEETS
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(Dollars in thousands)
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||||||||
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(unaudited)
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||||||||
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November 27, 2010
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February 27, 2010
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ASSETS
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Current assets:
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||||||||
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Cash and cash equivalents
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$ | 122,042 | $ | 103,594 | ||||
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Accounts receivable, net
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974,472 | 955,502 | ||||||
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Inventories, net of LIFO reserve of $875,193 and $831,113
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3,330,805 | 3,238,644 | ||||||
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Prepaid expenses and other current assets
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100,037 | 210,928 | ||||||
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Total current assets
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4,527,356 | 4,508,668 | ||||||
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Property, plant and equipment, net
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2,138,540 | 2,293,153 | ||||||
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Other intangibles, net
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701,497 | 823,088 | ||||||
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Other assets
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448,575 | 425,002 | ||||||
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Total assets
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$ | 7,815,968 | $ | 8,049,911 | ||||
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LIABILITIES AND STOCKHOLDERS' DEFICIT
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Current liabilities:
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Current maturities of long-term debt and lease financing obligations
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$ | 34,248 | $ | 51,502 | ||||
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Accounts payable
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1,292,350 | 1,159,069 | ||||||
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Accrued salaries, wages and other current liabilities
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1,107,235 | 965,121 | ||||||
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Total current liabilities
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2,433,833 | 2,175,692 | ||||||
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Long-term debt, less current maturities
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6,089,772 | 6,185,633 | ||||||
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Lease financing obligations, less current maturities
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125,074 | 133,764 | ||||||
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Other noncurrent liabilities
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1,175,505 | 1,228,373 | ||||||
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Total liabilities
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9,824,184 | 9,723,462 | ||||||
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Commitments and contingencies
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- | - | ||||||
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Stockholders' deficit:
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||||||||
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Preferred stock - Series G
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1 | 1 | ||||||
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Preferred stock - Series H
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159,261 | 152,304 | ||||||
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Common stock
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890,322 | 887,636 | ||||||
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Additional paid-in capital
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4,280,455 | 4,277,200 | ||||||
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Accumulated deficit
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(7,309,103 | ) | (6,959,372 | ) | ||||
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Accumulated other comprehensive loss
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(29,152 | ) | (31,320 | ) | ||||
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Total stockholders' deficit
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(2,008,216 | ) | (1,673,551 | ) | ||||
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Total liabilities and stockholders' deficit
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$ | 7,815,968 | $ | 8,049,911 | ||||
Chart 1
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RITE AID CORPORATION AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(Dollars in thousands, except per share amounts)
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(unaudited)
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Thirteen weeks ended November 27, 2010
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Thirteen weeks ended November 28, 2009
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Revenues
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$ | 6,202,353 | $ | 6,352,283 | ||||
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Costs and expenses:
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Cost of goods sold
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4,561,200 | 4,665,871 | ||||||
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Selling, general and administrative expenses
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1,578,142 | 1,605,213 | ||||||
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Lease termination and impairment charges
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17,003 | 35,072 | ||||||
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Interest expense
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133,742 | 135,770 | ||||||
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Gain on sale of assets, net
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(7,050 | ) | (1,459 | ) | ||||
| 6,283,037 | 6,440,467 | |||||||
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Loss before income taxes
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(80,684 | ) | (88,184 | ) | ||||
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Income tax benefit
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(1,613 | ) | (4,322 | ) | ||||
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Net loss
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$ | (79,071 | ) | $ | (83,862 | ) | ||
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Basic and diluted loss per share:
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Numerator for loss per share:
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Net loss
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$ | (79,071 | ) | $ | (83,862 | ) | ||
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Accretion of redeemable preferred stock
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(26 | ) | (26 | ) | ||||
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Cumulative preferred stock dividends
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(2,354 | ) | (2,218 | ) | ||||
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Loss attributable to common stockholders - basic and diluted
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$ | (81,451 | ) | $ | (86,106 | ) | ||
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Basic and diluted weighted average shares
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883,515 | 881,371 | ||||||
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Basic and diluted loss per share
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$ | (0.09 | ) | $ | (0.10 | ) | ||
Chart 2
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RITE AID CORPORATION AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(Dollars in thousands, except per share amounts)
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(unaudited)
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||||||||
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Thirty-nine weeks ended November 27, 2010
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Thirty-nine weeks ended November 28, 2009
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Revenues
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$ | 18,758,441 | $ | 19,205,331 | ||||
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Costs and expenses:
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Cost of goods sold
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13,766,924 | 14,056,578 | ||||||
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Selling, general and administrative expenses
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4,827,780 | 4,961,798 | ||||||
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Lease termination and impairment charges
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56,820 | 130,810 | ||||||
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Interest expense
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415,077 | 374,076 | ||||||
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Loss on debt modifications and retirements, net
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44,003 | 993 | ||||||
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Gain on sale of assets, net
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(10,786 | ) | (25,598 | ) | ||||
| 19,099,818 | 19,498,657 | |||||||
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Loss before income taxes
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(341,377 | ) | (293,326 | ) | ||||
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Income tax expense
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8,354 | 4,994 | ||||||
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Net loss
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$ | (349,731 | ) | $ | (298,320 | ) | ||
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Basic and diluted loss per share:
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||||||||
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Numerator for loss per share:
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||||||||
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Net loss
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$ | (349,731 | ) | $ | (298,320 | ) | ||
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Accretion of redeemable preferred stock
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(77 | ) | (77 | ) | ||||
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Cumulative preferred stock dividends
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(6,957 | ) | (6,556 | ) | ||||
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Loss attributable to common stockholders - basic and diluted
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$ | (356,765 | ) | $ | (304,953 | ) | ||
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Basic and diluted weighted average shares
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882,668 | 880,577 | ||||||
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Basic and diluted loss per share
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$ | (0.40 | ) | $ | (0.35 | ) | ||
Chart 3
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RITE AID CORPORATION AND SUBSIDIARIES
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SUPPLEMENTAL OPERATING AND CASH FLOW INFORMATION
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(Dollars in thousands, except per share amounts)
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(unaudited)
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Thirteen weeks ended November 27, 2010
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Thirteen weeks ended November 28, 2009
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SUPPLEMENTAL OPERATING INFORMATION
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Revenues
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$ | 6,202,353 | $ | 6,352,283 | ||||
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Cost of goods sold
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4,561,200 | 4,665,871 | ||||||
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Gross profit
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1,641,153 | 1,686,412 | ||||||
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LIFO charge
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3,024 | 14,770 | ||||||
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FIFO gross profit
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1,644,177 | 1,701,182 | ||||||
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Gross profit as a percentage of revenues
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26.46% | 26.55% | ||||||
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LIFO charge as a percentage of revenues
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0.05% | 0.23% | ||||||
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FIFO gross profit as a percentage of revenues
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26.51% | 26.78% | ||||||
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Selling, general and administrative expenses
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1,578,142 | 1,605,213 | ||||||
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Selling, general and administrative expenses as a percentage of revenues
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25.44% | 25.27% | ||||||
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Cash interest expense
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123,489 | 124,495 | ||||||
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Non-cash interest expense
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10,253 | 11,275 | ||||||
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Total interest expense
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133,742 | 135,770 | ||||||
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Securitization costs (included in SG&A)
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- | 8,362 | ||||||
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Total interest expense and securitization costs
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133,742 | 144,132 | ||||||
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Adjusted EBITDA
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212,499 | 254,192 | ||||||
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Adjusted EBITDA as a percentage of revenues
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3.43% | 4.00% | ||||||
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Net loss
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(79,071 | ) | (83,862 | ) | ||||
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Net loss as a percentage of revenues
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-1.27% | -1.32% | ||||||
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Total debt
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6,249,094 | 6,421,643 | ||||||
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Invested cash
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1,371 | 21,209 | ||||||
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Total debt net of invested cash
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6,247,723 | 6,400,434 | ||||||
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SUPPLEMENTAL CASH FLOW INFORMATION
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||||||||
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Payments for property, plant and equipment
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31,864 | 43,342 | ||||||
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Intangible assets acquired
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5,849 | 2,214 | ||||||
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Total cash capital expenditures
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37,713 | 45,556 | ||||||
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Equipment received for noncash consideration
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222 | 1,612 | ||||||
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Equipment financed under capital leases
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772 | - | ||||||
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Gross capital expenditures
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$ | 38,707 | $ | 47,168 | ||||
Chart 4
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RITE AID CORPORATION AND SUBSIDIARIES
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SUPPLEMENTAL OPERATING AND CASH FLOW INFORMATION
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(Dollars in thousands, except per share amounts)
|
||||||||
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(unaudited)
|
||||||||
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Thirty-nine weeks ended November 27, 2010
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Thirty-nine weeks ended November 28, 2009
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SUPPLEMENTAL OPERATING INFORMATION
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Revenues
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$ | 18,758,441 | $ | 19,205,331 | ||||
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Cost of goods sold
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13,766,924 | 14,056,578 | ||||||
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Gross profit
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4,991,517 | 5,148,753 | ||||||
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LIFO charge
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44,080 | 44,310 | ||||||
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FIFO gross profit
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5,035,597 | 5,193,063 | ||||||
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Gross profit as a percentage of revenues
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26.61% | 26.81% | ||||||
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LIFO charge as a percentage of revenues
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0.23% | 0.23% | ||||||
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FIFO gross profit as a percentage of revenues
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26.84% | 27.04% | ||||||
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Selling, general and administrative expenses
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4,827,780 | 4,961,798 | ||||||
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Selling, general and administrative expenses as a percentage of revenues
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25.74% | 25.84% | ||||||
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Cash interest expense
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381,442 | 345,079 | ||||||
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Non-cash interest expense
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33,635 | 28,997 | ||||||
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Total interest expense
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415,077 | 374,076 | ||||||
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Securitization costs (included in SG&A)
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- | 36,862 | ||||||
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Total interest expense and securitization costs
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415,077 | 410,938 | ||||||
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Adjusted EBITDA
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643,533 | 719,923 | ||||||
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Adjusted EBITDA as a percentage of revenues
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3.43% | 3.75% | ||||||
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Net loss
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(349,731 | ) | (298,320 | ) | ||||
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Net loss as a percentage of revenues
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-1.86% | -1.55% | ||||||
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Total debt
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6,249,094 | 6,421,643 | ||||||
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Invested cash
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1,371 | 21,209 | ||||||
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Total debt net of invested cash
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6,247,723 | 6,400,434 | ||||||
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SUPPLEMENTAL CASH FLOW INFORMATION
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||||||||
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Payments for property, plant and equipment
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104,383 | 124,541 | ||||||
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Intangible assets acquired
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16,071 | 5,661 | ||||||
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Total cash capital expenditures
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120,454 | 130,202 | ||||||
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Equipment received for noncash consideration
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2,428 | 9,450 | ||||||
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Equipment financed under capital leases
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2,836 | 185 | ||||||
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Gross capital expenditures
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$ | 125,718 | $ | 139,837 | ||||
Chart 5
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SUPPLEMENTAL INFORMATION
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RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA
|
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(In thousands)
|
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Thirteen weeks ended November 27, 2010
|
Thirteen weeks ended November 28, 2009
|
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Reconciliation of net loss to adjusted EBITDA:
|
||||||||
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Net loss
|
$ | (79,071 | ) | $ | (83,862 | ) | ||
|
Adjustments:
|
||||||||
|
Interest expense and securitization costs
|
133,742 | 144,132 | ||||||
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Income tax benefit
|
(1,613 | ) | (4,322 | ) | ||||
|
Depreciation and amortization
|
124,985 | 132,547 | ||||||
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LIFO charges
|
3,024 | 14,770 | ||||||
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Lease termination and impairment charges
|
17,003 | 35,072 | ||||||
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Stock-based compensation expense
|
4,167 | 5,826 | ||||||
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Gain on sale of assets, net
|
(7,050 | ) | (1,459 | ) | ||||
|
Closed facility liquidation expense
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2,386 | 4,445 | ||||||
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Severance costs
|
2,019 | 135 | ||||||
|
Customer loyalty card programs revenue deferral (a)
|
13,807 | - | ||||||
|
Other
|
(900 | ) | 6,908 | |||||
|
Adjusted EBITDA
|
$ | 212,499 | $ | 254,192 | ||||
|
Percent of revenues
|
3.43% | 4.00% | ||||||
|
Notes:
|
|
(a) Relates to deferral of revenues for our customer loyalty programs.
|
Chart 6
|
SUPPLEMENTAL INFORMATION
|
||||||||
|
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA
|
||||||||
|
(In thousands)
|
||||||||
|
Thirty-nine weeks ended November 27, 2010
|
Thirty-nine weeks ended November 28, 2009
|
|||||||
|
Reconciliation of net loss to adjusted EBITDA:
|
||||||||
|
Net loss
|
$ | (349,731 | ) | $ | (298,320 | ) | ||
|
Adjustments:
|
||||||||
|
Interest expense and securitization costs
|
415,077 | 410,938 | ||||||
|
Income tax expense
|
8,354 | 4,994 | ||||||
|
Depreciation and amortization
|
378,998 | 404,307 | ||||||
|
LIFO charges
|
44,080 | 44,310 | ||||||
|
Lease termination and impairment charges
|
56,820 | 130,810 | ||||||
|
Stock-based compensation expense
|
13,902 | 18,335 | ||||||
|
Gain on sale of assets, net
|
(10,786 | ) | (25,598 | ) | ||||
|
Loss on debt modifications and retirements, net
|
44,003 | 993 | ||||||
|
Closed facility liquidation expense
|
6,619 | 13,253 | ||||||
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Severance costs
|
2,029 | 6,184 | ||||||
|
Customer loyalty card programs revenue deferral (a)
|
34,238 | - | ||||||
|
Other
|
(70 | ) | 9,717 | |||||
|
Adjusted EBITDA
|
$ | 643,533 | $ | 719,923 | ||||
|
Percent of revenues
|
3.43% | 3.75% | ||||||
|
Notes:
|
|
(a) Relates to deferral of revenues for our customer loyalty programs.
|
Chart 7
|
RITE AID CORPORATION AND SUBSIDIARIES
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|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
|
(Dollars in thousands)
|
||||||||
|
(unaudited)
|
||||||||
|
Thirteen weeks ended November 27, 2010
|
Thirteen weeks ended November 28, 2009
|
|||||||
|
OPERATING ACTIVITIES:
|
||||||||
|
Net loss
|
$ | (79,071 | ) | $ | (83,862 | ) | ||
|
Adjustments to reconcile to net cash used in operating activities:
|
||||||||
|
Depreciation and amortization
|
124,985 | 132,547 | ||||||
|
Lease termination and impairment charges
|
17,003 | 35,072 | ||||||
|
LIFO charges
|
3,024 | 14,770 | ||||||
|
Gain on sale of assets, net
|
(7,050 | ) | (1,459 | ) | ||||
|
Stock-based compensation expense
|
4,167 | 5,826 | ||||||
|
Changes in operating assets and liabilities:
|
||||||||
|
Net repayments to accounts receivable securitization
|
- | (400,000 | ) | |||||
|
Accounts receivable
|
(27,633 | ) | (65,332 | ) | ||||
|
Inventories
|
(76,330 | ) | (166,340 | ) | ||||
|
Accounts payable
|
(38,648 | ) | 91,643 | |||||
|
Other assets and liabilities, net
|
33,146 | 2,084 | ||||||
|
Net cash used in operating activities
|
(46,407 | ) | (435,051 | ) | ||||
|
INVESTING ACTIVITIES:
|
||||||||
|
Payments for property, plant and equipment
|
(31,864 | ) | (43,342 | ) | ||||
|
Intangible assets acquired
|
(5,849 | ) | (2,214 | ) | ||||
|
Proceeds from dispositions of assets and investments
|
8,345 | 3,510 | ||||||
|
Net cash used in investing activities
|
(29,368 | ) | (42,046 | ) | ||||
|
FINANCING ACTIVITIES:
|
||||||||
|
Proceeds from issuance of long-term debt
|
- | 396,703 | ||||||
|
Net proceeds from revolver
|
58,000 | 124,000 | ||||||
|
Principal payments on long-term debt
|
(6,147 | ) | (7,284 | ) | ||||
|
Change in zero balance cash accounts
|
13,789 | 13,448 | ||||||
|
Net proceeds from the issuance of common stock
|
7 | 30 | ||||||
|
Deferred financing costs paid
|
(244 | ) | (14,178 | ) | ||||
|
Net cash provided by financing activities
|
65,405 | 512,719 | ||||||
|
(Decrease) increase in cash and cash equivalents
|
(10,370 | ) | 35,622 | |||||
|
Cash and cash equivalents, beginning of period
|
132,412 | 121,007 | ||||||
|
Cash and cash equivalents, end of period
|
$ | 122,042 | $ | 156,629 | ||||
Chart 8
|
RITE AID CORPORATION AND SUBSIDIARIES
|
||||||||
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
|
(Dollars in thousands)
|
||||||||
|
(unaudited)
|
||||||||
|
Thirty-nine weeks ended November 27, 2010
|
Thirty-nine weeks ended November 28, 2009
|
|||||||
|
OPERATING ACTIVITIES:
|
||||||||
|
Net loss
|
$ | (349,731 | ) | $ | (298,320 | ) | ||
|
Adjustments to reconcile to net cash provided by (used in) operating activities:
|
||||||||
|
Depreciation and amortization
|
378,998 | 404,307 | ||||||
|
Lease termination and impairment charges
|
56,820 | 130,810 | ||||||
|
LIFO charges
|
44,080 | 44,310 | ||||||
|
Gain on sale of assets, net
|
(10,786 | ) | (25,598 | ) | ||||
|
Stock-based compensation expense
|
13,902 | 18,335 | ||||||
|
Loss on debt modification and retirements, net
|
44,003 | 993 | ||||||
|
Proceeds from insured loss
|
- | 1,380 | ||||||
|
Changes in operating assets and liabilities:
|
||||||||
|
Net repayments to accounts receivable securitization
|
- | (555,000 | ) | |||||
|
Accounts receivable
|
(18,970 | ) | (8,446 | ) | ||||
|
Inventories
|
(136,496 | ) | (111,301 | ) | ||||
|
Accounts payable
|
272,730 | 128,646 | ||||||
|
Other assets and liabilities, net
|
172,852 | 45,575 | ||||||
|
Net cash provided by (used in) operating activities
|
467,402 | (224,309 | ) | |||||
|
INVESTING ACTIVITIES:
|
||||||||
|
Payments for property, plant and equipment
|
(104,383 | ) | (124,541 | ) | ||||
|
Intangible assets acquired
|
(16,071 | ) | (5,661 | ) | ||||
|
Proceeds from sale-leaseback transactions
|
- | 6,532 | ||||||
|
Proceeds from dispositions of assets and investments
|
17,266 | 39,208 | ||||||
|
Net cash used in investing activities
|
(103,188 | ) | (84,462 | ) | ||||
|
FINANCING ACTIVITIES:
|
||||||||
|
Proceeds from issuance of long-term debt
|
650,000 | 1,303,307 | ||||||
|
Net repayments to revolver
|
(22,000 | ) | (714,000 | ) | ||||
|
Principal payments on long-term debt
|
(775,236 | ) | (167,174 | ) | ||||
|
Change in zero balance cash accounts
|
(144,693 | ) | (49,475 | ) | ||||
|
Net proceeds from the issuance of common stock
|
101 | 30 | ||||||
|
Financing fees paid for early debt redemption
|
(19,666 | ) | - | |||||
|
Deferred financing costs paid
|
(34,272 | ) | (59,323 | ) | ||||
|
Net cash (used in) provided by financing activities
|
(345,766 | ) | 313,365 | |||||
|
Increase in cash and cash equivalents
|
18,448 | 4,594 | ||||||
|
Cash and cash equivalents, beginning of period
|
103,594 | 152,035 | ||||||
|
Cash and cash equivalents, end of period
|
$ | 122,042 | $ | 156,629 | ||||
Chart 9
|
RITE AID CORPORATION AND SUBSIDIARIES
|
||||||||
|
SUPPLEMENTAL INFORMATION
|
||||||||
|
RECONCILIATION OF NET LOSS GUIDANCE TO ADJUSTED EBITDA GUIDANCE
|
||||||||
|
YEAR ENDING FEBRUARY 26, 2011
|
||||||||
|
(In thousands, except per share amounts)
|
||||||||
|
Guidance Range
|
||||||||
|
Low
|
High
|
|||||||
|
Sales
|
$ | 25,000,000 | $ | 25,150,000 | ||||
|
Same store sales
|
-1.50% | -0.90% | ||||||
|
Gross capital expenditures
|
$ | 215,000 | $ | 215,000 | ||||
|
Reconciliation of net loss to adjusted EBITDA:
|
||||||||
|
Net loss
|
$ | (655,000 | ) | $ | (525,000 | ) | ||
|
Adjustments:
|
||||||||
|
Interest expense
|
560,000 | 550,000 | ||||||
|
Income tax expense
|
20,000 | 15,000 | ||||||
|
Depreciation and amortization
|
505,000 | 495,000 | ||||||
|
LIFO charge
|
70,000 | 60,000 | ||||||
|
Store closing, liquidation, and impairment charges
|
200,000 | 160,000 | ||||||
|
Stock-based compensation expense
|
20,000 | 15,000 | ||||||
|
Customer loyalty card programs revenue deferral (a)
|
50,000 | 40,000 | ||||||
|
Loss on debt modification
|
45,000 | 45,000 | ||||||
|
Other
|
- | - | ||||||
|
Adjusted EBITDA
|
$ | 815,000 | $ | 855,000 | ||||
|
Diluted loss per share
|
$ | (0.74 | ) | $ | (0.60 | ) | ||
|
(a) Relates to deferral of revenues for our customer loyalty programs.
|
Chart 10