Rite Aid (RAD) Incurs Loss In Q1, Revenues Decline Y/Y
Zacks Investment Research | Jun 26, 2019 10:58PM ET
Rite Aid Corporation (NYSE:RAD) incurred first-quarter fiscal 2020 adjusted loss from continuing operations of 14 cents per share against the Zacks Consensus Estimate of earnings of 2 cents. In the year-ago quarter, the company reported adjusted earnings of 2 cents per share.
Notably, the bottom line was hurt by a decline in adjusted EBITDA coupled with higher income tax expenses, somewhat offset by lower depreciation and amortization expense as well as lease termination and impairment charges.
Management stated that quarterly results lagged expectations owing to prescription reimbursement rate pressure in the Retail Pharmacy Segment. Also, margin compression in the company’s Pharmacy Services Segment weighed on the company’s performance.
However, operating efficiency in the Retail Pharmacy Segment along with higher Medicare Part D revenues and prescription count sales growth remain impressive. Management is also optimistic about its drug purchasing agreement with McKesson Corporation (NYSE:MCK), which is likely to reinforce the company’s Retail Pharmacy business. Additionally, this Zacks Rank #2 (Buy) company remains confident about its ‘Path to the Future’ transformation initiative. You can see Zacks Investment Research
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