Fred’s reports results for November; slight drop in sales

MEMPHIS, Tenn. Fred’s Inc. on Thursday reported a 6 percent decline in sales for the four weeks ending Nov. 29 to $141.7 million, a reflection of the company’s restructuring program in which 75 underperforming stores and 22 underperforming pharmacies are slated to be closed this year.

Excluding stores closed during 2008, total sales from ongoing stores were flat in November versus the same month last year, the deep discounter reported.

“November sales were on plan until the after-Thanksgiving sales promotional period,” stated Fred’s chief executive officer Michael Hayes. “The calendar shift, which reduced the number of post-Thanksgiving shopping days in the fiscal month, coupled with the end of the monthly pay cycle and consumer reluctance to buy discretionary items, all affected Black Friday sales and accounted for the miss on comparable store sales. Once again, customer traffic performed better than expected, but customers generally remained very cautious in their spending, directing most of their purchases toward promotional items and opportunistic buys,” he said. “Clearly, economic uncertainties continue to weigh on consumers everywhere.”

Comparable store sales for the month declined 1.8 percent.

Fred’s opened five new pharmacy express stores in November.  

Fred’s operates 663 discount general merchandise stores, including 24 franchised Fred’s stores in the southeastern United States