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03/25/2021

Rite Aid adjusts guidance for fiscal 2021

In response to a soft flu season, ongoing COVID-19 impacts and challenging weather conditions, Rite Aid adjusted its guidance for the fiscal year that ended Feb. 27, ahead of it sharing full results on April 15.
David Salazar
Managing Editor
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Rite Aid on Wednesday updated its guidance in response to a soft cough-cold and flu season, as well as ongoing COVID-19 impacts and challenging weather. For the company’s fiscal 2021, ended Feb. 27, Camp Hill, Pa.-based Rite Aid said it expects a net loss of between $90 million and $100 million, with revenue expected to be roughly $24 billion and adjusted EBITDA pegged at roughly $425 million to $435 million. 

Additionally, the company noted that front-end comparable-store sales declined roughly 5.6% in the fourth quarter, driven by a nearly 37% decline in cough-cold and flu-related categories. 

"During the fourth quarter our industry was impacted by a historically soft cough, cold and flu season, as well as the continued impacts of COVID on the deferral of elective procedures and related acute prescription volume and selling, general and administrative expenses. In addition, there were significant weather events in February that impacted our supply chain and depressed sales," said Heyward Donigan, president and CEO of Rite Aid. "Looking ahead, we have seen acute prescriptions return to positive levels in March, and we are proud to be selected as one of the retail providers administering COVID vaccines in the majority of our key states and cities, representing over 1,800 of our stores. We are significantly ramping up the number of vaccines we are administering on a daily basis, and have administered approximately 1 million COVID vaccines in March to date. Despite the extraordinary external headwinds that impacted our fourth quarter results, the entire organization is engaged, motivated and relentless in the execution of our RxEvolution strategy."

In addition to the decline in front-store comps, prescription comps declined by 1%, partly driven by a 14$ decline in acute prescriptions. Among the impacts to its fourth-quarter EBITDA, Rite Aid included a $20-24 million impact from lower incidence of cough-cold and flu-related illness, the same number impact from difficult weather conditions and $10-12 million related to continued effects of COVID-19. 

The company is set to share its fourth-quarter and full-year results on April 15. 

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