- Revenues of $5.7 Billion, Compared to Prior Year Revenues of
$6.0 Billion
- Retail Comparable Same Store Prescriptions Increased 4.7
Percent – Comparable Same Store Prescriptions, Excluding COVID
Impact, Increased 7.4 Percent
- Net Loss of $306.7 Million Compared to Prior Year Net Loss
of $110.2 Million – Increase Largely Attributable to a Goodwill
Impairment Charge at Elixir
- Adjusted EBITDA of $91.7 Million, Compared to Prior Year
Adjusted EBITDA of $100.1 Million
- Updates Fiscal 2024 Outlook
Rite Aid Corporation (NYSE: RAD) today reported operating
results for its first fiscal quarter ended June 3, 2023.
“Our first quarter results were driven by strong script growth,
solid pharmacy margins and early progress with our turnaround
program, which offset underperformance on front-end sales in the
Retail Pharmacy Segment and a higher-than-expected medical loss
ratio at Elixir Insurance,” said Elizabeth “Busy” Burr, interim
chief executive officer. “To help mitigate this, we are making
targeted reductions to SG&A and capital expenditures over the
remainder of the year. Importantly, we made good progress on
turnaround initiatives across key areas of the business, and we
continue to believe we are on track to achieve Adjusted EBITDA
growth in fiscal years 2025 and 2026.”
Consolidated First Quarter Summary
(dollars in thousands)
Thirteen
Week Period Ended
Thirteen
Week Period Ended
June 3,
2023
May 28,
2022
Revenues
$
5,653,162
$
6,014,583
Net loss
(306,718)
(110,191)
Adjusted EBITDA
91,715
100,130
For the first quarter, the Company reported a net loss of $306.7
million, or $5.56 loss per share, Adjusted net loss of $40.1
million, or $0.73 loss per share, and Adjusted EBITDA of $91.7
million, or 1.6 percent of revenues.
Revenues for the quarter were $5.65 billion compared to revenues
of $6.01 billion in the prior year’s quarter, largely due to the
reduction in the Company’s Prescription Drug Plan (PDP) membership
and the loss of commercial clients at Elixir. The reduction in
revenues for the first quarter was partially offset by an increase
in Retail Pharmacy Segment revenues, driven by an increase in
pharmacy sales.
First quarter net loss was $306.7 million, or $5.56 loss per
share, compared to last year’s first quarter net loss of $110.2
million, or $2.03 loss per share. The increase in net loss is
primarily due to a non-cash charge to write down Elixir goodwill,
driven by performance in Elixir Insurance’s Individual Part D Plan
and the Company’s decision to exit the Individual Part D market
beginning in January 2024. Other factors contributing to the higher
net loss were higher restructuring-related charges, a lower gain on
sale of assets, higher interest expense and a decrease in Adjusted
EBITDA. These were partially offset by decreased facility exit and
impairment charges.
Retail Pharmacy Segment
(dollars in thousands)
Thirteen
Week Period Ended
Thirteen
Week Period Ended
June 3,
2023
May 28,
2022
Revenues
$
4,492,329
$
4,345,356
Adjusted EBITDA
70,049
73,682
Retail Pharmacy Segment revenues increased 3.4 percent over the
prior year quarter driven by an increase in both acute and
maintenance prescriptions, partially offset by a reduction in COVID
vaccine and testing revenue as well as store closures. Same store
sales for the first quarter increased 8.4 percent over the prior
year period, consisting of a 13.3 percent increase in pharmacy
sales, partially offset by a 4.4 percent decrease in front-end
sales. Front-end same store sales, excluding cigarettes and tobacco
products, decreased 3.8 percent. The number of prescriptions filled
in same stores, adjusted to 30-day equivalents, increased 4.7
percent over the prior year period. Total same store prescriptions,
excluding COVID immunizations and tests, increased 7.4 percent,
with same store maintenance prescriptions increasing 7.6 percent
and other same store acute prescriptions increasing 6.8 percent.
Prescription sales accounted for 73.9 percent of total drugstore
sales. Total store count at the end of the first quarter was
2,284.
Retail Pharmacy Segment Adjusted EBITDA was $70.0 million, or
1.6 percent of revenues, for the first quarter compared to last
year’s first quarter Adjusted EBITDA of $73.7 million, or 1.7
percent of revenues. The decline in Adjusted EBITDA was due to a
decrease in Adjusted EBITDA gross profit of $8.4 million, partially
offset by decreased Adjusted EBITDA selling, general and
administrative (SG&A) expenses of $4.8 million. Gross profit
was negatively impacted by the decline in front-end sales, COVID
vaccinations and testing and increased shrink expense, partially
offset by an increase in prescriptions sold, better than expected
recovery rates and the impact of generic drug settlements. SG&A
expenses benefited from lower occupancy and other operating costs
due to store closures and cost control initiatives.
Pharmacy Services Segment
(dollars in thousands)
Thirteen
Week Period Ended
Thirteen
Week Period Ended
June 3,
2023
May 28,
2022
Revenues
$
1,196,154
$
1,725,857
Adjusted EBITDA
21,666
26,448
Pharmacy Services Segment revenues were $1.2 billion for the
quarter, a decrease of 30.7 percent compared to the prior year
quarter. The decrease in revenues was primarily the result of a
decrease in Elixir Individual Part D Insurance membership due to a
change in the Company’s pricing structure and loss of commercial
clients, partially offset by increased utilization and higher drugs
costs.
Pharmacy Services Segment Adjusted EBITDA was $21.7 million, or
1.8 percent of revenues, for the first quarter compared to last
year’s first quarter Adjusted EBITDA of $26.4 million, or 1.5
percent of revenues. The decrease in Adjusted EBITDA resulted from
the lower membership as mentioned above and an increase in the
medical loss ratio at Elixir Insurance, partially offset by
improved procurement economics and reductions in SG&A
expense.
Outlook for Fiscal 2024
The following fiscal 2024 outlook is forward-looking
information, reflecting the Company’s expectations as of June 29,
2023, and subject to a range of assumptions and uncertainties
described below and in documents that the Company files or
furnishes with the Securities and Exchange Commission (the
“SEC”).
Based on recent business trends, the Company is reducing total
company Adjusted EBITDA guidance by $10 million to be between $330
million and $360 million. Pharmacy Services Segment Adjusted EBITDA
expectations are being lowered by $10 million to be between $90
million and $100 million due to higher drug costs and a higher
medical loss ratio at Elixir Insurance. Retail Pharmacy Segment
Adjusted EBITDA remains unchanged and is expected to be between
$240 million and $260 million, which is a result of tougher
front-end sales trends balanced with cost savings.
Total revenues are expected to be between $22.6 billion and
$23.0 billion in fiscal 2024. Retail Pharmacy Segment revenue is
expected to be between $18.0 billion and $18.3 billion, and
Pharmacy Services Segment revenue is expected to be between $4.6
billion and $4.7 billion, net of any intercompany revenues to the
Retail Pharmacy Segment.
Net loss is expected to be between approximately $650 million
and $680 million.
Adjusted net loss per share is expected to be between $4.29 and
$4.78.
Capital expenditures are now expected to be approximately $175
million, with a focus on investments in technology, prescription
file purchases and distribution center automation.
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 broadcast via the Internet at
https://investors.riteaid.com. The telephone replay will be
available beginning at 12:00 p.m. Eastern Time on June 29, 2023,
and ending at 11:59 p.m. Eastern Time on July 29, 2023. To access
the replay of the call, telephone (800) 770-2030 or (647) 362-9199
and enter the seven-digit reservation number 9029129. The webcast
replay of the call will also be available at
https://investors.riteaid.com starting at 12 p.m. Eastern Time
today. The playback will be available until the Company’s next
conference call.
About Rite Aid Corporation
Rite Aid Corporation is on the front lines of delivering
healthcare services and retail products to Americans 365 days a
year. Our pharmacists are uniquely positioned to engage with
customers and improve their health outcomes. We provide an array of
whole being health products and services for the entire family
through over 2,200 retail pharmacy locations across 17 states.
Through Elixir, we provide pharmacy benefits and services to
millions of members nationwide. For more information, visit
www.riteaid.com.
Cautionary Statement Regarding Forward-Looking
Statements
Statements in this release that are not historical, are
forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Such statements include, but are not limited to, statements
regarding Rite Aid's outlook and guidance for fiscal 2024; Rite
Aid’s plan to reduce SG&A expense and capital expenditure
spend; the continued impact of the global coronavirus (COVID-19)
pandemic on Rite Aid’s business; the continued impact of negative
trends in Rite Aid’s front end sales and gross profit in the retail
segment; and any assumptions underlying any of the foregoing. Words
such as "anticipate," "believe," "continue," "could," "estimate,"
"expect," "intend," "may," "plan," "predict," "project," "should,"
and "will" and variations of such words and similar expressions are
intended to identify such forward-looking statements.
These forward-looking statements are not guarantees of future
performance and involve risks, assumptions and uncertainties,
including, but not limited to: risks related to the prolonged
impact of the COVID-19 global pandemic and the emerging new
variants, including the government responses thereto; the impact of
COVID-19 on our workforce, operations, stores, expenses, and supply
chain, and the operations or behaviors of our customers, suppliers
and business partners; our ability to successfully implement our
turnaround program and other strategies; the impact of our high
level of indebtedness, the ability to refinance such indebtedness
on acceptable terms (including the impact of rising interest rates,
market volatility, and continuing actions by the United States
Federal Reserve) and our ability to satisfy our obligations and the
other covenants contained in our debt agreements; outcome of
pending or new litigation and government investigations, including,
without limitation, those related to opioids, “usual and customary”
pricing, government payer programs or other matters; our ability to
monetize (and on reasonably available terms) the CMS receivable
created in our Part D business; general competitive, economic,
industry, market, political (including healthcare reform) and
regulatory conditions (including changes to laws or regulations
relating to labor or wages), including continued impacts of
inflation or other pricing environment factors on our costs,
liquidity and our ability to pass on price increases to our
customers, including as a result of inflationary and deflationary
pressures, a decline in consumer financial position, whether due to
inflation or other factors, as well as other factors specific to
the markets in which we operate; the impact of private and public
third-party payers continued reduction in prescription drug
reimbursements, new or disruptive business models or practices, and
efforts to encourage mail order; our ability to manage expenses and
our investments in working capital; our ability to achieve the
benefits of our efforts to reduce the costs of our generic and
other drugs; our ability to achieve cost savings and other benefits
of our restructuring efforts within our anticipated timeframe, if
at all; the outcome of our continuing efforts to monitor and comply
with applicable laws, orders, regulations, policies and procedures;
and our ability to partner and have relationships with health plans
and health systems; and any requirement to incur additional
impairment charges.
These and other risks, assumptions and uncertainties are more
fully described in Item 1A (Risk Factors) of our most recent Annual
Report on Form 10-K and in other documents that we file or furnish
with the Securities and Exchange Commission
(the “SEC”), which you are encouraged to read. To the extent
that COVID-19 adversely affects our business and financial results,
it may also have the effect of heightening many of such risk
factors.
Should one or more of these risks or uncertainties materialize,
or should underlying assumptions prove incorrect, actual results
may vary materially from those indicated or anticipated by such
forward-looking statements. Accordingly, you are cautioned not to
rely on these forward-looking statements, which speak only as of
the date they are made.
The degree to which COVID-19 may adversely affect Rite Aid’s
results and operations, including its ability to achieve its
outlook for fiscal 2024 guidance, will depend on numerous evolving
factors and future developments, which are highly uncertain. As a
result, the impact on Rite Aid’s financial and operating results
cannot be reasonably estimated with specificity at this time, but
the impact could be material. Rite Aid expressly disclaims any
current intention, and assumes no duty, to update publicly any
forward-looking statement after the distribution of this release,
whether as a result of new information, future events, changes in
assumptions or otherwise.
All references to “Company” and “Rite Aid” as used throughout
this release refer to Rite Aid Corporation and its affiliates.
Reconciliation of Non-GAAP Financial Measures
Rite Aid separately reports financial results on the basis of
Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Diluted
Share, Adjusted EBITDA, Adjusted EBITDA Gross Profit and Adjusted
EBITDA SG&A, which are non-GAAP financial measures. See the
attached tables for a reconciliation of Adjusted Net Income (Loss),
Adjusted Net Income (Loss) per Diluted Share and Adjusted EBITDA to
net income (loss), and net income (loss) per diluted share, which
are the most directly comparable GAAP financial measures. Adjusted
Net Income (Loss) and Adjusted Net Income (Loss) per Diluted Share
exclude amortization expense, merger and acquisition-related costs,
non-recurring litigation and other contractual settlements, gains
or losses on debt modifications and retirements, LIFO adjustments,
goodwill and intangible asset impairment charges,
restructuring-related costs, the gain or loss on Bartell
acquisition, and the change in estimate related to manufacturer
rebate receivables. Rite Aid believes Adjusted Net Income (Loss)
and Adjusted Net Income (Loss) per Diluted Share serve as
appropriate measures to be used in evaluating the performance of
its business and help its investors better compare its operating
performance over multiple periods.
Adjusted EBITDA is defined as net income (loss) excluding the
impact of income taxes, interest expense, depreciation and
amortization, LIFO adjustments, charges or credits for facility
exit and impairment, goodwill and intangible asset impairment
charges, inventory write-downs related to store closings, gains or
losses on debt modifications and retirements, and other items
(including stock-based compensation expense, merger and
acquisition-related costs, non-recurring litigation and other
contractual settlements, severance, restructuring-related costs,
costs related to facility closures, gain or loss on sale of assets,
the gain or loss on Bartell acquisition, and the change in estimate
related to manufacturer rebate receivables). The add back of LIFO
(credit) charge when calculating Adjusted EBITDA, Adjusted Net
Income (Loss) and Adjusted Net Income (Loss) per Diluted Share
removes the entire impact of LIFO (credits) charges, and
effectively reflects Rite Aid's results as if the company was on a
FIFO inventory basis. Rite Aid believes Adjusted EBITDA serves as
an appropriate measure in evaluating the performance of its
business and helps its investors better compare its operating
performance with its competitors.
Adjusted EBITDA Gross Profit includes LIFO adjustments,
depreciation and amortization (COGS portion only) and other items.
See the attached tables for a reconciliation of Adjusted EBITDA
Gross Profit to Revenue, which is the most directly
comparable GAAP financial measure. Adjusted EBITDA SG&A
excludes depreciation and amortization (SG&A portion only),
stock-based compensation expense, merger and acquisition-related
costs, non-recurring litigation and other contractual settlements,
and other items. See the attached tables for a reconciliation of
Adjusted EBITDA SG&A to Revenue, which is the most directly
comparable GAAP financial measure. The Company believes Adjusted
EBITDA Gross Profit and Adjusted EBITDA SG&A serve as
appropriate measures in evaluating the performance of its business
and helps its investors better compare its operating performance
with its competitors.
The Company presents these non-GAAP financial measures in order
to provide transparency to its investors because they are measures
that management uses to assess both management performance and the
financial performance of its operations and to allocate resources.
In addition, management believes that these measures may assist
investors with understanding and evaluating the Company’s
initiatives to drive improved financial performance and enables
investors to supplementally compare its operating performance with
the operating performance of its competitors including with those
of its competitors having different capital structures. While the
Company has excluded certain of these items from historical
non-GAAP financial measures, there is no guarantee that the items
excluded from non-GAAP financial measures will not continue into
future periods. For instance, the Company expects to continue to
experience charges for facility exit and impairment charges and
inventory write-downs related to store closures as the Company
continues to complete a multi-year strategic initiative designed to
improve overall performance. The Company also expects to continue
to experience and report restructuring-related charges associated
with continued execution of its strategic initiatives.
Adjusted EBITDA, Adjusted Net Income (Loss), Adjusted Net Income
(Loss) per Diluted Share or other non-GAAP measures should not be
considered in isolation from, and are not intended to represent an
alternative measure of, operating results or of cash flows from
operating activities, as determined in accordance with GAAP. The
Company’s definition of these non-GAAP measures may not be
comparable to similarly titled measurements reported by other
companies, including companies in its industry.
RITE AID CORPORATION AND SUBSIDIARIES CONSOLIDATED
BALANCE SHEETS (Dollars in thousands) (unaudited)
June 3, 2023 March 4, 2023 ASSETS Current assets: Cash and
cash equivalents
$
135,527
$
157,151
Accounts receivable, net
1,392,348
1,149,958
Inventories, net of LIFO reserve of $547,432 and $539,932
1,950,413
1,900,744
Prepaid expenses and other current assets
171,175
93,194
Total current assets
3,649,463
3,301,047
Property, plant and equipment, net
892,540
907,771
Operating lease right-of-use assets
2,457,110
2,497,206
Goodwill
356,436
507,936
Other intangibles, net
244,883
250,112
Deferred tax assets
12,368
12,368
Other assets
37,618
50,922
Total assets
$
7,650,418
$
7,527,362
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY Current
liabilities: Current maturities of long-term debt and lease
financing obligations
$
6,060
$
6,332
Accounts payable
1,505,741
1,494,611
Accrued salaries, wages and other current liabilities
772,058
724,529
Current portion of operating lease liabilities
488,712
502,403
Total current liabilities
2,772,571
2,727,875
Long-term debt, less current maturities
3,327,970
2,925,258
Long-term operating lease liabilities
2,345,277
2,372,943
Lease financing obligations, less current maturities
12,151
12,580
Other noncurrent liabilities
139,897
130,482
Total liabilities
8,597,866
8,169,138
Commitments and contingencies
-
-
Stockholders' (deficit) equity: Common stock
56,708
56,629
Additional paid-in capital
5,918,931
5,917,964
Accumulated deficit
(6,908,235
)
(6,601,517
)
Accumulated other comprehensive loss
(14,852
)
(14,852
)
Total stockholders' (deficit) equity
(947,448
)
(641,776
)
Total liabilities and stockholders' (deficit) equity
$
7,650,418
$
7,527,362
RITE AID CORPORATION AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF OPERATIONS (Dollars in thousands, except per share
amounts) (unaudited) Thirteen weeks endedJune
3, 2023 Thirteen weeks endedMay 28, 2022 Revenues
$
5,653,162
$
6,014,583
Costs and expenses: Cost of revenues
4,474,636
4,817,854
Selling, general and administrative expenses
1,255,223
1,217,929
Facility exit and impairment charges
20,001
66,571
Goodwill and intangible asset impairment charges
151,500
-
Interest expense
65,220
48,119
Gain on sale of assets, net
(8,193
)
(29,196
)
5,958,387
6,121,277
Loss before income taxes
(305,225
)
(106,694
)
Income tax expense
1,493
3,497
Net loss
$
(306,718
)
$
(110,191
)
Basic and diluted loss per share:
Numerator for loss per share: Net loss attributable to common
stockholders - basic and diluted
$
(306,718
)
$
(110,191
)
Denominator: Basic and diluted weighted
average shares
55,179
54,348
Basic and diluted loss per share
$
(5.56
)
$
(2.03
)
RITE AID CORPORATION AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF CASH FLOWS (Dollars in thousands) (unaudited)
Thirteen weeks endedJune 3, 2023 Thirteen weeks
endedMay 28, 2022 OPERATING ACTIVITIES: Net loss
$
(306,718
)
$
(110,191
)
Adjustments to reconcile to net cash used in operating activities:
Depreciation and amortization
65,895
70,073
Facility exit and impairment charges
20,001
66,571
Goodwill and intangible asset impairment charges
151,500
-
LIFO charge
7,500
-
Change in allowances for uncollectible accounts receivable
4,004
3,763
Gain on sale of assets, net
(8,193
)
(29,196
)
Stock-based compensation expense
1,081
3,334
Changes in operating assets and liabilities: Accounts receivable
(246,838
)
(104,458
)
Inventories
(57,169
)
(15,827
)
Accounts payable
20,558
(137,572
)
Operating lease right-of-use assets and operating lease liabilities
(10,857
)
(14,812
)
Other assets
(64,687
)
751
Other liabilities
51,385
15,327
Net cash used in operating activities
(372,538
)
(252,237
)
INVESTING ACTIVITIES: Payments for property, plant and equipment
(35,891
)
(73,176
)
Intangible assets acquired
(11,612
)
(12,248
)
Proceeds from dispositions of assets and investments
8,157
30,839
Net cash used in investing activities
(39,346
)
(54,585
)
FINANCING ACTIVITIES: Net proceeds from revolver
400,000
291,000
Principal payments on long-term debt
(1,009
)
(977
)
Change in zero balance cash accounts
(8,272
)
33,691
Financing fees paid for early debt redemption
(51
)
-
Payments for taxes related to net share settlement of equity awards
(46
)
(553
)
Deferred financing costs paid
(362
)
-
Net cash provided by financing activities
390,260
323,161
(Decrease) increase in cash and cash equivalents
(21,624
)
16,339
Cash and cash equivalents, beginning of period
157,151
39,721
Cash and cash equivalents, end of period
$
135,527
$
56,060
RITE AID CORPORATION AND SUBSIDIARIES SUPPLEMENTAL
SEGMENT OPERATING INFORMATION (Dollars in thousands) (unaudited)
Thirteen weeks endedJune 3, 2023 Thirteen weeks
endedMay 28, 2022
Retail Pharmacy Segment Revenues
(a)
$
4,492,329
$
4,345,356
Cost of revenues (a)
3,405,466
3,247,999
Gross profit
1,086,863
1,097,357
LIFO charge
7,500
-
FIFO gross profit
1,094,363
1,097,357
Adjusted EBITDA gross profit
1,098,268
1,106,652
Gross profit as a percentage of revenues
24.19
%
25.25
%
LIFO charge as a percentage of revenues
0.17
%
0.00
%
FIFO gross profit as a percentage of revenues
24.36
%
25.25
%
Adjusted EBITDA gross profit as a percentage of revenues
24.45
%
25.47
%
Selling, general and administrative expenses
1,172,573
1,117,214
Adjusted EBITDA selling, general and administrative expenses
1,028,219
1,032,970
Selling, general and administrative expenses as a percentage of
revenues
26.10
%
25.71
%
Adjusted EBITDA selling, general and administrative expenses as a
percentage of revenues
22.89
%
23.77
%
Cash interest expense
61,767
45,244
Non-cash interest expense
3,453
2,875
Total interest expense
65,220
48,119
Adjusted EBITDA
70,049
73,682
Adjusted EBITDA as a percentage of revenues
1.56
%
1.70
%
Pharmacy Services Segment Revenues (a)
$
1,196,154
$
1,725,857
Cost of revenues (a)
1,104,491
1,626,485
Gross profit
91,663
99,372
Gross profit as a percentage of revenues
7.66
%
5.76
%
Adjusted EBITDA
21,666
26,448
Adjusted EBITDA as a percentage of revenues
1.81
%
1.53
%
(a) - Revenues and cost of revenues include $35,321 and
$56,630 of inter-segment activity for the thirteen weeks ended June
3, 2023 and May 28, 2022, respectively, that is eliminated in
consolidation. RITE AID CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION RECONCILIATION OF NET LOSS TO ADJUSTED
EBITDA (In thousands) (unaudited) Thirteen
weeks endedJune 3, 2023 Thirteen weeks endedMay 28, 2022
Reconciliation of net loss to adjusted EBITDA: Net loss
$
(306,718
)
$
(110,191
)
Adjustments: Interest expense
65,220
48,119
Income tax expense
1,493
3,497
Depreciation and amortization
65,895
70,073
LIFO charge
7,500
-
Facility exit and impairment charges
20,001
66,571
Goodwill and intangible asset impairment charges
151,500
-
Stock-based compensation expense
1,081
3,334
Restructuring-related costs
78,130
22,646
Inventory write-downs related to store closings
2,057
7,955
Litigation and other contractual settlements
11,050
18,271
Gain on sale of assets, net
(8,193
)
(29,196
)
Other
2,699
(949
)
Adjusted EBITDA
$
91,715
$
100,130
Percent of revenues
1.62
%
1.66
%
RITE AID CORPORATION AND SUBSIDIARIES SUPPLEMENTAL
INFORMATION ADJUSTED NET LOSS (Dollars in thousands, except per
share amounts) (unaudited) Thirteen weeks endedJune
3, 2023 Thirteen weeks endedMay 28, 2022 Net loss
$
(306,718
)
$
(110,191
)
Add back - Income tax expense
1,493
3,497
Loss before income taxes
(305,225
)
(106,694
)
Adjustments: Amortization expense
17,133
20,626
LIFO charge
7,500
-
Goodwill and intangible asset impairment charges
151,500
-
Restructuring-related costs
78,130
22,646
Litigation and other contractual settlements
11,050
18,271
Adjusted loss before income taxes
(39,912
)
(45,151
)
Adjusted income tax expense (a)
195
1,490
Adjusted net loss
$
(40,107
)
$
(46,641
)
Adjusted net loss per diluted share: Numerator for
adjusted net loss per diluted share: Adjusted net loss
$
(40,107
)
$
(46,641
)
Denominator: Basic and diluted weighted
average shares
55,179
54,348
Net loss per diluted share
$
(5.56
)
$
(2.03
)
Adjusted net loss per diluted share
$
(0.73
)
$
(0.86
)
(a) The fiscal year 2024 and 2023 adjustments
to the income tax provision include adjustments to the GAAP basis
tax provision commensurate with non-GAAP adjustments and certain
discrete tax items, when applicable, was used for the thirteen
weeks ended June 3, 2023 and May 28, 2022. RITE AID
CORPORATION AND SUBSIDIARIES SUPPLEMENTAL INFORMATION
RECONCILIATION OF ADJUSTED EBITDA GROSS PROFIT AND RECONCILIATION
OF ADJUSTED EBITDA SELLING, GENERAL AND ADMINISTRATIVE EXPENSES-
RETAIL PHARMACY SEGMENT (In thousands) (unaudited)
Thirteen weeks endedJune 3, 2023 Thirteen weeks endedMay 28,
2022 Reconciliation of adjusted EBITDA gross profit:
Revenues
$
4,492,329
$
4,345,356
Gross Profit
1,086,863
1,097,357
Addback: LIFO charge
7,500
-
Depreciation and amortization (cost of goods sold portion only)
2,642
2,893
Other
1,263
6,402
Adjusted EBITDA gross profit
$
1,098,268
$
1,106,652
Percent of revenues
24.45
%
25.47
%
Reconciliation of adjusted EBITDA selling,
general and administrative expenses: Revenues
$
4,492,329
$
4,345,356
Selling, general and administrative expenses
1,172,573
1,117,214
Less: Depreciation and amortization (SG&A portion only)
52,827
53,215
Stock-based compensation expense
723
3,102
Restructuring-related costs
76,469
17,371
Litigation and other contractual settlements
11,050
9,952
Other
3,285
604
Adjusted EBITDA selling, general and administrative expenses
$
1,028,219
$
1,032,970
Percent of revenues
22.89
%
23.77
%
Adjusted EBITDA
$
70,049
$
73,682
RITE AID CORPORATION AND SUBSIDIARIES SUPPLEMENTAL
INFORMATION RECONCILIATION OF NET LOSS GUIDANCE TO ADJUSTED EBITDA
GUIDANCE YEAR ENDING MARCH 2, 2024 (In thousands) (unaudited)
Guidance Range Low High
Total Revenues
$
22,600,000
$
23,000,000
Pharmacy Services Segment Revenues
$
4,550,000
$
4,650,000
Gross Capital Expenditures
$
175,000
$
175,000
Reconciliation of net loss to adjusted EBITDA: Net
loss
$
(678,500
)
$
(651,500
)
Adjustments: Interest expense
273,000
273,000
Income tax expense
2,000
5,000
Depreciation and amortization
280,000
280,000
LIFO charge
30,000
30,000
Facility exit and impairment charges
100,000
100,000
Goodwill and intangible asset impairment charges
151,500
151,500
Restructuring-related costs
155,000
155,000
Litigation and other contractual settlements
11,000
11,000
Gain on sale of assets, net
(9,000
)
(9,000
)
Other
15,000
15,000
Adjusted EBITDA
$
330,000
$
360,000
RITE AID CORPORATION AND SUBSIDIARIES SUPPLEMENTAL
INFORMATION RECONCILIATION OF NET LOSS GUIDANCE TO ADJUSTED NET
LOSS GUIDANCE YEAR ENDING MARCH 2, 2024 (In thousands) (unaudited)
Guidance Range Low High
Net loss
$
(678,500
)
$
(651,500
)
Add back - income tax expense
2,000
5,000
Loss before income taxes
(676,500
)
(646,500
)
Adjustments: Amortization expense
68,000
68,000
LIFO charge
30,000
30,000
Goodwill and intangible asset impairment charges
151,500
151,500
Restructuring-related costs
155,000
155,000
Litigation and other contractual settlements
11,000
11,000
Adjusted loss before adjusted income taxes
(261,000
)
(231,000
)
Adjusted income tax expense
2,000
5,000
Adjusted net loss
$
(263,000
)
$
(236,000
)
Diluted adjusted net loss per share
$
(4.78
)
$
(4.29
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230628911516/en/
INVESTORS: Byron Purcell (717) 975-3710 investor@riteaid.com
MEDIA: Joy Errico (203) 970-5559 press@riteaid.com
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