Tuesday June 1, 9:24 am Eastern Time
Company Press Release
Rite Aid Files Annual Report, Form 10-K With
Securities and Exchange Commission
CAMP HILL, Pa.--(BUSINESS WIRE)--June 1, 1999--Rite Aid Corporation (NYSE:RAD - news; PSE:RAD), announced today that its Annual Report, Form 10-K for the fiscal year ended February 27, 1999, was filed this morning with the Securities and Exchange Commission.
Audited net earnings for the full year were reduced by $14.3 million or $0.05 per share as compared to unaudited results, announced on March 29, 1999. Net income increased by $0.6 million in the fourth quarter, decreased by $6.3 million in the third quarter, increased by $3.9 million in the second quarter, and was reduced by $12.6 million in the first quarter.
These significant adjustments to fiscal 1999 financial results are summarized as follows:
The company reclassified to operating expense, $32.7 million of capitalized project costs related to store planning, real estate development, construction and other costs.
$32.8 million was added to the closed store reserve for stores that were closed during fiscal 1999, but not included in the second quarter store closing charge.
The charge taken during the second quarter was reduced by $56.8 million as follows:
(a) Favorable lease terminations, (b) 26 stores which had been planned for closing but were not, and (c) other miscellaneous
cost changes.
Certain costs in the amount of $25.7 million were adjusted to operating expense from acquisition related accruals.
Certain expenses were increased to reflect reductions in estimates made for unprocessed advertising and purchase term discounts and other accounting estimates amounting to $24.7 million.
Lastly, tax liabilities no longer required were reversed by $21.0 million in the fourth quarter.
Financial results for fiscal years 1998 and 1997 have also been restated in connection with a review by the staff of the Securities and Exchange Commission of a registration statement relating to debt securities previously sold by the company.
While the company has made all adjustments it considered necessary, additional adjustments may result as the review process is completed. The company does not believe that any such adjustments will have a material effect on its financial condition.
The effect of the adjustments made is as follows:
For fiscal 1998, net earnings were reduced from $316.4 million to $305.9 million or $0.04 per share. This adjustment takes into account the reversal of a gain on the sale of a closed distribution center and the addition of employee severance costs for the closing of another distribution center.
For fiscal 1997, net earnings before extraordinary losses
increased $0.01 in diluted earnings per share.
The company is making no changes to its guidance for fiscal 2000 earnings per share expectations.
Rite Aid is one of the nation's largest drugstore chains with annual revenues of more than $12 billion and 3,821 stores, for the
fiscal year ended February 27, 1999. The Camp Hill-based company operates in 30 states and the District of Columbia.
General information about Rite Aid, including the annual report, corporate background and press releases, is available through
the company's web site at www.RITEAID.com.
This press release contains forward-looking statements 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 final audit
adjustments, as well as the other factors that typically could cause the company's results to differ from those expressed or
implied in forward-looking statements. Additional factors could include competitive pricing pressures, third party prescription
reimbursement levels, continued consolidation of the drugstore industry, consumer preferences, regulatory changes governing
pharmacy practices, general economic conditions, inflation, merchandise supply constraints, interest rate movements, access to
capital, availability of real estate, construction and start-up of drugstore and distribution center facilities, and the effects of
technological difficulties including remediation of year 2000 compliance issues. 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. |
