Rite Aid monthly same-store sales improve
Camp Hill, Pa. – Rite Aid reported a slight boost in monthly same-store sales but a decreased in year-to-date same-store sales. For the four weeks ended June 29, 2013, same-store sales increased 0.7% from the prior-year period. June front-end same store sales increased 0.4%, while pharmacy same store sales increased 0.9% despite the negative impact of generics.
Total drugstore sales for the four-week period increased 0.2% to almost $1.93 billion. Prescription sales accounted for 67.4% of drugstore sales and third-party prescription sales represented 97% of pharmacy sales.
In addition, same-store sales for the 17-week period ended June 29, 2013 decreased 1.7% from the prior-year period. Front-end same-store sales increased 0.4% while pharmacy same-store sales decreased 2.7%.
Total drugstore sales for the 17 weeks ended June 29, 2013 decreased 2.1% with sales of $8.19 billion compared to $8.36 billion for the same period last year. Prescription sales represented 67.5% of total drugstore sales and third-party prescription sales represented 97% of pharmacy sales.
Former Walmart CFO helps clean up competitor’s mess
Longtime financial executive and former Walmart U.S. CFO Michael Fung is helping discounter 99 Cents Only modernize inventory systems that have resulted in a series of accounting issues.
Fung, 62, retired from Walmart in early 2012, but was called back into service this past January by the private equity owners of 99 Cents Only. Fung was named interim chief administrative officer at the company to oversee finance, information technology and real estate. In addition, 99 Cents Only board member and former Food Lion president and CEO Richard Anicetti was named interim CEO.
The timing of their appointments is noteworthy because about the time Fung left Walmart after 11 years in various finance roles, including CFO of Walmart U.S. for six year, 99 Cents only was being taken private for $22 a share by an unconventional mix of investors. The buyout partners included a group led by the Los Angeles-Based private equity firm Ares Management LLC, the Canada Pension Plan Investment Board and members of the company’s senior management team that included CEO Eric Schiffer, his father-in-law and founder David Gold and his son and president and COO Jeff Golf.
However, earlier this year Fung and Anicetti were brought in, Schiffer and the Golds departed and the reason why became apparent last week when the company disclosed in a filing with the Securities and Exchange Commission that is was unable to file its annual report on form 10-K in a timely manner for the fiscal year ended March 30.
At issue were a range of inventory valuation issues that caused the company to overstate the value of inventories by as much as $20 million, according to the filing. The company said it was unable to resolve the matter without unreasonable effort or expense and thus the reason for the delay.
To avoid future problems, 99 Cents Only is in the process of upgrading its systems for accounting for merchandise inventories, including implementation of an SAP system that will for the first time track inventory at each retail store on a perpetual basis by stock keeping unit. The SAP implementation process will begin in fiscal 2014, with all stores expected to be included by the end of fiscal 2015. Walmart implemented an SAP system during Fung’s tenure with the company.
In another development related to the changeover in management, beginning in the fourth quarter of fiscal 2013 the company also changed how it estimates its excess and obsolete inventory so that reserves include items that are at least 12 months old and are not expected to sell above cost within 12 months as opposed to the earlier method that involved a 24 month period. As a result of the change in estimates, the company expects to record a non-recurring charge to cost of sales and corresponding reduction in inventory of approximately $10 million in the fourth quarter of fiscal 2013.
Patriotic e-commerce site launches July 4
Orlando, Fla. – A new e-commerce site dedicated to products manufactured in America, MadeInTheUSA.com, launches July 4. The site will feature nearly 1 million products made in the U.S. across all major categories.
“When consumers buy American, the money stays here and keeps our friends and neighbors working," said Don Buckner, CEO of MadeInTheUSA.com. "With heightened public awareness about the benefits of recycling American dollars, there is an opportunity to stimulate the economy and create jobs. In other words, the power of change is in our pockets."
The site has operated as a directory of American manufacturers since 1996. Buckner decided to turn it into a full-fledged e-commerce operation in March of this year.