Walgreens acquires Kerr Drug chain
Deerfield, Ill. — Walgreens on Tuesday announced it has acquired North Carolina pharmacy chain Kerr Drug. The purchase of the privately held regional outfit, which generated $381 million in revenue in 2012, includes its 76 retail stores and specialty pharmacy chain.
“The Kerr Drug retail drug stores and specialty pharmacy business are an exceptional addition to the Walgreens family of companies,” said Walgreens president and CEO Greg Wasson. “We are closely aligned on the important task of expanding the healthcare role that community pharmacists can have with their patients, and we share the common goal of stepping out of the traditional drugstore format to create a new experience for our customers.”
“Kerr Drug’s strategy and core principles have always been focused on its unique ability to provide patients access to the most comprehensive and convenient health and wellness offering in the industry," said Anthony Civello, Kerr Drug chairman, president and CEO. "Walgreens is the perfect partner to continue this journey as a patient-oriented company dedicated to expanding the role of the pharmacist as an integral part of health care.”
Financial terms of the agreement were not disclosed. As part of the transaction, which is slated to close later this year, Kerr Drug will maintain ownership of its long-term care pharmacy business.
Until the acquisition closes, Kerr Drug and Walgreens will continue to operate separately. After closing, the acquired Kerr Drug retail drug stores will continue to operate under their current brand in the near term.
Pep Boys remain cautiously optimistic following Q2 results
The Pep Boys are remaining cautiously optimistic that there will be an increase in demand for tires this year, following a comparable store sales decrease of 1.3% for the second quarter ended Aug. 3.
Sales for the quarter increased 0.4% to $527.6 million from $525.7 million for the prior-year quarter. The company’s operating profit for the quarter, adjusted to exclude merger-related costs, was $19.4 million as compared to $15.5 million for the second quarter of fiscal 2012.
Net earnings for the quarter were $5.4 million, or $0.10 per share, as compared to $33 million, or $0.61 per share, for the second quarter of fiscal 2012.
“Improved product gross margins drove our 25% improvement in adjusted operating income during the quarter,” said president and CEO Mike Odell. “Our strategically important maintenance and repair services remain steady and grew in customer count, sales and margin rate. Tire sales were down in dollars and units, but grew in gross margin dollars. While not yet realized, we continue to be cautiously optimistic that we will see improving demand for tires this year.”
The expansion of the company’s Service & Tire Centers continues with the acquisition of 17 locations in Southern California in September, bringing its total to 211. Each of the new locations will be converted to the company’s new Road Ahead format, designed with “a more welcoming curb appeal and a comfortable and appealing customer lounge,” according to Odell.
Pep Boys is a leading automotive aftermarket chain with approximately 7,400 service bays in more than 750 locations in 35 states and Puerto Rico. Pep Boys offers name-brand tires; automotive maintenance and repair; parts and expert advice for the Do-It-Yourselfer; commercial auto parts delivery; and fleet maintenance and repair.
Five Below is ‘solid’ in the second quarter
PHILADELPHIA — Five Below saw solid performance across most of its categories, resulting in a comparable store sales increase of 6.6% for the second quarter ended Aug. 3 and net sales of $117.1 million, a 34.9% jump from $86.8 million in the prior-year quarter.
The company opened 18 new stores and ended the quarter with 276 stores in 19 states. This represents an increase in stores of 22% from the end of the second quarter of fiscal 2012.
Operating income was $7.2 million as compared to $4.7 million in the prior-year quarter, while net income was $4.1 million compared to $1.2 million in the prior-year quarter.
"We are extremely pleased with our top and bottom line performance in the second quarter which once again illustrates the strong fundamentals of our business,” said Thomas Vellios, co-founder, president and CEO. “We saw solid performance across most of our categories reflecting the broad appeal of the Five Below concept, merchandise and value proposition."
Through the end of the second quarter, Five Below has opened 32 of its 60 planned net new stores for 2013. The company has recently entered into Texas with four stores, which opened in Austin during the last weekend of the second quarter, and is preparing to open 11 stores in Dallas Sept. 12, representing the largest grand-opening in its history.