Rite Aid Conference Call Highlights

Rite Aid Corporation (NYSE: RAD) recently reported its third quarter earnings on Thursday. Shares of the company are up 11.8 percent.

Below are some key highlights from its conference call.

• A key highlight was our 5.4% increase in total same-store sales, which was driven by a 4.5% increase in same-store prescription count.
• Continuing the trends we've seen throughout the year, our script count was fueled by higher utilization in Medicaid expansion states and the success of our various pharmacy initiatives.
• We also benefited from an increase in flu shots administered during the quarter.
• As we generated top line momentum, we also did a good job of managing expenses to effectively leverage our sales increase and drive gross profit.
• These factors helped us to achieve net income of $104.8 million and adjusted EBITDA of $332.8 million, both of which are solid increases over the prior year period.
• We've exceeded 3 million flu shots for the year and we continue to work diligently to engage our patients as we educate them about the value of this convenient health and wellness service.
• Our third quarter results reflect strong script count and front-end trends, improvements in gross profit, good cost control and continued progress on our business initiatives.
• Revenue for the quarter was $6.7 billion which was $335 million or 5.3% higher than last year's third quarter. The increase was primarily due to higher pharmacy sales.
• Overall, same-store sales increased 5.4% in the quarter which was driven mostly by a higher pharmacy script count.
• Front-end same-store sales increased by 1.6%. Pharmacy same-store sales were higher by 7.2% which included an approximate 228 basis point negative impact from new generic drugs.
• Total gross profit dollars in the quarter were $122.6 million better than last year's third quarter and 42 basis points higher as a percent of revenues.
• We expect free cash flow to be in a range of $325 million to $375 million for the year