RAD Rite Aid Corp

Rite Aid Corp. said profit in its latest quarter plummeted as the drugstore chain integrated recently acquired Envision Pharmaceutical Services and recorded a loss on retired debt.

Meanwhile, the Camp Hill, Pa.-based company further cut its earnings outlook for the year, reflecting sales trends and additional expenses stemming from the recent acquisition.

Shares in the company, up about 15% this year through Wednesday's close, dropped 5.6% premarket.

Rite Aid is the nation's third-largest drugstore chain behind Walgreen Co. and CVS Caremark Corp.

The chain, like its rivals, has adjusted its offerings in an effort to broaden its business model as the pharmacy and drugstore industry expands into the health and wellness sector. In June, Rite Aid completed its tie-up with pharmacy benefit manager EnvisionRx, which it bought from investment firm TPG for about $2 billion.

Rite Aid Chief Executive John Standley said EnvisionRx made positive contributions during the quarter and helped sales at drugstores stores open at least a year rise 2.1%. Same-store pharmacy sales rose 2.8%, andfront-end sales edged 0.3% higher. The pharmacy segment has been under pressure from generic drugs, which shaved about two percentage points off second-quarter pharmacy sales, the company said.

Overall, Rite Aid reported a profit of $21.5 million, or 2 cents a share, down from $129.2 million, or 13 cents a share, a year earlier. The result included a $33.2 million loss on retired debt in addition to costs associated with the EnvisionRx merger.

Adjusted Ebitda, or earnings before interest, taxes, depreciation and amortization, was $346.8 million, down from $364.2 million a year earlier.

Revenue grew 18% to $7.66 billion.

Analysts projected 4 cents in earnings per share and $7.57 billion in sales, according to Thomson Reuters.

For the year, the drugstore chain now anticipates earnings of 12 cents to 19 cents a share, down from earlier guidance of 14 cents to 22 cents a share, on $30.8 billion to $31.1 billion in revenue.

Write to Lisa Beilfuss at lisa.beilfuss@wsj.com

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(END) Dow Jones Newswires

September 17, 2015 08:15 ET (12:15 GMT)

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