CAMP HILL - Superstorm Sandy and generic drugs teamed up to squeeze drugstore operator Rite Aid Corp.'s revenue from established stores last month.
The Camp Hill, Pa., company said Thursday that revenue from stores open at least year fell 3 percent in the five weeks that ended Dec. 1. That included a 4.2 percent decrease in pharmacy sales - even though the prescription count climbed 2.2 percent - and a drop of less than 1 percent from the front end, or the rest of the store.
Rite Aid said Superstorm Sandy, which swept through the East Coast in late October, hurt both front-end sales and its prescription count. In October, the company said Sandy had helped sales by motivating customers to visit its stores to stock up on supplies before it arrived. But Rite Aid also said then that it expected the storm to hurt results in November, as it forced many stores to close temporarily.
Generic drugs also hurt revenue for Rite Aid and other drugstore chains last month, as they have for the past several months. Several popular brand-name drugs lost U.S. patent protection last year, and their generic equivalents hurt revenue for drugstores because they cost less than the brand-name counterparts.
But those generics also boost profitability because they come with a wider margin between the cost for the pharmacy to purchase the drugs and the reimbursement it receives.
Rite Aid said total revenue for the five-week period fell more than 2 percent to about $2.4 billion. Prescription sales accounted for nearly 68 percent of that.
Weak consumer spending and aggressive growth from competitors like dollar stores also pressured drugstore sales in November, Credit Suisse analyst Edward J. Kelly said in a note late last month.
Rite Aid's total revenue for its fiscal third quarter, which ended Dec. 1, fell 2 percent to $6.21 billion. The company will release the rest of the results from that quarter on Dec. 20.
The third largest U.S. drugstore chain operated 4,633 stores as of Dec. 1. It trails both Walgreen Co. and CVS Caremark Corp.
Shares of Rite Aid slipped a penny to 98 cents per share in morning trading Thursday after falling as low as 97 cents earlier, its lowest level since September 2011.