Rite Aid Marks First Profit Since 2008

[Alpha8472]

Rite Aid reported net income of $61.9 million during the fiscal third quarter ending December 1.

It seems like Rite Aid's luck is finally turning around. Of the three main drug store chains, I have to admit that Rite Aid seems to be the low price leader overall. Walgreens is expensive like a convenience store. CVS has high regular prices and some decent sales. However, I find that CVS doesn't have nearly enough good sales. The items that you need most are not always on sale.

Rite Aid needs to invest a little more on remodeling their stores. The new Wellness decor is actually quite good looking. The remodeled Wellness stores are bound to have increased sales.

[Brian Lutz]

Some time ago, I can recall seeing Rite Aid on someone's list of companies that wouldn't survive through 2010, so it's nice to see them be able to turn things around. And I do agree that the newer Rite Aids around here are actually quite nice, but the vast majority of stores here are still mostly acquired Pay 'n Save \ Payless Drug stores that look seriously dated even with the current Rite Aid design package and make you wonder how they can manage to be profitable enough to keep operating. There are a number of Bartell Drugs locations that have been around just as long as some of the Rite Aids, and although there's nothing particularly spectacular about the Bartell stores, they all seem a lot better maintained than the older Rite Aids are.

[Super S]

Some Rite Aid stores still have not been remodeled since they were PayLess Drug. 14 years, or in some cases, much longer than that.

[submariner]

Rite Aid has had a few "new decors" since the 90's pastel that seems to still be overwhelmingly dominant. I'll save judgement.

Interesting though that they've "humanized" the pharmacy by making the signage read "Pharmacist" instead of "Pharmacy".

[storewanderer]

I think it is more Rite Aid is lucky that Walgreens had such a mess with Express Scripts. Also, to a lesser extent, they have had some benefit from upset former Longs customers who did not like the changes CVS made and went looking for a new drugstore. Also, although this is meaningless to me and a lot of other customers too, I do think their loyalty card offering has helped translate some prescription only customers into people who also use the front end once they fill enough to get the 10-20% store discounts. That observation is based solely on watching customers in some of their stores.

Still this is a big milestone for them. It brings their financial performance back to where it was before the Eckerd transaction. Hopefully they can continue to limp along and slowly pay down their debt. It is more about the debt being too much for the stores to pay off, than the stores being unprofitable... the stores do fine, there is just too much debt...

[Alpha8472]

Rite Aid's rewards card is the one thing that has kept me coming back to the store. The coupons that print out on your receipt for $3 off your next purchase are as good as cash and you know I'm not going to let those coupons go to waste.

I don't really like Walgreens rewards card. You earn points, but the payoff is far too distant. With Rite Aid you can get cash for your next purchase and you don't have to wait several months.

Walgreens lost so many customers when they stopped accepting Express Scripts insurance. When those people switched to other pharmacies, they realized how how high priced and awful Walgreens was as a store.

Longs Drugs was a trusted name and people loved their stores. When CVS got rid of the name, there was so much hatred at the loss of the trusted Long Drugs brand that people revolted and practically boycotted CVS. When Rite Aid took over Payless and Thrifty, there wasn't much backlash as Payless and Thrifty were pretty rundown stores at the time. Rite Aid kept the Thrifty Ice Cream counters and kept the Thrifty and Payless decor for some time.

[Super S]

Rite Aid's rewards card is the one thing that has kept me coming back to the store. The coupons that print out on your receipt for $3 off your next purchase are as good as cash and you know I'm not going to let those coupons go to waste.

I don't really Walgreens rewards card. You earn points, but the payoff is far too distant. With Rite Aid you can get cash for your next purchase and you don't have to wait several months.

Walgreens lost so many customers when they stopped accepting Express Scripts insurance. When those people switched to other pharmacies, they realized how how high priced and awful Walgreens was as a store.

Longs Drugs was a trusted name and people loved their stores. When CVS got rid of the name, there was so much hatred at the loss of the trusted Long Drugs brand that people revolted and practically boycotted CVS. When Rite Aid took over Payless and Thrifty, there wasn't much backlash as Payless and Thrifty were pretty rundown stores at the time. Rite Aid kept the Thrifty Ice Cream counters and kept the Thrifty and Payless decor for some time.

Rite Aid did not exactly receive a warm welcome in the Northwest. Rite Aid decided to quietly implement a rewards card right off the bat with little notice, this was before Safeway and others started this. Signage in the store was not marked that a card was required, and I remember one instance within a month of Rite Aid taking over, having a cart full of merchandise, where I was rudely told I "had to have a card" to buy anything on sale, and they did not have any forms for the card so I could not get the sale price. Needless to say, after some arguing I walked out and left that entire cart behind. Also, A LOT of former Payless stores closed with no replacement (mainly in smaller towns), those which remained open have only recently been remodeled. Some have still not been remodeled to this day, and have shelves blocking off areas of the larger stores. The older stores had a role as a general merchandise type of store, and Walmart wasn't a factor when PayLess was still operating them, so they used to be fairly well stocked until Rite Aid took over.

I also remember a news story from the first year or two of Rite Aid's takeover, where they frequently and regularly were making mistakes with prescriptions. I personally know people who stayed away from Rite Aid because of that.

Walgreens has been aggressively expanding and building new stores, while Rite Aid has mainly stuck to areas with a former PayLess presence, and has only built a handful of new locations in the region. However, I will say that Rite Aid has done a nice job remodeling some of them, such as the 1960s era Pay'N'Save/PayLess in Longview's Triangle Center.

[norcalriteaidclerk]

Apparently,that first quarterly profit was no fluke:they just recorded a second consecutive profitable quarter.I wonder how long it's been since they've recorded a string of profitable quarters...