Q3 2013 Earnings Call Transcript

Transcript Call Date 12/20/2012

Operator: Good morning. My name is Felicia and I will be your conference operator today. At this time, I would like to welcome everyone to the Rite Aid Third Quarter Fiscal 2013 Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

Thank you. Mr. Matt Schroeder, you may begin.

Matt Schroeder - Group VP, Strategy, IR and Treasurer: Thank you, Felicia, and good morning, everyone. We welcome you to our third quarter conference call. On the call with me are John Standley, our Chairman, President and Chief Executive Officer; Ken Martindale, our Chief Operating Officer; and Frank Vitrano, our Chief Financial and Chief Administrative Officer.

On today's call, John will give an overview of our third quarter results and discuss our business. Ken will give an update on some of our key initiatives. Frank will discuss the key financial highlights and fiscal 2013 outlook, and then we will take questions.

As we mentioned in our release, we are providing slides related to the material we will be discussing today. These slides include annual earnings and sales guidance. These slides are provided on our website, www.riteaid.com under the Investor Relations Information tab for conference calls. This guidance is a point-in-time estimate and the Company expressly disclaims any current intention to update it.

This conference call and the related slides will be available on the Company's website until the next earnings call unless the Company withdraws them earlier and should not be relied upon thereafter. We will not be referring to the slides directly in our remarks, but hope you'll find them helpful as they summarize some of the key points made on the call.

Before we start, I'd like to remind you that today's conference call includes certain forward-looking statements. These forward-looking statements are made in the context of certain risks and uncertainties that can cause actual results to differ. These risks and uncertainties are described in our press release in Item 1A of our most recent Annual Report on Form 10-K and other documents that we file or furnish to the Securities and Exchange Commission.

Also, we will be using a non-GAAP financial measure. The definition of the non-GAAP financial measure along with the reconciliations to the related GAAP measure, are described in our press release. Also included in our slides are the non-GAAP financial measures of adjusted EBITDA gross profit and adjusted EBITDA SG&A and the reconciliations of those measures to their respective GAAP financial measure.

With these remarks, I'd now like to turn it over to John.

John T. Standley - Chairman, President and CEO: Thank you, Matt, and thank you all for joining us this morning to review our third quarter results for fiscal 2013. During the quarter we reached a significant milestone in our turnaround efforts by earning net income of $61.9 million or $0.07 per diluted share compared to a net loss of $52 million or $0.06 per diluted share in the previous year's third quarter. In addition, we achieved a Company record of $295.3 million in adjusted EBITDA, an increase of nearly $74 million over the prior year period. This improvement was driven by increases in front sales and prescription counts as well as an improvement in pharmacy gross margin.

Read our Earnings Call Transcript disclaimer.
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