Rite Aid — Q1 FY2019 Earnings Presentation
21 slides from Rite Aid's earnings presentation, Jun 27, 2018
Slide 1: Q1 Fiscal 2019 Supplemental Information
PHARMACY With us, its personal. 1S™ QUARTER FISCAL 2019 SUPPLEMENTAL INFORMATION June 27, 2018
Slide 2: Cautionary Statement Regarding Forward Looking Statements
Cautionary Statement Regarding Forward Looking Statements Statements in this presentation that are not historical, are forward - looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 . Such statements include, but are not limited to, s
Slide 3: Additional Information and Where to Find It
Additional Information and Where to Find It In connection with the Merger involving Rite Aid and Albertsons, Rite Aid and Albertsons have prepared and Albertsons has filed with the SEC on June 25 , 2018 a definitive registration statement on Form S - 4 that includes a proxy statement of Rite Aid tha
Slide 4: Cautionary Note Regarding Pro Forma Information
Cautionary Note Regarding Pro Forma Information : The following presentation provides certain pro forma information regarding the impact of Rite Aid’s proposed sale of stores and assets to Walgreens Boots Alliance, Inc . on Rite Aid’s results of operations and capital structure . The pro forma infor
Slide 5: Non-GAAP Financial Measures
Non - GAAP Financial Measures The following presentation includes the non - GAAP financial measures, Adjusted EBITDA, Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Diluted Share, Pro Forma Adjusted EBITDA, Adjusted EBITDA Gross Profit and Adjusted EBITDA SG&A . Rite Aid defines Adjusted
Slide 6: Q1 Fiscal 2019 Summary
Revenue 5,388.5$ 5,436.5$ Net Loss (41.7)$ (36.1)$ Net Loss per Diluted Share (0.04)$ (0.03)$ Adjusted Net Loss per Diluted Share (0.01)$ (0.01)$ Adjusted EBITDA 147.3$ 2.73% 136.0$ 2.50% Pro Forma Adjusted EBITDA 147.3$ 160.0$ 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Q1 - Fiscal 2019
Slide 7: Q1 Fiscal 2019 Summary: Total Company
Net Income/(Loss) 214.4$ (75.3)$ Net Income/(Loss) per Diluted Share 0.20$ (0.07)$ 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Q1 - Fiscal 2019 Summary ($ in millions, except per share amounts) TOTAL COMPANY
Slide 8: Q1 Fiscal 2019 Reconciliation of Net Loss to Adjusted EBITDA
Q1 - Fiscal 2019 Reconciliation of Net Loss to Adjusted EBITDA ($ in thousands) 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Net Loss - Continuing Operations (41,727)$ (36,037)$ Adjustments: Interest expense 62,792 51,000 Income tax benefit (9,497) (12,121) Depreciation and amortization 9
Slide 9: Q1 Fiscal 2019 Reconciliation of Net Loss to Adjusted Net Loss
Q1 - Fiscal 2019 Reconciliation of Net Loss to Adjusted Net Loss ($ in thousands, except per share amounts) 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Net Loss $ (41,727) $ (36,037) Add back - Income tax benefit (9,497) (12,121) Loss before income taxes (51,224)$ (48,158)$ Adjustments:
Slide 10: Q1 Fiscal 2019 Summary: Retail Pharmacy Segment
Revenue 3,897.8$ 3,972.4$ Adjusted EBITDA Gross Profit (1) 1,093.4$ 28.05% 1,081.1$ 27.22% Adjusted EBITDA SG&A (1) 979.9$ 25.14% 993.7$ 25.02% Adjusted EBITDA 113.5$ 2.91% 87.4$ 2.20% 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Q1 - Fiscal 2019 Summary RETAIL PHARMACY SEGMENT ($ in mill
Slide 11: Q1 Fiscal 2019 Summary: Retail Pharmacy Segment
Q1 - Fiscal 2019 Summary RETAIL PHARMACY SEGMENT Retail Pharmacy Segment revenue decreased $74.6 million or 1.9% due to store closures and a decline in same store sales. Same store sales decreased 0.7%, driven by a 1.5% decrease in comparable script growth, due primarily to exclusion from certain ph
Slide 12: Reconciliation of Adjusted EBITDA Gross Profit
Reconciliation of Adjusted EBITDA Gross Profit RETAIL PHARMACY SEGMENT ($ in thousands) 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Revenues 3,897,765$ 3,972,351$ Gross Profit 1,069,457 1,056,971 Addback: LIFO charge 9,966 10,173 Customer loyalty card program revenue deferral 9,340 9,914
Slide 13: Reconciliation of Adjusted EBITDA SG&A
Reconciliation of Adjusted EBITDA SG&A RETAIL PHARMACY SEGMENT ($ in thousands) 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Total Revenues 3,897,765$ 3,972,351$ Selling, general and administrative expenses 1,064,387 1,082,041 Less: Depreciation and amortization (SG&A portion only) 69,666
Slide 14: Pharmacy Services Segment Results
Pharmacy Services Segment Results ($ in millions) 13 Weeks Ended June 2, 2018 13 Weeks Ended June 3, 2017 Revenues 1,542.8$ 1,513.2$ Cost of Revenues 1,443.5 1,408.3 Gross Profit 99.3 104.9 Selling, General and Administrative Expense (88.2) (78.9) Addback: Depreciation and Amortization 22.5 22.5 Oth
Slide 15: Q1 FY 2019 Summary: Pharmacy Services Segment
Q1 - FY 2019 Summary PHARMACY SERVICES SEGMENT Revenues increased $29.6 million, primarily due to an increase in our Medicare Part D membership. Adjusted EBITDA decreased $14.6 million, primarily due to margin compression in our commercial business and SG&A investments we have made to support our cu
Slide 16: Comparable Store Sales Growth
5.0% 3.3% 1.8% 0.5% 0.4% - 3.4% - 4.0% - 4.7% - 5.5% - 4.9% - 3.5% - 2.3% - 0.1% FY 18 FY 16 FY 17 FRONT END SALES RX SALES SCRIPT COUNT 3.6% 2.0% 2.0% 2.5% 2.8% 0.2% - 0.4% - 0.1% - 1.1% - 2.0% - 2.4% - 1.8% - 1.5% (1) (1) Script count growth shown on a 30 - day equivalent basis. Comparable Store S
Slide 17: Capitalization Table
Capitalization Table ($ in thousands) Note: Debt in the capitalization table is shown net of unamortized debt issuance costs. June 2, 2018 March 3, 2018 Secured Debt: Senior secured revolving credit facility due January 2020 179,742$ (13,076)$ Other 90 90 179,832 (12,986) Unsecured Guaranteed Debt:
Slide 18: Pro Forma Leverage Ratio
Pro Forma Leverage Ratio ($ in thousands) June 2, 2018 Total Debt 3,182,603$ Less: cash and cash equivalents 147,092 Net Debt 3,035,511$ Adjusted EBITDA Retail Pharmacy Segment - Pro Forma for TSA Fees 478,064 Pharmacy Services Segment 156,798 Adjusted EBITDA 634,862$ Leverage Ratio 4.78 CONTINUING
Slide 19: FY 2019 Guidance
FY 2019 Guidance ($ in thousands) Low High Total revenues 21,700,000$ 22,100,000$ Same store sales 0.00% 1.00% Gross capital expenditures 250,000$ 250,000$ Reconciliation of net loss to adjusted EBITDA: Net loss (95,000)$ (40,000)$ Adjustments: Interest expense 210,000 210,000 Income tax benefit (15
Slide 20: FY 2019 Guidance (cont.)
FY 2019 Guidance (cont.) ($ in thousands, except per share amounts) Low High Net loss $ (95,000) $ (40,000) Add back - Income tax benefit (15,000) (10,000) Loss before income taxes (110,000) (50,000) Adjustments: Amortization of EnvisionRx intangible assets 85,000 85,000 LIFO charge 35,000 35,000 Lo
Slide 21: Important Notice Regarding Forward-Looking Statements
Important Notice Regarding Forward-Looking Statements This communication contains certain “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, both as amended by the Private Securities Litigation Reform Act of 1995. Statements that ar