Duane Reade beats estimates

Drug Store News,  May 20, 2002  by Antoinette Alexander

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NEW YORK -- Duane Reade reported that first quarter earnings, excluding a one-time charge, beat analysts' expectations, while front-end same-store sales fell 1.3 percent. "I think the quarter unfolded very much like our guidance has indicated," Anthony Cuti, chairman and chief executive officer, told analysts in a conference call late last month.

Net income totaled $5.3 million, or 22 cents per diluted share, before a previously disclosed one-time charge. Wall Street's consensus earnings estimate was 21 cents per share, according to Thomson Financial/First Call.

Same-store sales rose 5.3 percent. Pharmacy sales rose 15.8 percent. Total sales rose 12.5 percent to $305.8 million.

Citing the changed market conditions in New York City following Sept. 11, Duane Reade reported a 1.3 percent decline in same-store front-end sales.

"The New York market continues to improve steadily ... which should in turn have a positive impact on the sales trends in our business," said Cuti.

For the second quarter, the retailer anticipates achieving sales of about $335 million and expect earnings per share will range from 40 cents to 44 cents. For the full-year, the retailer expects revenue growth of 15 percent to 18 percent.

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