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09 Mar 2010 —  Duane Reade Announces Q4 2009 Results: Net Revenues Up 0.1%

Duane Reade reported total revenue for Q4 2009 of USD 465.0 million, a 0.1% increase over numbers reported for the comparable Q4 2008 period.  

Q4 2009 & Fiscal Year-End Operating Highlights

  • Net retail sales excluding pharmacy resale activity increased 5.3% to USD 451.3 million compared to the prior-year period.
  • Same store sales increased 2.6%.
  • Front-end sales increased 3.5%, benefiting from positive sales growth in food, beverage, and OTC categories.
  • Front-end same store sales increased 0.05%.
  • Pharmacy sales grew 7.7%, accounting for 45.9% of total sales.
  • Pharmacy same store sales increased 6.0%, with same store average weekly prescriptions filled increasing 4.0%.
  • Gross profit as a percentage of net revenues increased 140 bp at 31.5% year over year, benefiting from improved merchandising, increased private label penetration, and shrink reduction.
  • Operating expenses as a percentage of net revenues increased 40 bp to 26.7%, excluding pharmacy resale activity operating expenses decreased 1.0% to 27.5%.
  • Operating loss decreased to USD 1.437 million compared to USD 3.637 million in Q4 2008.
  • Net loss increased to USD 84,808 million, up from USD 17,379 million in the prior-year period due largely to fair value charged for the preferred stock’s mandatory redemption feature.

Fiscal year-to-date revenues grew 3.6% to USD 1.837 billion.

  • Same store sales increased 1.5%.
  • Front-end sales increased 2.4%.
  • Front-end same store sales decreased 0.8%.
  • Pharmacy sales grew 5.0%, accounting for 46.7% of total sales.
  • Pharmacy same store sales grew 4.6%.
  • Gross profit percentage decreased 20 bp to 31.0%.
  • Operating expenses percentage decreased 20 bp to 26.7%.
  • Operating loss decreased to USD 7,632 million compared to USD 15,818 million in fiscal 2008.
  • Net loss increased to USD 124,296 million, up from USD 72,778 million in the prior-year period.

On February 17, 2010, Duane Reade entered an agreement to be acquired by Walgreens for USD 1.075 billion. Walgreens expects the transaction to be completed by the end of its fiscal year: August 31, 2010.

As of December 26, 2009, the retailer operated 257 stores throughout the New York City Metropolitan area.