In October, Fred’s recorded a sales decrease of 4.2% to $157.3 million as comparable store sales slipped 3.4%.
Sales for the third quarter of 2016 decreased 4.5% to $516.7 million as comps declined 3.8%.
Michael Bloom, Fred’s CEO, said, “While we continue to make broad progress in addressing the issues that have affected our sales over the past several months, these improvements were obscured primarily by four discrete factors in October that prevented us from hitting our sales expectations for the month. In the front store, we encountered unexpected challenges in our transition to a third-party distributor for several key categories. October sales also were affected by the calendar shift for Halloween, which pushed the holiday into the fiscal month of November this year versus October last year. Significant reductions in SNAP payments and warmer-than-expected weather during the month also contributed to October’s sales decline. Retail pharmacy sales continued to be pressured by the ongoing shift to 90-day prescriptions, as expected, but our specialty pharmacy sales, while still running below last year’s level, gained further ground in October with month-over-month growth. Outside of these headwinds, which we consider to be transitory, as well as the tough comparisons we have faced against last year’s sales, we remain confident in the strategic path for Fred’s. With the key initiatives we have in place to drive future growth and improve profitability, we continue to make bold strategic shifts in our business.”
Fred’s and its subsidiaries operate 648 discount general merchandise stores and three specialty pharmacy-only locations in 15 of the United States, primarily in the southeast.
