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Flu season drives Longs’ January sales

BY Doug Desjardins

WALNUT CREEK, Calif. A higher incidence of flu helped Longs Drugs rebound in January but it wasn’t enough to offset weak sales in December. That’s according to a report from Goldman Sachs analyst John Heinbockel, who said the firm was lowering its earnings forecast for fourth-quarter sales by $17 million to reflect “weaker sales earlier in the quarter.”

The 510-store chain reported a 1 percent increase in same-store sales for January, with pharmacy rising 1.2 percent and front-end sales jumping 0.7 percent. Heinbockel said the improvement “was driven primarily by a snapback in flu incidence, with both pharmacy and front-end sales gaining momentum.” He expects to see “further improvement in February (driven by a month of stronger flu) and March.”

Longs’ preliminary results for the fourth quarter ended Jan. 31 showed total sales increased 9.1 percent to $1.34 billion. Same-store sales dropped 0.6 percent, with pharmacy sales rising 0.7 percent and front-end sales falling 1.7 percent. Preliminary results for its full year show total sales increasing 4.9 percent to $4.88 billion and same store sales jumping 0.9 percent. Longs will report its fourth-quarter and full-year earnings on March 5.

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Wal-Mart inks deal to open in-store clinics in 200-plus locations

BY Antoinette Alexander

BENTONVILLE, Ark. Wal-Mart has announced that it will open in April its first co-branded in-store health clinic in Atlanta, Little Rock and Dallas, paving the way toward having 400 co-branded clinics by 2010.

“We know that America’s healthcare challenges are larger than any one corporation, but we’re committed to doing our part to expand access to quality, affordable health care—our commitment to partnering with local hospital systems is evidence,” stated John Agwundobi, Wal-Mart’s senior vice president and president of health and wellness. “Throughout our convenient clinics pilot, customers told us that we are providing a service that benefits their communities. We are confident that our new model of partnership with hospital systems will provide access to quality healthcare services for folks who don’t want to wait in a busy emergency room or can’t get in to see their physician.”

There currently are 77 limited-scope medical clinics open in Wal-Mart stores across 12 states through several partnerships with independent healthcare clinic operators. As widely reported, walk-in clinic operator CheckUps recently closed 23 clinics in Wal-Mart in four southern states.

Now, the big box retailer has inked a deal with clinic operator RediClinic and local hospital systems to open the co-branded clinics, dubbed The Clinic at Wal-Mart, in 200 Wal-Mart Supercenters. Wal-Mart also has signed a letter of intent to partner with St. Vincent Health System, a part of the Catholic Healthcare Initiatives system, to open four co-branded clinics in Little Rock.

Responding to the news, Citigroup analyst Deborah Weinswig said in a research note that she expects the move to drive new prescription customers and bolster front-end sales.

“Wal-Mart is giving operators a turnkey solution: offering a 500+ square foot clinic with all the bells and whistles. The operator will get major brand visibility and will not have to negotiate for space or location, deal with building permits, contractors of suppliers. Meanwhile, Wal-Mart can standardize the clinic experience no matter what store patients visit,” stated Weinswig.

She noted that she believes Wal-Mart is changing its retail clinic strategy on the heels of the closure of CheckUps by now requiring that clinic operators within its stores be either a hospital system or be closely affiliated with one.

The Clinic at Wal-Mart, owned and operated by St. Vincent Health System, is expected to open in Little Rock by the end of April, as will the clinic owned and operated by RediClinic in association with a local hospital system in Atlanta. By the summer, Wal-Mart expects to open co-branded clinics with RediClinic and a local hospital system in Dallas.

“Wal-Mart Supercenters are a great venue for RediClinic and its health care system partners because there are millions of customers in these stores every day who need easier access to the high quality, affordable health care that we provide,” stated Web Golinkin, chief executive officer of RediClinic.

The clinics operated by both RediClinic and St. Vincent plan to accept health insurance plans including Aetna, Humana, Blue Cross Blue Shield and others.

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HearAtLast opens 19th Canadian Wal-Mart location, names Mele to board of directors

BY Antoinette Alexander

TORONTO HearAtLast, an operator of hearing aid clinics, has opened its 19th location within a Wal-Mart store in Canada and appointed Louie Mele, president of McDonald’s Restaurants of Canada, to its board of directors.

The grand opening of the new location within the Airdrie, Alberta Wal-Mart Store is slated for Feb. 8. HearAtLast currently owns and operates 18 hearing clinics in Wal-Mart Stores, Wal-Mart Supercenters and Sam’s Clubs in Canada. It also recently opened its first free-standing clinic in the United States in the adult community The Villages, Florida.

Meanwhile, HearAtLast has appointed Mele to its board. McDonald’s Canada signed an agreement with Wal-Mart Canada in 1994, and today McDonald’s Canada is the largest licensee of Wal-Mart Canada with 200 satellite restaurants co-located within Wal-Mart stores throughout Canada.

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