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Shoppers Drug Mart announces Q3 earnings up

BY Michael Johnsen

TORONTO Shoppers Drug Mart Corp. on Tuesday posted a third-quarter net earnings increase of 15.1 percent, to $155.7 million, for the 16 weeks ending Oct. 6.

Sales in the third quarter were $2.8 billion, representing an increase of 9.2 percent. On a same-store basis, sales increased 5.3 percent, with overall prescription sales increasing 8.9 percent in the third quarter to $1.3 billion, accounting for 47.8 percent of the company’s sales mix. Prescription same-store sales increased by 5.4 percent and front-of-store comparable stores increased 5.3 percent.

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Rite Aid to sponsor dirt racing events

BY Michael Johnsen

CONCORD, N.C. The World Racing Group on Monday announced that Rite Aid would sponsor in 2008 of the Rite Aid Outlaw Showdown at The Dirt Track being held at Lowe’s Motor Speedway, as well as the Rite Aid 200 at Super DIRT Week in Syracuse, N.Y.

The partnership brings a new name for the popular World of Outlaws Sprint Car Series race in Charlotte and is a renewal of Rite Aid’s participation in the premier 200-lap Advance Auto Parts Super DIRTcar Series event in Syracuse.

“We are proud to become the official sponsor of two major race events: the Rite Aid Outlaw Showdown at The Dirt Track at Lowe’s Motor Speedway and Rite Aid 200 at Super DIRT Week,” stated Jay Ross, Rite Aid vice president of marketing. “These are great, long-standing events with dedicated fans and Rite Aid is thrilled to support these exciting races in 2008.”

“This is a great partnership for our organization and our fans,” stated World Racing Group president Tom Deery. “Rite Aid’s promotional support for the World of Outlaws event in Charlotte as well as the Rite Aid 200 at Super DIRT Week is appreciated and reciprocated by fans across the entire northeast.”

Rite Aid’s promotional programs for each event will include driver appearances, show car displays and ticket giveaways at Rite Aid Pharmacies in the Carolinas and the Northeast in conjunction with each event.

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A&P to sell remaining shares of Metro to finance acquisition of Pathmark

BY Antoinette Alexander

MONTVALE, N.J. A&P has announced that it expects to close on the Pathmark acquisition in December. It also announced that it plans to sell its remaining Metro shares to finance the deal.

A&P revealed in March plans to acquire grocer Pathmark for $1.3 billion in cash, stock and debt. The move—which hardly took the industry by surprise—will create a 550-store, $11 billion supermarket chain that will likely have a greater presence in pharmacy going forward.

Assuming that the 11.7 million shares of Metro are sold prior to Nov. 30, A&P expects to use the proceeds, together with borrowings under a reduced Bridge Facility and a portion of its increased $675 million ABL Facility to finance the deal. Based on the closing price of the shares on Nov. 2, the value totals about $435 million.

“We regard the Metro divestiture as a clear near-term positive for A&P. Since the company had exited the Canadian market, the stake has little real strategic value,” stated Goldman Sachs analyst John Heinbockel in a research note. “So it is essentially being traded for the much more strategically valuable Pathmark asset.”

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