Pharmhouse progresses despite first-quarter loss

Drug Store News, July 14, 1997

NEW YORK -- Pharmhouse, a chain of 35 discount drug stores headquartered here, reported a loss for its 1998 first quarter ended May 3, 1997, but the loss was a dramatic improvement over last year's first-quarter performance.

In first quarter 1998, Pharmhouse lost $186,000, compared to a $992,000 loss in first quarter 1997.

Income from operations also increased dramatically to $628,000 vs. $48,000 for the same period in fiscal 1997.

Pharmhouse president and chief executive officer Ken Davis attributed the substantial improvements to the company's new cost reduction program, which went into effect last year; the favorable effects of Pharmhouse's legal settlement with Woolworth, which was consummated on Jan. 31, 1997; and the closing of three under-performing stores, two of which were Rx Place stores that Pharmhouse returned to Woolworth as part of their settlement.

Fiscal 1998 revenues for the first quarter were $51.4 million vs. $57.1 million for the same period a year ago. But a year ago, Pharmhouse had 38 stores in operation, and for this quarter it had 35. Same-store sales decreased 3.3 percent, excluding the stores subject to the Woolworth settlement.