MEMPHIS, Tenn. Fred’s Inc. last week reported second-quarter sales of $424.6 million for the period ending Aug. 3, representing an increase of 4 percent. Comparable store sales for the quarter increased 0.8 percent versus the same period last year.
"Sales in July were below our expectations. Softlines, pharmacy and stationery were not as strong as we had planned, while pets and domestics were ahead of plan for the month," commented Fred’s chief executive officer Michael Hayes on the results.
"Helping to offset slower sales, we had lower-than-planned markdowns on back-to-school supplies," Hayes added, "and the shift to generic drugs, as we have said before, should have a largely neutral-to-positive effect on our bottom line because of the increased margin on generics."
In July, Fred’s opened three new stores and one pharmacy. Through the first half of fiscal 2007, Fred’s has opened 16 new stores and nine pharmacies and has closed 16 stores and four pharmacies. For the full fiscal year 2007, the Company plans to open a total of 30 to 35 new stores, 15 to 25 new pharmacies, and expects to close 20 to 25 stores.