Longs Drug Stores Corporation Reports Second Quart...(/p Retail drug store operating income ...),Health

Retail drug store operating income was $31.6 million, or 2.6 percent of retail drug store sales, compared with $33.4 million, or 2.8 percent of sales last year. Pharmacy benefit services operating income was $14.9 million, or 11.4 percent of pharmacy benefit services revenues, compared with $10.9 million, or 13.8 percent of pharmacy benefit services revenues last year.

First Six Months

Income

Income from continuing operations for the 26 weeks ended July 31, 2008 was $50.6 million, or $1.40 per diluted share, compared with income from continuing operations for the 26 weeks ended July 26, 2007 of $41.8 million, or $1.09 per diluted share, including $5.8 million of after-tax charges related to the disposition of stores.

Revenues

Total revenues of $2.74 billion for the 26 weeks ended July 31, 2008 were 6.5 percent higher than the $2.57 billion reported for the 26 weeks ended July 26, 2007.

Retail drug store sales increased 1.7 percent to $2.42 billion from $2.38 billion in the comparable period last year. Same-store sales decreased 0.1 percent with pharmacy same-store sales flat with last year and front-end same- store sales decreasing 0.1 percent. Pharmacy sales were 52.0 percent of retail drug store sales during the period, compared with 51.8 percent a year ago.

Pharmacy benefit services revenues increased 66.8 percent to $318.6 million from $191.0 million in the comparable period last year. Prescription drug plan revenues were $278.0 million compared with $162.2 million last year and pharmacy benefit management revenues were $40.6 million compared with $28.7 million a year ago.

Retail Drug Store Gross Profit

Retail drug store gross profit for the 26 weeks ended July 31, 2008 was $645.4 million, or 26.7 percent of retail drug store sales, compared with $618.4 million, or 26.0 percent of retail drug store sales, last year. The increase in gross profit as a percent of sales was primarily due to higher
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