drugstore.com inc. Achieves GAAP Profitability in the Fourth Quart...(18650 Mail-order pharmacy ...),Health

Mail-order pharmacy 931 1,055 3,967 5,501

Local pick-up pharmacy 1,110 1,064 4,383 4,128

Vision 673 561 2,708 2,478

9,193 8,136 33,317 30,757

Contribution margin:

Over-the-Counter (OTC) $14,013 $10,113 $47,554 $39,640

Mail-order pharmacy 1,061 1,058 4,241 3,852

Local pick-up pharmacy 2,461 1,955 8,398 6,872

Vision 2,386 2,146 10,294 8,620

$19,921 $15,272 $70,487 $58,984

SUPPLEMENTAL INFORMATION: Reconciliation of Net Income (Loss) to Adjusted EBITDA (See Note 4 below):
Three Months Ended Twelve Months Ended

December 30, December 31, December 30, December 31,

2007 2006 2007 2006

(In thousands, unless

otherwise indicated)

Net income (loss) $156 $(2,947) $(9,011) $(13,026)

Amortization of intangible

assets 244 468 1,234 2,060

Amortization of non-cash

marketing 573 573 2,290 2,290

Stock-based compensation 1,687 1,705 8,801 6,721

Depreciation 1,761 1,540 7,504 6,040

Interest income, net (410) (438) (1,675) (1,730)

Adjusted EBITDA $4,011 $901 $9,143 $2,355

NOTE 4: Supplemental information related to the company's adjusted EBITDA

for the three and twelve months ended December 30, 2007 and

December 31, 2006 is presented for inform
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