Fred's Reports January Sales

Fred's Reports January Sales

MEMPHIS, Tenn.--(BUSINESS WIRE)-- Fred's Inc. (NAS: FRED) today reported sales for the five-week month of January and 53-week fiscal year 2012, which ended February 2, 2013, versus four-week month and 52-week year-earlier periods.

On an unadjusted basis, Fred's total sales for January 2013 rose 31% to $173.6 million compared with $132.4 million for the four-week year-earlier period, and comparable store sales for January increased 28.6%. On an unadjusted basis, fourth quarter total sales increased 7% to $533.5 million compared with $497.7 million for the year-earlier quarter, and comparable store sales increased 4.8%. Total sales for fiscal 2012 increased 4% to a record $1.956 billion for the 53-week year versus $1.879 billion for the 52-week fiscal 2011. Comparable store sales increased 1.1% for the year on an unadjusted basis.

To make sales results for January and fiscal 2012 comparable with those of the prior year, the Company eliminated the week ended February 2, 2013, to make similar four-, 13-, and 52-week periods. On this adjusted basis, total sales increased 2% for January, were flat for the fourth quarter, and increased 2% for fiscal 2012. On the adjusted basis, comparable store sales were flat in January versus a decrease of 0.8% in the year-earlier period. The fourth quarter comparable store sales, on an adjusted basis, decreased 2.8% compared with an increase of 0.1% in the prior-year period. On an adjusted basis, comparable store sales for fiscal 2012 decreased 1.4% versus an increase of 0.5% for fiscal 2011.

Commenting on the announcement, Bruce A. Efird, Chief Executive Officer, said, "We were pleased by strengthening sales momentum in January. This improvement reflected the initiatives we have put in place in tobacco, programs to drive higher ticket amounts, and continued increases in pharmacy script growth. Discretionary sales at the end of the month were pressured to some extent by delays in finalizing tax forms for 2012 that prevented our customers from receiving early tax refunds. Overall, we were pleased with the direction of our business in January and the many exciting new programs we have in store for 2013."

Efird continued, "We look forward to the new year and our expansion in specialty pharmacy and clinical services, an acceleration of pharmacy acquisitions, our expansion of new auto and hardware product initiatives, and a roll out of new concepts, such as the smaller drug and dollar store. Considering Fred's growth prospects in the rapidly changing pharmacy industry, along with our new general merchandise initiatives, we believe there are significant opportunities to drive higher sales and profits in 2013."

During January, Fred's opened two new stores, closed one store and closed one Xpress pharmacy. For the year, Fred's added a net total of 12 new locations, consisting of 20 new stores and 6 new Xpress pharmacies, which was offset by the closing of 14 company-owned stores. The Company also opened 24 new pharmacies in 2012 and closed 3, for a net addition of 21 pharmacies during the year.

Fred's, Inc. operates 712 discount general merchandise stores, including 21 franchised Fred's stores, in the southeastern United States. For more information about the Company, visit Fred's website at www.fredsinc.com.

Comments in this news release that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements.These risks and uncertainties include, but are not limited to, general economic trends, changes in consumer demand or purchase patterns, delays or interruptions in the flow of merchandise between the Company's distribution centers and its stores or between the Company's suppliers and same, a disruption in the Company's data processing services, costs and delays in acquiring or developing new store sites, and other contingencies discussed in the Company's Securities and Exchange Commission filings.Fred's undertakes no obligation to release revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unforeseen events, except as required to be reported under the rules and regulations of the Securities and Exchange Commission.

Fred's Inc.
Jerry A. Shore, 901-362-3733, Ext. 2217
Executive Vice President and Chief Financial Officer

KEYWORDS: United States North America Tennessee

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