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VOL. 127 | NO. 150 | Thursday, August 02, 2012

Fred's July Revenue Figure Rises

AP

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MEMPHIS (AP) – Discount-store operator Fred's Inc. said Wednesday that a key revenue figure edged up in July, boosted by markdowns aimed at increasing customer traffic. The company also raised its earnings guidance for the second quarter, citing a tax settlement with the state of Tennessee.

Its shares rose almost 2 percent in late afternoon trading.

Fred's said revenue in stores open at least one year rose 1.2 percent during the four weeks ended July 28. Total sales for the month rose 5 percent to $136.7 million.

Fred's, based on Memphis, Tenn., said pet, household supplies and pharmacy categories were big sellers during the month, and the company marked down goods to drive traffic into stores.

For the second-quarter, total revenue rose 4 percent to $470.7 million from $452.7 million, while revenue in stores open at least a year slipped 1.0 percent.

Analysts expected $468.9 million, according to FactSet.

Fred's also said that it completed negotiations with the state of Tennessee to settle a tax matter, which will help offset costs related to store closings and July sales markdowns, in the second quarter.

Because of that, the company now expects earnings per share for the second quarter to be 17 cents to 19 cents, up from prior guidance of 15 cents to 17 cents per share. Analysts expect 15 cents per share.

Fred's Inc. operates 698 discount general merchandise stores, including 21 franchised Fred's stores, in the southeastern United States.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 106 418 11,538
MORTGAGES 135 521 14,424
FORECLOSURE NOTICES 0 0 2,278
BUILDING PERMITS 220 913 24,947
BANKRUPTCIES 53 297 8,729
BUSINESS LICENSES 26 119 3,890
UTILITY CONNECTIONS 71 524 13,980
MARRIAGE LICENSES 13 83 3,114

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