More Rite Aid pharmacies are closing in the Philadelphia region before the end of the year
The pharmacy chain announced that it would close stores as it looks to reduce rent expenses and strengthen its financial position.
Rite Aid will close three more stores in the Philadelphia region later this month, amid the company’s bankruptcy.
The Philadelphia-based pharmacy chain filed for Chapter 11 bankruptcy protection in October and has been shuttering locations nationwide. As of October, Rite Aid had closed about 18 stores in Philadelphia in the past year, and during its last fiscal year, which ended in March, the company closed 190 stores nationwide.
Rite Aid initially announced that it was looking to sell nearly 100 store leases and properties across the country in October, according to the Philadelphia Business Journal.
The company says it is closing underperforming stores to “reduce rent expense and strengthen overall financial performance,” according to a statement Rite Aid shared with The Inquirer.
Around 75% of employees affected by store closures have accepted opportunities to transfer to new positions within the company, a spokesperson said. Rite Aid is also working to transfer customers’ prescriptions to other pharmacies.
Forthcoming store closures in the Philadelphia region:
2545 Aramingo Ave., Philadelphia — will close Dec. 14
121 W. Main St., Moorestown — will close Dec. 14
927 Paoli Pike, West Chester — will close Dec. 27
Debt, lawsuits, and underperforming stores
Rite Aid’s bankruptcy comes as the company is facing $4 billion in debt and over 1,600 lawsuits related to opioid prescriptions. Rite Aid also had long-term leases for stores that are no longer profitable, according to company filings.
Rite Aid was granted the approval to secure up to $3.45 billion in financing in October in bankruptcy court proceedings, which allows the company to continue operations during the bankruptcy process. The court allowed the company to continue to pay wages, salaries, and benefits to employees, as well as pay vendors and suppliers without interruption.
The company reported a net loss of $306.7 million in its first quarter this fiscal year that ended in June, according to company earnings. That compares to a $110.2 million loss in the first quarter of the prior fiscal year.
Rite Aid moved its headquarters from Camp Hill, near Harrisburg, to the Navy Yard last year and has deep roots in Pennsylvania. The company was founded in Scranton in 1962 as “Thrift D Discount Center,” and as of October operated over 2,100 retail pharmacy stores in 17 states.