Earnings: Drugstore.com turns first profit
Increase in orders, strong sales put e-tailer over top
P-I STAFF
Bellevue-based Drugstore.com Inc. reported a quarterly profit for the first time Wednesday, partly thanks to an 8 percent increase in orders and strong sales of over-the-counter products.
"While holiday sales were clearly impacted by the economy, we saw strong sales of our everyday OTC basics, reinforcing our belief that a large portion of our products are not considered discretionary by our customers," said Dawn Lepore, chief executive and chairwoman of Drugstore.com.
The company expects that it will grow ahead of e-commerce trends, she said. Drugstore.com attracted 406,000 new customers in the fourth quarter, an 8 percent jump over last year. It has 2.6 million active customers.
Drugstore.com had originally thought that the fourth quarter of 2007 was profitable, but after the corporate earnings call last year, the state of New Jersey settled against the company in a sales tax case, costing the company $2.5 million and resulting in a quarterly loss.
Net income for the quarter that ended in December was $289,000, or break-even per share, compared with a $2.3 million loss, or 2 cents per share, in the fourth quarter of 2007.
Wall Street analysts had expected a penny per share in earnings, so Drugstore.com missed expectations by 1 cent.
Quarterly revenue was $93.9 million.
The company's annual net loss was $8.3 million, or 9 cents per share, compared with an $11.5 million net loss, or 12 cents, the previous year.
Revenue for the year came to $366.6 million.
For the first quarter of 2009, Drugstore.com expects net sales between $93 million and $97 million and net income between zero dollars and a $2 million net loss.
