Fred's says key April figure rose, beating Street

Fred's Inc. discount chain said Wednesday that its revenue at stores open at least a year rose 0.6 percent in April, better than the loss analysts predicted.

Analysts surveyed by Thomson Reuters on average expected the figure to drop 1 percent for the four-week period that ended May 1.

Revenue in stores open at least a year is a key measure of retailer performance because it isn't skewed by results from stores that opened or closed during the year.

The figure rose 5 percent for Fred's during the same period last year, compared with April 2008.

The chain's total sales for the month grew 1 percent to $137.6 million.

For the full first quarter, Fred's revenue at stores open at least a year rose 2.2 percent and total revenue climbed 3 percent to $471.7 million. Analysts expected total first-quarter revenue of $466.4 million.

CEO Bruce Efird said higher consumer spending produced the April increase in Fred's revenue at stores open at least a year. And he said the company is positioned well to meet the upper end of its first-quarter earnings forecast.

The company has said it expects to earn between 15 cents per share and 20 cents per share for the quarter. Analysts expect earnings per share of 17 cents, according to Thomson.

Fred's opened one store and five pharmacies in the first quarter. Based in Memphis, it operates 670 stores in the southeast.

Shares fell 61 cents, or 4.4 percent, to close at $13.31 on Wednesday.

The company is due to announce first-quarter results May 26.