Fred's reports 3 percent sales increase for February

MEMPHIS, Tenn. Fred’s on Friday reported a 3 percent increase in sales, to $148.5 million, for the four-week fiscal month of February, the first month of fiscal 2008, which ended March 1.

Comparable store sales for the month rose 1.1 percent versus an increase of 3.9 percent in the same period last year.

“In February we enjoyed the positive effects of our recently announced short-term initiatives to improve in-stock positions on most popular items and enhance operational execution at our best performing stores and pharmacies,” stated Fred’s chief executive officer Michael Hayes. “Largely as a result of these efforts, traffic increased 1 percent for the month despite the fact that sales slowed significantly in the last week of February. This slowdown demonstrated the economic challenges our customers are facing as well as the leap year effect, which moved two ad days into March. We expect the traffic momentum from our programs to extend through March as we continue the implementation of our strategic plan.”

During February, Fred’s opened five new stores and closed two stores. Pursuant to its recently announced strategic plan aimed at improving company performance, Fred’s expects to open 18 stores and 15 pharmacies in 2008 and close 75 underperforming stores during the year.