Revenue during the quarter dropped 3.13 percent to $532.32 million from $549.55 million in the previous year period. Gross margin for the quarter contracted 75 basis points over the previous year period to 24.97 percent. Operating margin for the quarter stood at negative 6.42 percent as compared to a positive 0.44 percent for the previous year period.

Operating loss for the quarter was $34.17 million, compared with an operating income of $2.43 million in the previous year period.

Commenting on today results, Michael K. Bloom, chief executive officer, said, “In the first quarter of fiscal year 2017, we continued executing the Fred’s Pharmacy healthcare transformation, a clear point of differentiation in our markets, which resulted in positive script comps in Retail Pharmacy and record sales and year-over-year growth in Specialty Pharmacy. Our strong performance in Total Pharmacy was the primary driver for sequential improvement in our operating performance excluding non-operating items. With the right leadership team in place, we continue to enhance our talent, invest in technology, expand the Specialty salesforce and diversify the Specialty portfolio. We also continue to improve the pharmacist-patient relationship, which is reflected in our positive script comps in the Retail Pharmacy. Both our Retail and Specialty Pharmacy businesses are rapidly improving and driving momentum. In the Front Store, our remodel program, which will be accelerated in the back half of 2017, is already improving the customer experience and driving sales. Notably, the comp sales of our remodeled stores with our new prototype are performing approximately 4.0% better than the chain average through April."