- Fred's (NASDAQ:FRED) drops sharply in early trading after Q3 results disappoint and the company cancels its dividend payout to focus on debt repayment and share buybacks.
- Comparable sales fell 0.8% in Q3. Management says "aggressive" inventory reduction and the timing of high-margin seasonal merchandise shipments during the quarter put pressure on EPS and EBITA.
- CEO Michael Bllom on some of the Fred's Q3 high points: "We have witnessed a complete turnaround in our tobacco business, significantly enhanced cosmetics and successfully rolled out beer to approximately 150 stores and wine to approximately 50 stores. We have also kicked off a reduced price endcap test, which is showing promising results, and we intend to roll it out to all stores."
- The retailer says it will consider strategic options for its non-core assets going forward.
- Shares of Fred's are down 11.59% premarket to $4.50.
- Previously: Fred's EPS of -$1.38 (Dec. 6)