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ARBOR DRUGS, INC. REPORTS RECORD THIRD-QUARTER RESULTS; NET INCOME UP 16.4 PERCENT ON SALES INCREASE OF 10.5 PERCENT

 TROY, Mich., May 27 /PRNewswire/ -- Arbor Drugs, Inc. (NASDAQ-NMS: ARBR), which currently operates 135 drugstores in Michigan, today announced a 16.4-percent increase in net income and 10.5-percent increase in net sales for its third quarter ended April 30, 1993.
 Eugene Applebaum, chairman, president and chief executive officer, attributed the record third-quarter performance to disciplined expense control and strong pharmaceutical unit sales growth.
 Arbor's fiscal 1993 third-quarter net income was $3,878,000, or $0.24 per share, up from $3,333,000, or $0.21 per share, in fiscal 1992.
 Net sales were $133,572,000 this quarter versus $120,928,000 for the quarter ended April 30, 1992. Comparable store sales increased by 5.2 percent for the three-month period. Excluding the loss of one day in February 1993 versus February 1992, comparable store sales would have increased by approximately 6.6 percent.
 Net income for the first nine months of the year was $12,921,000, up 10.0 percent over last year's $11,743,000. Earnings per share advanced to $0.80 from $0.73. Excluding a one-time second-quarter charge to earnings of $0.04 per share, earnings per share for the period would have been $0.84, up 15.1 percent over last year's comparable period.
 Sales for the first nine months of the year were $398,233,000, up 12.8 percent from $353,166,000 in the same period for last year. Comparable store sales for the period increased by 7.7 percent over last year's comparable period.
 The board of directors of the Troy-based retailer also declared a regular quarterly cash dividend of $0.05 per share, payable July 1, 1993, to holders of record as of June 17, 1993.
 Commenting on the company's financial performance, Mr. Applebaum said, "We are very pleased with our record results for the third quarter of fiscal 1993, particularly in view of the inclement weather during much of February and March. Our strategic focus on health care and everyday convenience, combined with the operational excellence of our organization, continues to generate record sales and profits.
 "Arbor's growing sales base reflects the fundamental strength of our traditional drugstore format with its core pharmacy operation," Applebaum continued. "It is especially gratifying to note that Arbor can achieve strong net income increases, in spite of the lower sales increases which have resulted from a declining rate of pharmaceutical inflation. Looking ahead, we remain confident that fiscal 1993 will be another outstanding year for the company.
 "We also are very pleased to announce that Arbor's excellent sales momentum has enabled our company to become the market share leader in southeastern Michigan and advance to the nation's 20th-largest drugstore chain," Applebaum concluded.
 Arbor Drugs ranks among the top performers nationally in the chain drugstore industry in several key categories, including: sales per store, sales per square foot, and net profit percentage.
 ARBOR DRUGS, INC.
 FINANCIAL HIGHLIGHTS
 (Dollars and number of shares in 000s)
 Three Months Ended April 30,
 1993 1992 Percent Change
 Net sales $133,572 $120,928 10.5
 Cost of sales 97,625 87,808 11.2
 Selling, general and
 administrative expense 29,982 27,710 8.2
 Income from operations 6,055 5,410 11.9
 Income before income tax 5,858 5,004 17.1
 Income tax provision 1,980 1,671 18.5
 Net income 3,878 3,333 16.4
 Earnings per common share $.24 $.21 14.3
 Weighted average No.
 common shares 16,227 16,166 0.4
 Number of stores (end
 of period) 134 122 9.8
 Nine Months Ended April 30,
 1993(a) 1992 Percent Change
 Net sales $398,233 $353,166 12.8
 Cost of sales 291,108 256,110 13.7
 Selling, general and
 administrative expense 87,476 78,508 11.4
 Income from operations 19,649 18,548 5.9
 Income before income tax 19,001 17,485 8.7
 Income tax provision 6,080 5,742 5.9
 Net income 12,921 11,743 10.0
 Earnings per common share $.80 $.73 9.6
 Weighted average No.
 common shares 16,210 16,125 0.5
 (a) 1993 results include a $1.025 million pre-tax charge to earnings (after tax $677,000, or $.04 per share), resulting from the disposition of a lease dispute.
 -0- 5/27/93
 /CONTACT: Gilbert C. Gerhard, chief financial officer of Arbor Drugs, Inc., 313-643-9420/
 (ARBR)


CO: Arbor Drug Stores, Inc. ST: Michigan IN: REA SU: ERN

DH-ML -- DE006 -- 2800 05/27/93 09:09 EDT
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Date:May 27, 1993
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