Longs CEO Resigns; Retailer Expects Drop in Quarter Profit

Longs Drug Stores Corp., which operates a chain of drugstores in the western U.S., said President and Chief Executive Steve Roath resigned and that first-quarter profit will unexpectedly decline.

Roath said in a statement that he is leaving to let his successor carry out the retailer’s long-term plans from start to finish as Roath had planned to retire. Board member Harold Somerset was named president and chief executive while Longs looks for a replacement.

Fiscal first-quarter per-share profit will fall to 26 cents to 30 cents from 31 cents a year earlier, Longs said in a separate statement. Sales at stores open at least a year, a key retail measure, will rise as much as 2%, the company said.

Longs was forecast to earn 33 cents a share, the average estimate of three analysts polled by Thomson Financial/First Call.

In the fourth quarter, net income almost tripled to $21.8 million, or 58 cents a share, from $8 million, or 22 cents, a year earlier. Sales in the quarter ended Jan. 31 climbed 9.7% to $1.21 billion.

Excluding costs for closing stores, year-ago profit would have been $23.4 million, or 63 cents a share.

Longs also said it will realign its board so that it will be mostly made up of outside directors.

Shares of Longs, based in Walnut Creek, Calif., fell 28 cents to $24.93 on the New York Stock Exchange. The news was released after the close of regular trading.

Spokeswoman Nancy Cockerham didn’t immediately return a phone call for further comment.