Drug retailer Rite Aid (NYSE: RAD) reported a fiscal-first-quarter loss that was less than expected, and confirmed that it is on track to achieve its full-year guidance.

After 10 straight quarters of declining sales, Rite Aid saw sales hold basically flat for a second consecutive quarter on the back of its customer rewards program. However, Fools should note that sales for the Pennsylvania-based retailer haven't grown at the same rate as at larger industry peers Walgreen (NYSE: WAG) and CVS Caremark (NYSE: CVS).

Let's delve a little deeper into the numbers to see how Rite Aid performed this quarter.

A look at the numbers
Revenues for the quarter remained more or less stagnant at $6.39 billion, compared to the year-ago period. Positive same-stores sales of 0.8% helped push up revenues in spite of overall store closures, which pulled that revenue figure down. Losses narrowed to $65.5 million, from $76 million a year ago. The company reported a loss per share of $0.07.

What worked well for Rite Aid this quarter was its Wellness Plus customer rewards program. It now has nearly 40 million members. Wellness Plus members accounted for more than 67% of sales of cosmetics and food and around 62% of prescription sales.

To boost sales, Rite Aid plans to remodel some 500 of its 4,600 stores this fiscal year. The company is also planning to expand its Save-A-Lot Rite Aid stores, which it runs in conjunction with SUPERVALU (NYSE: SVU). These stores have shown solid sales growth.

The company produced free cash flow of $336.5 million, down from $484.4 million in the year-ago period. The company has tended to burn cash in the other three quarters.

The Foolish bottom line
Rite Aid is in the midst of reinvigorating itself, and it forecasts losses during this transformative period. It sees full-year losses of between $0.42 and $0.64 a share, compared with a loss per share of $0.64 a year ago. For now, I think it is best to view this stock with caution. Until it fully turns around, I'm a bit nervous to stick my toes into this stock.  

Shubh Datta doesn't own any shares in the companies mentioned above. The Motley Fool owns shares of SUPERVALU. Motley Fool newsletter services have recommended buying calls in SUPERVALU. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.