Fred's announces a 25 percent stock dividend

Fred's, Inc (Nasdaq: FRED) announced earlier today that it will be splitting its stock in a 5-for-4 stock dividend; the new shares will be distributed on June 18, 2001 to all shareholders on record as of June 4, 2001. FRED also declared that it would distribute its regular quarterly dividend of $0.04 per share, which is the post split figure, on or about the same date.

Fred's, Inc. came to the table on the 22nd of May with an edict of record earnings for the company's first quarter. The press release stated that FRED's net income for the first quarter increased 24% to $4,159,000 or $0.34 per diluted share compared with $3,345,000 or $0.28 per diluted share in the year-earlier quarter. Retail sales by Company stores for the first quarter increased 19% and total sales rose 18% to $207,359,000 compared with $176,132,000 in the same period last year. On a comparable store basis, sales increased 10.0% for the quarter.

Fred's, Inc. currently does not have enough authorized shares to accommodate this split. It is assumed that the shareholders will be voting on this issue in the near future. As it stands currently, FRED has approximately 12.1 million shares outstanding, 3.30 million shares in the float, and roughly 12.5 million shares authorized for issuance to the public.

Shares of FRED are unchanged at $26 in recent mid-day trading. Volume is heavy at 100,500; the three-month average is 52,100. The 52-week trading range is $15.88 to $27.85. This is the company's second stock split since it was founded in 1947.

About the Company:

The first Fred's store opened in 1947 in Coldwater, MS. Fred's operates 337 stores and 200 pharmacies in 11 states throughout the Southeast; Fred's is a retail center that distributes, name brand, discount brands, and Fred's own unique label of goods. The company's distribution center is located in Memphis, TN.

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