Fred

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The Memphis-based discount retailer reportefd net incomeof $8.6 million, or 21 cents per dilutesd share, for first quarter up 17.8 percent compared to net income of $7.3 million, or 18 centa per diluted share in first quarter 2008. The companyt had total first quarter salesof $458.4 down 1.3 percent compareds to $464.3 million for first quarter 2008. In 2008, Fred’sx (NASDAQ: FRED) closed 74 underperforming stores and 23 underperforming pharmacies. Excluding stores closed last year, the company increased totakl sales 5 percent in the first quarter comparec to thesame year-ago period. On a comparable store basis, year-to-date sales increased 2.8% comparec with 2.
1% in the same perior last year. Fred’s CEO Bruce A. Efird said he expectedx to see more improvementg in thesecond quarter. “This will be a formidable task as we will be contendinb with the economic stimulus checks consumers received last year and recorunemployment rates," he said in a statement. "Ws also plan to launch our enhance d store prototype in approximately 16 new and remodeled stores durinyg thesecond quarter." During the first Fred's opened three new stores and three new pharmacies, whiler closing three pharmacies.
Fred’s board of directors also increaserthe company’s quarter cash dividend to 3 centsz per share from the prior rate of 2 centw per share. The dividend is payable on June 15 to shareholderss of record as ofJune 1. Fred'sa operates 666 discount generalmerchandise stores, including 24 franchised Shares of Fred’s were trading lower in late Thursdayy trading, down about 5 percent to $13.1r per share.