The company is moving forward swiftly to assimilate the Brooksand Eckerd stores, Sammons said in the call. "We were ready to hitthe ground running," she said. "The integration of the distributioncenters is almost complete. We've started work on the pilot stores,and hope to have the systems conversions complete by the end offiscal 2008 for all stores. We've now converted all 44,000 of thenew employees to the new payroll. We feel good about ourintegration plans."

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She says the firm is on track to open 125 new and relocatedstores this year. In the first quarter, the company opened sixstores, relocated seven stores, acquired seven stores and closed orsold 14 stores. This does not include the 26 stores sold off aspart of the sale agreement, or another 150 Rite Aid/Brooks andEckard pairs of stores being examined for being too close totogether, say company officials.

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The company projects a net loss of between $47 million and $129million for the fiscal year, including the estimated expense ofintegrating the acquired stores of $145 million. The company hasmore than 5,100 stores, including the new acquisition units, in 31states and Washington, DC.

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