HARRISBURG, Pa. — Rite Aid Corp., the nation's third-biggest drugstore chain, reported Thursday that it lost $960.4 million in its fourth quarter, mostly the result of a non-cash income tax charge, as it worked to absorb more than 1,800 stores acquired last year.

The company said it expects to lose money in fiscal 2009 for a third straight year and that sales would be below what analysts are predicting.

Rite Aid blamed a tough economy and spending to integrate the 1,850 Brooks and Eckerd stores it acquired last June in an effort to keep pace with its larger rivals, Walgreen Co. and CVS Caremark Corp.

Rite Aid's chairman and chief executive, Mary Sammons, acknowledged that the company's performance in fiscal 2008 did not measure up as she had hoped. She also said Rite Aid will need more time than anticipated to raise the performance of the acquired stores, which analysts say lag well behind the competition.

But Sammons sought to play up the company's resilience, such as filling more prescriptions and achieving better gross margin rates, amid a turbulent economy and fears of recession.

"It was a challenging quarter for retail," Sammons told analysts on a conference call. "While Rite Aid's sales were softer than expected in December, they improved in the last two months of the quarter."

Rite Aid's results suggest that expansion-related expense pressures are eroding cash flows, Goldman Sachs said in an analyst note, adding that the company's sales outlook for fiscal 2009 seems optimistic.

The loss for the Camp Hill, Pa.-based company amounts to $1.20 per share for the three months ending March 1. It earned $7.1 million, or a penny a share, in last year's fourth quarter.

Not counting the $894.9 million non-cash income tax charge, Rite Aid said it would have lost $65.5 million, or 8 cents a share in the latest period. Analysts surveyed by Thomson Financial had expected a loss of 7 cents a share and typically exclude one-time charges from their estimates.

Revenues rose 50 percent to $6.82 billion from $4.53 billion a year earlier, primarily due to last year's acquisition. Analysts expected slightly higher revenue of $6.87 billion.

Same-store sales, or sales in stores open at least one year, rose 1.3 percent. Rite Aid operates more than 5,000 stores in 31 states and Washington, D.C.

For the year, Rite Aid lost $1.1 billion, or $1.54 per share, compared to last year's loss of $4.7 million, or a penny per share, much of it due to the non-cash income tax charge. The company also said it spent $154.2 million to integrate the Brooks and Eckerd stores.

Revenues rose to $24.3 billion, a little below analyst expectations, up from last year's $17.4 billion.

Rite Aid said it anticipates a 2009 loss between $260 million and $375 million, or 34 cents to 48 cents per share, with revenue in a range of $26.7 billion to $27.2 billion. Analysts had forecast a smaller loss of 18 cents per share on higher revenue of $27.6 billion.