Natural Grocers Eyeing $1 Billion Mark
Natural Grocers is poised to become a member of the $1 billion club after posting encouraging first quarter results in contrast to the difficulties of others in the natural and organic space.
The planned opening of up to six new stores and expectations for same store sales growth of as much as 2.5% have Natural Grocers on a trajectory to achieve annual sales of $1 billion.
For the first quarter ended Dec. 31, Natural Grocers said net sales increased 3.8% to $230 million. Same store sales increased 1.9%. Operating income was $2.8 million and net income was $1.9 million with diluted earnings per share of 8 cents.
"We are encouraged by our solid start to fiscal 2020, delivering continued positive daily average comparable stores sales growth of 1.9%," said Kemper Isely, co-president. "We continue to see positive results from our marketing initiatives and sustained growth in our successful Npower loyalty program. We are particularly pleased with our strong supplement sales in the quarter, which reflected our traffic-driving initiatives, new product introductions and strong consumer demand. We remain confident with our fiscal 2020 outlook and continue to focus on driving profitable growth and enhancing shareholder value."
Natural Grocers appears to be bucking the trend of others in the space such as Earth Fare and Lucky's Market that are going bankrupt or closing stores. Natural Grocers' annual sales last year were $903.6 million, so same store sales growth of 2.5% and new selling space might get them close to $1 billion in sales in 2020.
During the first quarter of fiscal 2020, the company opened two new stores, including its first store in Louisiana, ending the quarter with a total store count of 155 stores in 20 states. The company's two new store openings during the first quarter of fiscal 2020 compared to opening four new stores, relocating one store and closing one store in the first quarter of fiscal 2019, resulted in 2.6% and 6.3% unit growth rates for the 12-month periods ended Dec. 31, 2019, and Dec. 31, 2018, respectively.
Since Dec. 31, 2019, the company has opened one new store.
The company has signed leases for four new stores and acquired the property for one additional new store each to be located in Colorado, New Mexico, Oregon, Utah and Washington. These new stores are planned to open during fiscal 2020 and beyond.
Natural Grocers by Vitamin Cottage Inc., founded in 1955, sells products that do not contain artificial colors, flavors, preservatives or sweeteners, or partially hydrogenated or hydrogenated oils. The company sells only USDA certified organic produce and exclusively pasture-raised, non-confinement dairy products, and free-range eggs.
The company also provides free science-based nutrition education programs to help customers make informed health and nutrition choices.