Whole Foods Market Reports Strong First-quarter Results

AUSTIN, Texas - Leading natural and organic foods retailer Whole Foods Market Inc. this week said sales for the first quarter ended Jan. 19, 2003 increased 18 percent to $924 million. The increase was driven by 11 percent weighted average year-over-year square footage growth and better than expected comparable store sales growth of 10.5 percent, the Austin, Texas-based company said. The entry of the three Harry's stores into the comparable store base negatively impacted comparable store sales by 56 basis points. Sales in identical stores (excluding two relocated stores and one major store expansion) increased 10.1 percent for the quarter.

"The economy continues to have little to no apparent impact on our sales. For the fourth consecutive quarter, we delivered comparable store sales increases of over 10 percent," said John Mackey, chairman, president and CEO of Whole Foods Market. "We leveraged our strong sales gains, producing a 37 basis point improvement in operating margin before pre-opening and interest expense."

Net income for the quarter increased 27 percent to $25.6 million from $20.1 million in the prior year, and diluted earnings per share increased 22 percent to $0.42, compared to $0.34 in the prior year. Net income and diluted earnings per share include a pre-tax impairment charge of $1.4 million, or $0.01 in diluted earnings per share, relating to the Company's investment in Gaiam Inc.

Whole Foods Market opened five new stores in the first quarter, ending the quarter with 140 stores. So far during the second quarter, the company has opened two new stores. It recently signed leases for seven new stores in Bellevue, Wash.; Louisville, Ky.; Valencia, Calif.; Long Beach, Calif.; Fort Collins, Colo.; Sarasota, Fla.; and West Vancouver, British Columbia. The company currently has 23 stores in development averaging 42,000 square feet in size.
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