Whole Foods Market, Inc. (NASDAQ:WFM) Posts Record Sales Of $3.3 Billion In Q2

Posted by Lynn Eisler May 9, 2014 0 Comment 1375 views

Whole Foods Market, Inc. (NASDAQ:WFM) has reported its second quarter results for the year 2014. The company posted record sales of $3.3 billion, which increased 20 percent year over year. Comparable store sales rose 4.5 percent on top of a 6.9 percent increase in the prior year.

The company’s operating income was $231 million, or 7 percent of sales, and EBITDA were $318 million, or 9.6 percent of sales. Whole Foods Market’s net income for the quarter was $142 million, or 4.3 percent of sales, diluted earnings per share were $0.38, and return on invested capital was 15.6 percent.

During the quarter, the company produced $282 million in cash flow from operations and invested $143 million in capital expenditures, of which $85 million related to new stores. This resulted in free cash flow of $139 million.

In addition, Whole Foods Market paid $45 million in quarterly dividends to shareholders and repurchased $55 million of common stock. Subsequent to the close of the quarter, the company repurchased another $15 million of common stock, leaving $668 million in remaining share repurchase authority.

At the end of the quarter, Whole Foods had about $1.5 billion in form of cash and equivalents.

John Mackey, co-founder and co-chief executive officer of Whole Foods Market, commented, “Whole Foods Market is the premier brand in natural and organic foods, with unparalleled quality standards and the broadest selection. As we continue to innovate and evolve at a fast pace, we are confident in our ability to gain market share and expect our sales to approach $25 billion over the next five years.”

28-week period ended earnings

For the 28-week period ended April 13, 2014, the company total sales rose 10 percent to $7.6 billion. Operating income was6.4 percent of sales at $486 million, EBITDA was $684 million. Net income for the period was $300 million, or diluted earnings per share were $0.80.

The company, which has currently has 379 stores, has added eight new stores in six new markets, and expects to open 7 more stores during the Q3, 2014, and additional 11-14 stores in the Q4. The company said it expects to see demand for 1,200 company’s stores in the US.

Outlook for FY14

The company expects sales growth of approximately 11 percent, comparable store sales growth of 5- 5.5 percent, and diluted earnings per share of $1.52-1.56. Before pre-opening, operating income is expected to increase 6-12 percent, as well as the company expects a second-half tax rate of 39 percent compared to 38.2 percent last year. Capital expenditures of $675-725 million is also estimated.

“We are excited to share our longer-term strategic vision with our stakeholders.  This is not guidance but rather a reasonable roadmap of how we are thinking about evolving our business model,” said Walter Robb, co-chief executive officer of Whole Foods Market.

About Lynn Eisler

Lynn Eisler is a national news reporter focusing on economic issues, data analysis and the financial health of state and local governments. Lynn has been honored with the H.L. Mencken Award for Investigative Reporting, the Champion of Justice Award for reporting on the drug war, and the John Hancock Award for business reporting. Lynn was also a Knight Medical School Fellow at the University of Michigan.

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