Whole Foods Market Reports First Quarter Results
For stores in the identical store base, gross profit improved 46 basis points to 34.8% of sales, direct store expenses improved 54 basis points to 26.1% of sales, and store contribution improved 100 basis points to 8.7% of sales .
G&A expenses increased seven basis points to 2.9% of sales due primarily to higher wages as a percentage of sales.
Pre-opening expenses were $8.6 million versus $12.8 million in the prior year, including pre-opening rent of $4.9 million versus $7.6 million in the prior year. Relocation, store closure and lease termination costs were $3.1 million versus $12.4 million in the prior year. This included store closure reserve adjustments of $1.0 million versus $10.1 million in the prior year.
Net interest income was $0.3 million versus net interest expense of $8.8 million in the prior year driven by a $326 million decrease in total debt and a $186 million increase in cash and investments year over year.During the quarter, the Company produced $253.0 million in cash flow from operations and invested $91.0 million in capital expenditures, of which $45.6 million related to new stores. This resulted in free cash flow of $162.0 million. In addition, the Company repaid $100 million of its term loan maturing in August 2012. At the end of the quarter, total cash and cash equivalents, restricted cash, and investments were $762.0 million, and total debt was $408.3 million. Subsequent to the close of the first quarter, the Company repaid another $200 million of its term loan, leaving $190 million currently outstanding. The Company also reinstated its quarterly cash dividend at $0.10 per share, paying $17.3 million to shareholders on January 20, 2011. Additional information on the quarter for comparable stores and all stores is provided in the following table.
|Comparable Stores||Comps||NOPAT ROIC 1||# of Stores||Average Size||Total Square Feet|
|Over 14 years old (18.9 years old, s.f. weighted)||3.3%||92%||56||26,200||1,467,000|
|Between 11 and 14 years old||8.9%||74%||62||30,500||1,891,000|
|Between eight and 11 years old||7.8%||59%||49||33,200||1,625,700|
|Between five and eight years old||8.3%||46%||50||42,100||2,106,700|
|Between two and five years old||14.9%||10%||54||53,900||2,908,400|
|Between one and two years old (no relocations)||14.6%||8%||14||47,000||657,600|
|All comparable stores (8.6 years old, s.f. weighted)||9.1%||36%||285||37,400||10,656,400|
|All stores (8.1 years old, s.f. weighted)||31%||302||37,700||11,391,600|
|Comparable store sales growth||-3.1%||11.0%||5.4%||9.1%|
|Identical store sales growth||-4.3%||10.3%||4.4%||9.1%|
|Ending square footage growth||6%||46%||15.0%||6.0%|
|Percent of sales from new & relocated stores||7%||9%||7%||4%|
|Direct store expenses||25.4%||26.7%||26.3%||26.3%|
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