Whole Foods Market
( WFMI) posted 26% first-quarter profit growth as its continued expansion helped boost sales, though earnings per share were a penny shy of estimates.
The Austin, Texas-based company reported earnings of $58.3 million, or 40 cents a share, up from $46.2 million, or 37 cents a share, a year earlier. Sales for the quarter ended Jan. 15 grew to $1.67 billion from $1.39 billion.
Analysts expected earnings of 41 cents a share and sales of $1.66 billion, according to Thomson First Call.
Same-store sales rose 13%, aided by a 7% increase in the average number of customer transactions and a 6% rise in the average value per transaction. Overall results were also boosted by a "significant" increase in investment income due to a large cash balance, but the company noted that isn't expected to continue since it paid out $299 million in dividends after the close of the quarter.
Looking ahead, Whole Foods continues to expect sales growth of 18% to 21% in 2006, with same-store sales growth of 8% to 11%. The company also reiterated that it expects earnings per share to grow at a lower rate, amid higher pre-opening and relocation costs and an increase in outstanding shares. Whole Foods' plan has long been to expand through sales growth rather than through margin leverage.
The company, which currently has 181 stores, expects $340 million to $360 million in capital spending in fiscal 2006, with 60% of that related to new stores. The company, which is seeking to reach $12 billion in sales by 2010, said it has 72 stores currently in development.
Whole Foods shares recently fell $2.17, or 3%, to $69.88 in after-hours trading.