AUSTIN, Texas -- Whole Foods Market here said the strike-lockout in Southern California has had a positive impact of approximately 2.5% on comparable-store sales during the first few weeks of the first quarter.
John Mackey, chairman, president and chief executive officer, said the labor dispute has impacted 19 Whole Foods stores in Southern California, including 17 in the comp-store base, with comparable-store growth for the company averaging 13.7% during the first six weeks of the quarter including those stores, and "just over" 11% excluding them.
"We have already seen the positive sales benefit lessen in degree after the union stopped picketing at Ralphs two weeks ago," Mackey said. "As a strike goes on, it's natural to see some erosion, but our comps are still very strong in the Southern California region."
Although the company has no historical data on which to rely and no idea how long the strike will last, Mackey said Whole Foods anticipates first-quarter comps of 9.5% to 12.5%, including the positive impact from the strike.
In response to a question, Walter Robb, executive vice president of operations, said the company believes it will retain some of the additional business it has picked up during the labor dispute. However, "it's way too early to quantify it," Glenda Flanagan, executive vice president and chief financial officer, added.
Mackey, Robb and Flanagan made their remarks during a conference call with securities analysts last week to discuss financial results for the year and fourth quarter ended Sept. 28. For the year, sales rose 17% to $3.1 billion, with comparable-store sales climbing 8.6%, and net income rising 22.7% to $103.7 million. For the 12-week quarter, sales rose 17.6% to $750.7 million, with comps up 8.8%, and net income up 8% to $23.8 million.
