AUSTIN, Texas -- Whole Foods Market here said last week its natural foods format will not be affected by a slowing economy, citing strong fourth-quarter, comp-store sales growth to support its confidence.
John Mackey, Whole Foods chairman, chief executive officer and president, said in a conference call with investment analysts following the release of fourth-quarter results, "We believe that because of our strong and differentiated brand, we are proving to be somewhat insulated from an economic slowdown.
"Our core customers are motivated by quality, health, social and environmental concerns and our customer demographic is less economically sensitive."
The company reported comp-store sales growth of 10.2% for the fourth quarter ended Sept. 30 as evidence of Whole Foods' ability to weather uncertain economic times. Comp-store gains for the year were 9.2%.
"The fourth quarter marked our second consecutive quarter of double-digit comps and our fourth consecutive quarter of accelerating comps, despite the soft economy. New stores between one and two years old produced 25% comps and stores over five years old produced comps above 6%," Mackey said.
Whole Foods also noted that the company would be closing three underperforming stores. The stores, totaling 68,000 square feet, were acquired as part of previous multi-store transactions. The company reported sales of $576.5 million for the quarter, an increase of 21%. The company said the increase was primarily driven by a year-over-year, square-footage growth of 13%.
Net income for the quarter was $11 million. The company posted a net loss in the previous fourth quarter of $42 million.
The company also announced its guidance for 2002, which included top-line sales growth of 15% to 20%, and earnings per share of $1.30 to $1.36, with capital expenditures expected to be in the range of $180 million to $200 million.
Mackey said, "We are living in discontinuous times, unlike anything we have experienced before. While our sales have held up well, future performance is uncertain.
"The economy appears to be in recession and the potential for further terrorist acts exists; therefore, we plan to continue to be cautious and conservative in our guidance for the foreseeable future."