Whole Foods profit rises 33%; 69 new stores in development

Austin, Texas -- Whole Foods Market Inc. reported Wednesday that profit for the first quarter rose a better-than-expected 33% to $118.3 million amid increased customer visits and higher prices on select items. On a follow-up conference call with analysts, the chain revealed it has 69 new stores in development, or 2.4 million square feet, in development.

The natural and organic grocer generated revenue of $3.39 billion in the quarter ended Jan. 15, almost a 13% increase over the prior year and beating analysts’ expected $3.38 billion in revenue. Same-store sales rose 8.7%.

The grocer has raised its full-year outlook, now projecting a 13.5% to 15% revenue increase, up from its previously projected 13% to 15% gain.

"There are some positive things happening on the economic front which we are hopeful will continue," Whole Foods co-CEO Walter Robb said on a conference call with analysts. "We have tremendous sales momentum as well as the capital and expense disciplines in place to leverage that momentum to the bottom line."

Part of Whole Foods’ expansion strategy in 2012 will be a continuing focus on smaller footprints and building in economical neighborhoods to lower capex investments.

“Compared to last year's class of new stores, this year's class was 17% smaller in size, averaging 38,000 sq. ft. and produced average weekly sales per store of $561,000, translating to 29% higher sales per square foot of $776,” Robb said on the call.

Robb said the chain has signed 34 new leases over the last 12 months and is on track to open between 24 and 27 new stores in fiscal 2012 and 28 to 32 new stores in fiscal 2013.

“We currently have 69 stores or 2.4 million sq. ft. in development equal to 20% of our 12 million sq. ft. in operation,” he said.

Whole Foods recently signed eight new leases averaging 33,000 sq. ft. in size in Frisco, Colorado; Miami, Florida; Orland Park, Illinois; South Bend, Indiana; Minneapolis, Minnesota; Jackson, Mississippi; Port Chester, New York; and Cleveland, Ohio. Frisco, South Bend and Jackson are markets for the chain.