12.11.2004: Meldung: Whole Foods Market: Fourth Quarter Results

AUSTIN, Texas, Nov. 10 / Whole Foods Market today reported sales and earnings for the 12-week quarter and 52-week fiscal year ended September 26, 2004. For the fourth quarter, sales increased 24% to $927.3 million, net income increased 27% to $30.2 million, diluted earnings per share increased 21% to $0.46, and Economic Value Added (EVA) improved $2.0 million to $1.0 million. For the fiscal year, sales increased 23% to $3.9 billion, net income increased 32% to $137.1 million, diluted earnings per share increased 26% to $2.09, and EVA improved $12.6 million to $15.2 million. The Company also announced that its Board of Directors approved a 27% increase in the quarterly dividend to $0.19 per share from $0.15 per share.

Operating Highlights 4Q04 FY04 Sales increase 24% 23% Comparable store sales growth 14.0% 14.9% Identical store sales growth 13.3% 14.5% Weighted average square footage growth 13% 9% Number of stores opened / acquired 3 19 Net income increase 27% 32% Diluted earnings per share (EPS) increase 21% 26% EVA increase $2.0 mil $12.6 mil Cash dividend payments to shareholders $9.4 mil $27.7 mil

"Our fourth quarter results cap off an outstanding year," said John Mackey, Chairman, Chief Executive Officer, and Co-Founder of Whole Foods Market. "In a year that has proven to be very challenging for most food retailers, we grew sales 23% to just under $4 billion, and our 14.9% comparable store sales increase set a new company record. Our net profit margin improved 25 basis points to 3.5% of sales, and we produced a 26% increase in diluted earnings per share to $2.09, which was well ahead of our initial guidance of $1.87 to $1.95. We reported our fourth consecutive quarter of positive EVA resulting in record incremental EVA improvement of $12.6 million. In addition, we are very pleased, after initiating a dividend payment to shareholders just one year ago, to be announcing a 27% increase in that dividend today."

In the fourth quarter, gross profit increased 35 basis points to 34.7% of sales, and direct store expenses increased 44 basis points to 25.9% of sales, resulting in a 10 basis point decrease in store contribution to 8.7% of sales. For the 145 stores in the comparable store base, gross profit improved 66 basis points to 35.1% of sales, and direct store expenses increased 16 basis points to 25.6% of sales, resulting in a 49 basis point increase in store contribution to 9.4% of sales. General and administrative (G&A) expenses were flat at 3.0% of sales.

Capital expenditures in the quarter were $64 million of which $37 million was for new store development. The Company produced cash flow from operations of $75 million during the quarter and paid approximately $9 million to shareholders in its third quarterly dividend of $0.15 per share. Cash and cash equivalents, including restricted cash, were approximately $222 million at the end of the quarter, and total long-term debt, which includes $159 million in Zero Coupon Convertible Debentures, was approximately $171 million.

In the fourth quarter, the Company opened three new stores in Princeton, NJ; Valencia, CA; and West Vancouver, British Columbia, ending the quarter with 163 stores totaling approximately 5.1 million square feet. The Company has opened one store in Hingham, MA and expects to open two additional stores in Redwood City, CA and Sarasota, FL in the first quarter of fiscal year 2005.

The Company is pleased to announce the recent signing of eight new store leases in Seattle, WA; Denver, CO; Greenville, SC; Santa Barbara, CA; Long Island, NY; Manhattan, NY; Sacramento, CA; and Tustin, CA (a relocation). The following table provides additional information about the Company"s store development pipeline.

Stores in Development 11/10/04 11/12/03 % Change Number of stores in development 53 35 51% Average size (gross square feet) 49,000 45,000 9% As a percentage of existing store average size 155% 143% - Total square footage under development 2,600,000 1,600,000 61% As a percentage of existing square footage 50% 35% -

The Company today announced that its Board of Directors approved a 27% increase in the Company"s quarterly dividend to $0.19 per share from $0.15 per share. The first $0.19 per share quarterly dividend will be payable January 17, 2005 to shareholders of record as of January 7, 2005 and is expected to pay out approximately $48 million in calendar 2005.

The Company has a stated long-term growth goal of $10 billion in sales by the year 2010. As shown in the table above, the Company produced above- average sales and comparable store sales increases in fiscal year 2004 and will, therefore, face difficult comparisons in 2005, particularly in the second quarter when it will be comparing against a 17.1% comparable store sales increase. For fiscal year 2005, however, the Company still expects sales growth of 15% to 20% and comparable store sales growth of 8% to 10%. The Company expects weighted average square footage growth of approximately 15% based on the opening of 15 to 18 new stores, including three relocations. Diluted earnings per share growth is expected to be lower than sales growth primarily due to the anticipated acceleration in square footage growth, which is expected to result in pre-opening expenses in the range of $18 million to $20 million versus $10 million in the prior year. In addition, new stores could have some negative impact on store contribution, as new stores generally have lower gross margins and higher direct store expenses than more mature stores. Capital expenditures are expected to be in the range of $300 million to $320 million.

The Company"s guidance does not include any impact from the Financial Accounting Standards Board"s (FASB) proposed Statement 123R, Share-based Payment, which would require all companies to expense share-based payments, including stock options, at fair value. The current proposed guidelines would be applied to companies for interim or annual periods beginning after June 15, 2005; therefore, the Company would expect to begin expensing stock options in the fourth quarter of fiscal year 2005. The Company"s guidance excludes any impact from expensing stock options as FASB has not issued a final statement.

About Whole Foods Market: Founded in 1980 in Austin, Texas, Whole Foods Market(R) is the largest natural and organic foods retailer. The Company had sales of $3.9 billion in fiscal year 2004 and currently has 164 stores in the United States, Canada and the United Kingdom.

CONTACT: Cindy McCann, VP of Investor Relations of Whole Foods Market, Inc., +1-512-477-4455

Whole Foods Market, Inc.
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