Whole Foods profit tumbles, sales fall short of forecasts
Michael Leone, right, shops with his daughters, Simone, 4, left, and Lucia, 6, at a new Whole Foods Market that opened Wednesday in downtown Los Angeles.(Mel Melcon / Los Angeles Times)
Whole Foods employee Gilbert Ayard fillets an ahi tuna during the grand opening Wednesday of the Whole Foods in downtown L.A.(Mel Melcon / Los Angeles Times)
Park Hwa Ja checks out the produce while shopping with Penten Jong, 1, at Whole Foods.(Mel Melcon / Los Angeles Times)
Cake decorators Tanya Hilaire, left, and Morena Lazo deliver finished cakes to the display counter.(Mel Melcon / Los Angeles Times)
Customer Amy Zaporetsky, who rode her bicycle to the store, shops inside the new Whole Foods Market.(Mel Melcon / Los Angeles Times)
Shopper Abigail Schilling, left, samples a glass of red wine from Hearst Winery during the grand opening at Whole Foods.(Mel Melcon / Los Angeles Times)
From left, Manuel Gonzalez, Maycol Thomas and Ricardo Gomez take a break while working at the store.(Mel Melcon / Los Angeles Times)
Tony Rozelle, 41, left, of Hollywood samples a green veggie roll from Jason Tan inside the new Whole Foods Market on Grand Avenue.(Mel Melcon / Los Angeles Times)
Puddles Pity Party performs inside the Eight Bar at Whole Foods.(Mel Melcon / Los Angeles Times)
Pedestrians make their way past downtown L.A.'s new Whole Foods Market.(Mel Melcon / Los Angeles Times)
Whole Foods Market Inc. said its latest quarterly profit fell by more than half as it faces intense competition, with organic foods becoming more widely available.
The Austin, Texas company said Wednesday that it earned $56 million, or 16 cents per share, in its fiscal fourth quarter, compared with $128 million, or 35 cents per share, a year earlier.
The earnings included $80 million in charges for restructuring and asset impairment costs, which analysts sometimes exclude in their predictions. Excluding those items, profit came to 30 cents per share.
The average estimate of analysts surveyed by Zacks Investment Research was for earnings of 35 cents per share.
The grocery chain’s revenue rose 6% to $3.44 billion, which fell short of analyst forecasts of $3.48 billion.
Sales in locations open at least a year — a key metric of a retailer’s health — were virtually flat, dropping 0.2%.
Whole Foods also announced plans to return more money to shareholders. Its board authorized a buyback plan of up to $1 billion, bringing the total amount available for repurchases to $1.3 billion. And it raised its quarterly dividend by 4%, to 13.5 cents.
For the fiscal year ended Sept. 27, the company earned $536 million, or $1.48 per share, on revenue of $15.39 billion. Revenue at established stores rose 2.5%.
Whole Foods forecast sales growth of 3% to 5% this fiscal year, down from 8% last year. It expects to open about 30 new stores, including three 365 stores — its lower-price division with smaller stores.
Shares slid more than 7% in after-hours trading to $28.47. Whole Foods shares have declined 39% since the beginning of the year, while the Standard & Poor’s 500 index has risen 2%.
Your guide to our new economic reality.
Get our free business newsletter for insights and tips for getting by.
You may occasionally receive promotional content from the Los Angeles Times.