Whole Foods Market has reported that first quarter (Q1) profit fell 29 per cent for the beginning of 2009, down to US$27.8m from US$39.1m in 2008, mainly as a result of US$11m in legal costs related to the acquisition of Wild Oats.
Net sales for the period climbed slightly to US$2.47bn from US$2.46bn in 2008, although sales at stores open for at least one year dropped 4 per cent.
"The difficult strategic decisions we made last August to contain costs and cut capital spending are helping us successfully manage through this challenging economic environment." said chairman and CEO John Mackey. "Despite flat sales in the first quarter, our EDITDA was approximately equal to last year, we produced strong cash flow from operations, and we generated US$31.8m of positive free cash flow.
We are demonstrating we can operationally adjust to lower sales volumes, and believe that this flexibility, combined with our improved balance sheet, will enable us to emerge stronger and better positioned over the long term," he added.
Meanwhile, Mr Mackey confirmed that the group remained committed to its UK operations, which includes four Fresh & Wild stores and a Kensington store in London.
"We believe there is great growth potential in the UK, and we are taking proactive steps to improve our operations there," he said. "Our overall operating cash flow in the UK on a currency-adjusted basis improved to negative US$1,7m in the first quarter from negative US$3.3m last year, and we believe that dedicated and focused executive leadership will drive further improvements in our financial performance, resulting in strong returns over the longer term."
Overall group sales for the year are expected to hit US$8.5bn, the group said, driven by the launch of 15 new outlets.