WHOLE FOODS SALES HIT $1 BILLION MARK IN 2Q

AUSTIN, Texas -- Whole Foods Market here raced through its first $1 billion quarter on the strength of a 20% sales growth and comparable-store gain of 11.6%, the company said last week.For the 12-week fiscal second quarter ended April 10, the natural foods retailer earned $42 million on sales of $1.1 billion. The robust sales results prompted the company to raise its expectations of yearly comparable-store

AUSTIN, Texas -- Whole Foods Market here raced through its first $1 billion quarter on the strength of a 20% sales growth and comparable-store gain of 11.6%, the company said last week.

For the 12-week fiscal second quarter ended April 10, the natural foods retailer earned $42 million on sales of $1.1 billion. The robust sales results prompted the company to raise its expectations of yearly comparable-store growth to 9% to 11% from previous estimates of 8% to 10%.

In a conference call discussing quarterly results, John Mackey, Whole Foods' chief executive officer, said the company would relocate all of its stores smaller than 30,000 square feet; and, encouraged by the recent opening of its 80,000-square-foot flagship in Austin, has plans to open 20 stores that exceed 60,000 feet.

Mackey said the Austin store "is not only the largest, but best store we've ever opened," ranking among the top five in weekly sales. "The success of this store at 80,000 square feet certainly made us think we're open to the idea of doing other 80,000-square-foot stores."

The company said it was supporting its growth through product development and staffing, noting it's attracting talent from conventional stores and supply partners as a result of its growth.

Gross margins increased 29 basis points to 35.7% during the quarter as a result of strong sales, but according to Glenda Flanagan, chief financial officer, the company expects margins over the course of the year would be more in line with annual rates of 34.5% to 35%.

2ND-QUARTER RESULTS

Qtr Ended: 4/10/05; 4/11/04

Sales: $1.01 billion; $902.1 million

Change: +20%

Comp-store: +11.6%

Net Income: $42 million; $34 million

Change: +22%

Inc/Share: 61 cents; 53 cents

28 Weeks: 2005; 2004

Sales: $2.5 billion; $2.0 billion

Change: +21.4%

Net Income: $89.9 million; $71.9 million

Change: +25%

Inc/Share: $1.33; $1.11