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Whole Foods Profit Falls on Wild Oats Acquisition Costs

BY CSA STAFF

Austin, Texas, Whole Foods Market Inc. said Tuesday that its fiscal fourth-quarter profit fell 15% from a year ago, as it spent more on opening new stores and ran up legal fees in its fight to acquire rival Wild Oats Markets Inc. Same-store sales rose 8.2% in the quarter ended Sept. 30.

Whole Foods earned $33.9 million in its fourth quarter, down from $39.8 million a year earlier. Legal bills and the costs of integrating Wild Oats increased costs by $13 million.

Revenue rose 35% to $1.74 billion. Excluding the Wild Oats stores, sales rose 16% to about $1.6 billion.

Analysts forecast $1.62 billion in sales. Same-store sales rose 8.2% in the quarter ended Sept. 30.

The September quarter was the last in Whole Foods’ fiscal year, which was less profitable than the previous year.

For the year, the retailer earned $182.7 million on sales of $6.59 billion, compared with $203.8 million profit on lower revenue, $5.61 billion, in the previous 12 months.

Chairman and chief Executive John Mackey said his company had succeeded in boosting sales at the Wild Oats stores. He said they would approach Whole Foods locations in sales per square foot after the company finishes spending $40 million to $50 million renovating the Oats locations in about a year.

Whole Foods has closed nine Wild Oats stores and plans to shutter eight of the remaining 63 that are near new Whole Foods locations, Mackey said. Whole Foods sold 35 Henry’s and Sun Harvest stores that came with Wild Oats for $166 million.

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GameStop reports strong 3Q earnings

BY CSA STAFF

GRAPEVINE, Texas GameStop today reported that earnings for the third quarter ended Nov. 3 were $52 million. Diluted earnings per share were 31 cents for the third quarter of 2007.

The company reported that total sales increased 59.3% to $1.6 billion in comparison to $1 billion in the prior year quarter. Comparable-store sales increased 46.3% during the third quarter, also beating previously released guidance of 30% to 32%.

Richard Fontaine, GameStops chairman and ceo, stated, Our third quarter sales and earnings are a reflection of not only the real momentum in the video game business as a whole, but a particularly strong statement that GameStops model continues to run ahead of the growth curve. We had an outstanding quarter both domestically and internationally, while our e-commerce division, GameStop.com, and video game publication, Game Informer, had record quarters.”

For the fourth quarter of fiscal 2007, GameStop is forecasting comparable-store sales to range from up 7% to up 9%, on top of comparable-store sales of 26.5% in the fourth quarter of fiscal 2006 when the Nintendo Wii and Sonys Playstation 3 were launched. Diluted earnings per share are expected to range from 95 cents to 97 cents compared to earnings per share of 81 cents in the fourth quarter of 2006.

The company has also raised its fourth quarter guidance. The company now expects full year 2007 diluted earnings per share guidance to range from $1.61 to $1.63. Total revenues are now projected to grow between 28% and 29%, with expected comparable-store sales ranging from up 20% to up 21%.

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Bausch & Lomb names general counsel

BY CSA STAFF

ROCHESTER, N.Y. Bausch & Lomb has named Robert Bailey corporate vp and general counsel. Bailey was most recently vp, assistant general counsel and assistant secretary for the company.

Bailey re-joined Bausch & Lomb in 1997 after serving as associate general counsel and assistant secretary at Goulds Pumps from 1995-1997. He first joined at Bausch & Lomb as counsel from 1994 to 1995. He began his legal career as an associate with what is now the Nixon Peabody law firm in Rochester, N.Y.

Bailey replaces Robert Stiles who has announced his intention to retire from Bausch & Lomb in 2008, after a career spanning more than 25 years with Bausch & Lomb, most recently as senior vp and general counsel.

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