Whole Foods Market Inc (NASDAQ:WFM) on Wednesday said same-store sales have accelerated, helped by stronger consumer confidence and shoppers' positive response to the upscale grocer's price cutting and its first national advertising campaign.
Shares in the largest U.S. organic and natural food supermarket were up 2.1 percent in extended trading after the news helped ease fears that Whole Foods was losing market share amid increased competition from specialty retailers Sprouts Farmers Market Inc and Fresh Market Inc, as well as mainstream retailers such as Kroger Co and Wal-Mart Stores Inc.
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Same-store sales, a closely watched performance gauge for retailers, rose 4.5 percent for the first quarter that ended Jan. 18. That matched the analyst estimate compiled by Consensus Metrix.
Those sales were up 4.9 percent for the current quarter through Feb. 8.
Same-store sales increased 3.1 percent during the quarter ended Sept. 28.
Among other things, Whole Foods has been cutting prices on fresh produce and other perishable goods as it works to shed its "Whole Paycheck" nickname and its reputation for high prices. It recently ran its first national advertising campaign and is testing a shopper loyalty program.
"We attribute our broad-based sales momentum to our customers' positive response to our many strategic initiatives, along with improving consumer confidence," Walter Robb, Whole Foods' co-chief executive officer, said in a statement.
Quarterly net income grew almost 6 percent to $167 million, or 46 cents per share, in the latest quarter. Analysts, on average, had expected a profit of 45 cents per share, according to Thomson Reuters I/B/E/S.
Total sales were up more than 10 percent to $4.67 billion.
The company also reiterated its forecast for 2015 sales growth over 9 percent and same-store sales growth in the low to mid-single digit percentages.
Shares in Whole Foods were up $1.14 to $54.65 in extended trading.
(Reporting by Lisa Baertlein in Los Angeles; Editing by Andrew Hay and Lisa Shumaker)