Whole Foods Shoppers Out Of Hibernation

So much for the predictions that the Great Recession would produce a permanent thriftiness in American consumers. As the economy slowly crawls its way towards better health, Whole Foods (Nasdaq:WFMI) is seeing a solid recovery in its sales growth and dusting off the plans to roll out still more of these higher-end grocery stores. 


The Quarter In The Bag
By any standard, Whole Foods had a strong fiscal fourth quarter. Sales jumped almost 15% from the year-ago quarter, on a better-than-6% increase in square footage. Same-store sales were up a very healthy 8.7%, as traffic rose almost 7% and "basket" (basically, how much customers spent) was up about 2%

Strong as that was, the company did just as well below the sales lines. Gross margin ticked up 40 basis points and the company trimmed about 70 basis points out of SG&A. That fueled a 100 basis point bump in operating margin, translating into 46% operating income growth.


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