Whole Foods appointed five new independent directors and named a new chair and chief financial officer on Wednesday as it said a key sales metric declined for the seventh consecutive quarter.
Shares in the company rose 2.5 per cent in extended trade after the company said comparable store sales declined for the seventh consecutive quarter, falling 2.8 per cent in its fiscal second quarter. However, that was narrower than the 3.1 per cent drop that analysts’ had forecast. Whole Foods said it expects to return to positive same-store sales growth by the end of its next fiscal year.
Sales rose 1.1 per cent to $3.7bn, in line with analysts’ forecasts. The timing of the Easter holiday, which fell in its fiscal third quarter this year compared with the second quarter in 2016, weighed on its results.
Meanwhile, profits slid to $99m or 31 cents a share, compared with $142m or 44 cents a share in the year-ago period. That compared with analysts’ estimates for earnings of 37 cents.
Rising competition from the likes of Sprouts Farmers Market and Trader Joe’s along with organic offerings from larger stores like Walmart and Costco, alongside a deflationary food price environment has weighed on Whole Foods results in recent years.
Looking ahead, Whole Foods reiterated expectations for full-year comparable sales to fall by 2.5 per cent or less.
The news of the shake up was first reported by Dow Jones earlier on Wednesday and comes as activist investor Jana Partners has been pressuring Whole Foods to roll out sweeping changes, including a possible sale.