Whole Foods Profit Tops Estimate; Sales Fall Shy

(RTTNews) - Organic grocer Whole Foods Market, Inc. (WFM) said Wednesday after the markets closed that its third quarter profit rose 6.3% from last year, as same-store sales increased 3.9%.

The company's quarterly earnings per share also came in above analysts' expectations, but its quarterly sales fell shy of analyst' forecast. At the same time, the company forecast fourth quarter results below analysts' current consensus estimates. The company also lowered the top end of its fiscal 2014 earnings forecast range and once again cut its sales outlook for the fiscal year.

"Our business model is producing industry-leading sales per gross square foot, healthy returns on invested capital and strong operating cash flow," said Walter Robb, co-CEO of Whole Foods Market. "We are seeing signs of stability in our sales trends and believe our strategic initiatives will help generate further momentum and produce increasing returns on invested capital over the long term."

The company also announced a new share repurchase program with $1 billion in authority through August 1, 2016, and canceled the $322 million in remaining authority under its existing share repurchase program.

Whole Foods shares are currently losing 2.84% in after hours trading after closing the day's regular trading session at $39.11, up $1.43 or 3.80%. The shares trade in a 52-week range of $36.08 to $65.59.

For the third quarter ended July 6, 2014, the company reported net income of $151 million or $0.41 per share, compared to $142 million or $0.38 per share for the year-ago quarter.

On average, 31 analysts polled by Thomson Reuters expected the company to earn $0.39 per share for the third quarter.

Sales for the third quarter rose 10% to $3.38 billion from $3.06 billion in the same quarter last year. Twenty-seven analysts had a consensus revenue estimate of $3.39 billion for the third quarter.

Looking forward to the fourth quarter, the company forecasts sales growth of 8.5% to 9.5% and earnings of $0.31 to $0.33 per share. Analysts currently expect the company to earn $0.34 per share on revenue growth of 11.80% for the fourth quarter.

For the fiscal year 2014, the company now expects sales growth of 9.6% to 9.9% and earnings of $1.52 to $1.554 per share. Previously, the company expected sales growth of 10.5% to 11.0% and earnings of $1.52 to to $1.56 per share. Analysts currently expect the company to earn $1.53 per share on revenue growth of 10.50% for the fiscal year 2014.