Whole Foods Market has said that it aims to eventually have around 1,000 stores in the US after telling analysts that it has the cash to expand.
Speaking at the Jefferies 2011 Global Consumer Conference yesterday (21 June), Whole Foods’ co-CEO Walter Robb told attendees that the upmarket grocer hopes to increase its store numbers in the US from the firm’s current 300.
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Robb said that the centrepiece of its success over the last three years has been the “clean-up” of the company’s balance sheet. The co-CEO told analysts that in the last four quarter, Whole Foods has generated US$645m in free cash flow and $166m from stock option exercises. The company has also paid off $700m in debt and invested $275 in stores.
“I feel like we’re in a very strong position to execute against the opportunities that we see right now,” Robb said, adding that the company will use the cash to re-accelerate growth.
“The next big opportunity is to build more stores,” he added. “We were lined up to do 30 stores in 2007 but we scaled that back by half to 15. Next year we’re going to build somewhere around 20 [stores], might be more. We’re going to give you more detail on our growth plans in the third quarter call.”
He added: “How many stores can we do? The answer is 1,000 in the US and that’s not just talk. We have set down an idea on where we think potential for the company is. We feel pretty good about that number.”
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By GlobalDataThe natural and organic retailer also remained bullish on Canada.
“We have six stores there and are on our way to 35,” Robb told analysts. “In the UK we’re going a little bit slower. We’re doing another round of stores in the UK in the next two years. That will tell us a lot about how we’re going to compete with other stores of that size.”
As part of its health and wellness initiatives, Whole Foods said it also plans to open five wellness clubs in different cities around the US for a monthly membership fee of around $50.
Shares in the retailer jumped on the back of the comments, up 6.2% at the market’s close yesterday to $60.41 a share.
