Comp growth slows at Sprouts Farmers Market
Sprouts Farmers Market is generating double-digit revenue growth but its same store sales are decelerating.
The Arizona-based grocery chain reported strong third-quarter earnings and raised its guidance.
For the period ended Sept. 30, net income was $38 million and diluted earnings per share was 29 cents. Revenue was $1.33 billion, up 10.2% from nearly $1.21 billion a year earlier. Net sales growth was driven by strong performance in new stores opened, the company said.
But same-store sales rose 1.5%, less than the 2% comp growth reported for the second quarter.
“Robust new store productivity, continued product innovation and strong operations drove a double digit increase in net sales in the third quarter,” said Amin Maredia, chief executive officer of Sprouts Farmers Market. “During this time, we introduced Sprouts’ unique model of health, value and service to two new states where very strong sales demonstrated that our brand continues to resonate well in communities from coast to coast and is firmly positioned for long-term growth.”
Profit at Sprouts rose 10% to $382 million.
For the full fiscal year, Sprouts raised its EPS guidance and forecast sales to grow 11% to 11.5% for 2018, compared with its earlier forecast of 10.5% to 11.5%.
During the third quarter, Sprouts opened 12 new stores: three in California, two in Nevada and one each in Arizona, Oklahoma, Maryland, North Carolina, Texas and our first stores in the states of Pennsylvania and Washington. Two additional stores have been opened in the fourth quarter, resulting in a total of 315 stores in 19 states as of Nov. 1.