Whole Foods (WFMI) announced its financial results for the quarter ended September 30 yesterday. The quarter closed about 50 days after outraged leftists called for a boycott of the grocery chain to retaliate for a Wall Street Journal op-ed written by CEO John Mackey. In that column, Mackey identified "Eight things we can do to improve health care without adding to the deficit," asserting that:
The last thing our country needs is a massive new health care entitlement that will create hundreds of billions of dollars of new unfunded deficits and move us much closer to a government takeover of our health care system. Instead, we should be trying to achieve reforms by moving in the opposite direction — toward less government control and more individual empowerment.Well, if there's so much support out there for statist health care, you would think that the Whole Foods boycott dedicated to punishing an opponent would have had a significant impact on the company's most recent quarterly results.
Whole Foods Market Inc.'s (WFMI) fiscal fourth-quarter earnings soared as revenue climbed and unusual items took less of a bite from the bottom line, leading the high-end grocer to declare that its sales have "officially turned the corner."
The company expects the sales growth to continue in its new fiscal year, with increases of 5% to 8% in overall sales and 1% to 4% in comparable-store sales. Whole Foods noted that total sales are up 5% in the first five weeks of the fiscal year, with comparable-store sales up 1.6%. Analysts were recently projecting a sales increase of 6% to $8.54 billion, according to Thomson Reuters.
.... With shoppers looking for bargains and grocers engaged in a full-scale price war, Whole Foods has been balancing its upscale image with a value message in its marketing. While it has made progress--offering meals that feed a family of four for $15--the company has still pared store openings and suspended its dividend.
For the quarter ended Sept. 27, Whole Foods reported earnings of $36.4 million, or 20 cents a share, compared with $1.5 million, or 1 cent a share, a year earlier. The latest quarter included a gain of 1 cent a share related to inventory accounting, while the year-ago included a host of charges that brought earnings down about 15 cents.
Revenue climbed 2.3% to $1.83 billion. Comparable-store sales fell 0.9%. Meanwhile, identical-store sales, which exclude eight relocations and two expansions, dropped 2.3%.
Don't be misled by the dip in same store revenues. The Consumer Price Index fell by 1.3% from September 2008 to September 2009, and any business that is managing to stay ahead of inflation/deflation, especially one that this is used to selling at the high end, is doing just fine.
WFMI is taking a hard hit today, but it has everything to do with dilution of shareholders by an investment group, and nothing to do with the company's top or bottom lines. Obviously then, it has nothing to do with the press-hyped but clearly ineffective boycott. Even with the plunge, as of 12:15 p.m. WFMI was trading above where it was when the boycott was called.
If the boycott were at all relevant, the Associated Press surely would have mentioned it in its 550-word report on the company's financial results. But it didn't, instead telling us that the results "came in just above Wall Street expectations."
The boycotters and their leftist sympathizers can point to one "accomplishment": Barack Obama's, Nancy Pelosi's, and Harry Reid's "uncertain economy made some investors nervous about its (the company's) outlook for the year." One element of that uncertainty is whether, despite CEO Mackey's warning, the President and Congress ends up dragging the nation kicking and screaming down the road towards statist health care.
The start of the Whole Foods boycott, which apparently peaked at 23,000 supporters, was covered by the New York Times, the Washington Post, ABC News, and even the BBC. Does anyone think any one of them will do a follow-up on the non-results?
By contrast, the press almost completely ignored the American Family Association's ultimately successful 2-year boycott of Ford Motor Company that ended in March 2008. That boycott had over 780,000 petition signers and dozens of high-membership supporting organizations, and is the main reason why Ford's sales results consistently trailed rivals General Motors, Toyota, and the overall auto market during that time.
It's impossible not to conclude that the establishment media chooses to cover or not cover boycotts based on their degree of political correctness, and not on their level of participation or demonstrated effectiveness.
Cross-posted at BizzyBlog.com.