Grocery delivery lifts Sprouts Farmers Market
Sprouts Farmers Market is accelerating growth with grocery delivery and a private label assortment that is driving sales.
The Phoenix-based retailer revised its earnings-per-share guidance for 2019 (from 16 cents to 18 cents) after the company reported net sales of $1.4 billion, a 10% increase compared to the same period in 2018. The growth was driven by a 1.4% increase in same-store sales and strong performance in new stores opened, among other factors cited by the company.
“Sprouts’ efficient model continues to produce strong returns on invested capital resulting in healthy cash generation,” said Brad Lukow, interim co-CEO and chief financial officer of Sprouts Farmers Market, in a statement. “This sound financial footing, coupled with strong new store productivity, supports continued expansion of our trusted brand across existing markets and three additional states this year.”
During a call with analysts, Lukow said grocery delivery sales at Sprouts were up more than 60% year-over-year for the quarter ending March 31.
“Our focus on fresh and healthy products at great prices has positioned us well to meet the needs of today’s customers, and our ongoing investments in technology for efficiency, digital channels for brand and product awareness, and innovation for differentiation are paving the way to success for years to come,” said Jim Nielsen, interim co-CEO, president and chief operating officer of Sprouts Farmers Marketin a statement.
In February, Sprouts reported that its private label sales continue to grow at 25%, almost doubling since 2013, with more than 2,400 SKUs.
In the first quarter, Sprouts reported net income of $56 million, compared to $67 million from the same period in 2018. Diluted earnings per share were 46 cents compared to 50 cents from the same period in 2018. Gross profit for the quarter increased 9% to $484 million.
During the first quarter of 2019, Sprouts opened eight new stores. The company now operates 321 stores in 19 states.