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Whole Foods Market realigns leadership; Mackey becomes co-CEO
May 13th, 2010
AUSTIN, Texas – Under an executive realignment, Whole Foods Market Inc. co-founder John Mackey will share the chief executive officer post, and the company will now have a single president and chief operating officer.
The natural and organic supermarket chain said late Wednesday that Walter Robb, co-president and COO along with A.C. Gallo, has been promoted to co-CEO. Gallo has been named as the sole president and COO.
Whole Foods said the moves are effective immediately. Robb and Gallo also will join the company's board of directors.
With the changes, Mackey becomes co-CEO, serving with Robb. The company said its executive team — Mackey, Robb and Gallo plus Glenda Chamberlain, executive vice president and chief financial officer, and Jim Sud, executive vice president of growth and business development — have worked closely together since 2001 and will continue their collaborative style of leadership and decision-making.
In addition, Robb and Gallo will continue to share oversight of Whole Foods' 12 operating regions as well as purchasing, distribution, marketing and quality standards.
"Walter and A.C. are brilliant retailers, and their contributions to Whole Foods Market's success have been immeasurable. Due in large part to their operational leadership, we successfully managed through 2009, the most difficult year in our company's 30-year history," Mackey said in a statement.
"In proposing these changes to our board of directors, my goal was to establish the structure necessary to solidify our executive leadership team for what is hopefully many years to come," Mackey added. "While our company has achieved much over our 30-year history, we believe the best is yet to come for Whole Foods Market and want to work together to see our collective vision realized."
Also on Wednesday, Whole Foods reported strong results for its fiscal 2010 second quarter.
For the 12-week quarter ended April 11, revenue increased 13% to $2.1 billion. Comparable-store sales increased 8.7%, and identical-store sales (excluding four relocations) rose 7.7%.
Income available to common shareholders in the 2010 second quarter more than doubled to $67.45 million, or 39 cents per diluted share, from $27.32 million, or 19 cents per diluted share, a year earlier. Earnings before interest, taxes, depreciation and amortization (EBITDA) increased 40% to $182.3 million.
Analysts surveyed by Thomson Financial had forecast Whole Foods' 2010 second quarter earnings at 33 cents per share, on average.
Earnings results reflect a $3.2 million, or 1 cent per diluted share, gain on the sale of a nonoperating property in the current year and asset impairment charges of $13.1 million, or 5 cents per diluted share, in the prior year, Whole Foods reported.
"Our second-quarter results are the best we have reported in several years, with extremely strong growth in comparable-store sales, earnings and cash flow," Mackey said in a statement. "We have successfully emerged from this recession with a healthier balance sheet and better capital disciplines. Our new stores are performing very well, and we look forward to rebuilding our store development pipeline and re-accelerating our square footage growth in the future.”
Whole Foods said it opened three stores in the second quarter and has opened three stores so far in the third quarter. The chain currently has 295 stores.