News Details

Sprouts Farmers Market, Inc. Reports Third Quarter 2022 Results

November 8, 2022

PHOENIX, Ariz., Nov. 08, 2022 (GLOBE NEWSWIRE) -- Sprouts Farmers Market, Inc. (Nasdaq: SFM) today reported results for the 13-week third quarter ended October 2, 2022.

"We are encouraged by our performance in the third quarter, including total sales growth of 5%, comparable store sales growth of 2.4% and earnings per share growth of 9%," said Jack Sinclair, chief executive officer of Sprouts Farmers Market. "I thank the team for their collaboration and commitment in delivering these results and most importantly, their dedication to helping our customers discover better, healthier eating. We are excited about bringing the holiday season to life in our stores and are well-positioned to benefit from the ongoing health and wellness trends."

Third Quarter Highlights:

  • Net sales totaled $1.6 billion; a 5% increase from the same period in 2021
  • Comparable store sales growth of 2.4%
  • Diluted earnings per share of $0.61; compared to diluted earnings per share of $0.56 in the same period in 2021
  • Opened 1 new store, resulting in 379 stores in 23 states as of October 2, 2022

Leverage and Liquidity in Third Quarter 2022

  • Ended the quarter with $316 million in cash and cash equivalents and a $250 million balance on its $700 million revolving credit facility
  • Repurchased 1.6 million shares of common stock for a total investment of $44 million
  • Generated cash from operations of $307 million and invested $71 million in capital expenditures, net of landlord reimbursement, year-to-date thru October 2, 2022

Fourth Quarter and Full-Year 2022 Outlook

"Due to our strong performance to date, we are raising our full-year outlook," said Chip Molloy, chief financial officer of Sprouts Farmers Market. "We remain focused on controlling the controllable to deliver strong results and create sustainable shareholder value for the long-term.”

The following provides information on our full-year 2022 outlook:

  • Net sales growth: 4.5% - 5.0%
  • Comparable store sales growth: approximately 2%
  • Adjusted diluted earnings per share: $2.32 to $2.36
  • Unit growth: 16 new stores
  • Capital expenditures (net of landlord reimbursements): $120M to $135M

The following provides information on our fourth quarter 2022 outlook:

  • Comparable store sales growth: approximately 2.0%
  • Adjusted diluted earnings per share: $0.35 to $0.39

Third Quarter 2022 Conference Call

Sprouts will hold a conference call at 5 p.m. Eastern Standard Time on Tuesday, November 8, 2022, during which Sprouts executives will further discuss third quarter 2022 financial results.

A webcast of the conference call will be available through Sprouts’ investor relations webpage located at Participants should register on the website approximately ten minutes prior to the start of the webcast.

A webcast replay will be available at approximately 8:00 p.m. Eastern Standard Time on November 8, 2022. This can be accessed with the following link.

Important Information Regarding Outlook

There is no guarantee that Sprouts will achieve its projected financial expectations, which are based on management estimates, currently available information and assumptions that management believes to be reasonable. These expectations are inherently subject to significant economic, competitive and other uncertainties and contingencies, many of which are beyond the control of management. See “Forward-Looking Statements” below.

Forward-Looking Statements

Certain statements in this press release are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Any statements contained herein that are not statements of historical fact (including, but not limited to, statements to the effect that Sprouts Farmers Market or its management "anticipates," "plans," "estimates," "expects," or "believes," or the negative of these terms and other similar expressions) should be considered forward-looking statements, including, without limitation, statements regarding the company’s outlook, growth, opportunities and long-term strategy. These statements involve certain risks and uncertainties that may cause actual results to differ materially from expectations as of the date of this release. These risks and uncertainties include, without limitation, the company’s ability to execute on its long-term strategy; the company’s ability to successfully compete in its competitive industry; the company’s ability to successfully open new stores; the company’s ability to manage its growth; the company’s ability to maintain or improve its operating margins; the company’s ability to identify and react to trends in consumer preferences; product supply disruptions; equipment supply disruptions; general economic conditions that impact consumer spending or result in competitive responses; accounting standard changes; the current inflationary environment and future potential inflationary and/or deflationary trends; the impact of the COVID-19 pandemic; and other factors as set forth from time to time in the company’s Securities and Exchange Commission filings, including, without limitation, the company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The company intends these forward-looking statements to speak only as of the time of this release and does not undertake to update or revise them as more information becomes available, except as required by law.

Corporate Profile

Sprouts is the place where goodness grows. True to its farm-stand heritage, Sprouts offers a unique grocery experience featuring an open layout with fresh produce at the heart of the store. Sprouts inspires wellness naturally with a carefully curated assortment of better-for-you products paired with purpose-driven people. The healthy grocer continues to bring the latest in wholesome, innovative products made with lifestyle-friendly ingredients such as organic, plant-based and gluten-free. Headquartered in Phoenix, and one of the largest and fastest growing specialty retailers of fresh, natural and organic food in the United States, Sprouts employs approximately 31,000 team members and operates approximately 380 stores in 23 states nationwide. This year, Sprouts celebrates its 20th year anniversary. To learn more about Sprouts, and the good it brings communities, visit



    Thirteen weeks ended     Thirty-nine weeks ended  
    October 2, 2022     October 3, 2021     October 2, 2022     October 3, 2021  
Net sales   $ 1,591,026     $ 1,509,633     $ 4,827,669     $ 4,607,073  
Cost of sales     1,007,376       969,904       3,051,914       2,931,089  
Gross profit     583,650       539,729       1,775,755       1,675,984  
Selling, general and administrative expenses     460,834       423,416       1,382,854       1,299,498  
Depreciation and amortization (exclusive
of depreciation included in cost of
    30,313       30,377       93,377       92,036  
Store closure and other costs, net     2,164       128       3,034       1,757  
Income from operations     90,339       85,808       296,490       282,693  
Interest expense, net     1,951       2,911       7,648       8,840  
Income before income taxes     88,388       82,897       288,842       273,853  
Income tax provision     22,648       19,030       72,798       65,924  
Net income   $ 65,740     $ 63,867     $ 216,044     $ 207,929  
Net income per share:                        
Basic   $ 0.61     $ 0.56     $ 1.98     $ 1.78  
Diluted   $ 0.61     $ 0.56     $ 1.97     $ 1.77  
Weighted average shares outstanding:                        
Basic     107,229       114,201       109,066       116,497  
Diluted     108,095       114,818       109,888       117,252  




    October 2, 2022     January 2, 2022  
Current assets:            
Cash and cash equivalents   $ 316,042     $ 245,287  
Accounts receivable, net     11,455       21,574  
Inventories     301,667       265,387  
Prepaid expenses and other current assets     43,867       35,468  
Total current assets     673,031       567,716  
Property and equipment, net of accumulated depreciation     694,098       716,029  
Operating lease assets, net     1,081,514       1,072,019  
Intangible assets, net of accumulated amortization     184,960       184,960  
Goodwill     368,878       368,878  
Other assets     15,036       13,513  
Total assets   $ 3,017,517     $ 2,923,115  
Current liabilities:            
Accounts payable   $ 166,968     $ 145,901  
Accrued liabilities     144,935       155,996  
Accrued salaries and benefits     53,875       58,743  
Current portion of operating lease liabilities     158,219       151,755  
Current portion of finance lease liabilities     1,141       1,078  
Total current liabilities     525,138       513,473  
Long-term operating lease liabilities     1,095,154       1,095,909  
Long-term debt and finance lease liabilities     258,992       259,656  
Other long-term liabilities     38,486       36,306  
Deferred income tax liability     58,919       57,895  
Total liabilities     1,976,689       1,963,239  
Commitments and contingencies            
Stockholders' equity:            
Undesignated preferred stock; $0.001 par value; 10,000,000 shares
authorized, no shares issued and outstanding
Common stock, $0.001 par value; 200,000,000 shares authorized,
106,491,322 shares issued and outstanding, October 2, 2022;
111,114,374 shares issued and outstanding, January 2, 2022
    106       111  
Additional paid-in capital     720,447       704,701  
Accumulated other comprehensive income (loss)     498       (3,758 )
Retained earnings     319,777       258,822  
Total stockholders' equity     1,040,828       959,876  
Total liabilities and stockholders' equity   $ 3,017,517     $ 2,923,115  



    Thirty-nine weeks
    Thirty-nine weeks
    October 2, 2022     October 3, 2021  
Operating activities            
Net income   $ 216,044     $ 207,929  
Adjustments to reconcile net income to net cash provided by operating activities:            
Depreciation and amortization expense     96,057       94,422  
Operating lease asset amortization     87,316       80,295  
Store closure and other costs, net     171        
Share-based compensation     11,672       11,304  
Deferred income taxes     1,025       2,085  
Other non-cash items     404       883  
Changes in operating assets and liabilities:            
Accounts receivable     16,491       12,999  
Inventories     (36,280 )     (16,860 )
Prepaid expenses and other current assets     (7,880 )     (6,001 )
Other assets     1,678       (2,834 )
Accounts payable     23,121       29,479  
Accrued liabilities     2,482       1,046  
Accrued salaries and benefits     (4,868 )     (30,544 )
Operating lease liabilities     (99,055 )     (88,664 )
Other long-term liabilities     (1,588 )     1,120  
Cash flows from operating activities     306,790       296,659  
Investing activities            
Purchases of property and equipment     (80,749 )     (70,010 )
Cash flows used in investing activities     (80,749 )     (70,010 )
Financing activities            
Payments on finance lease liabilities     (600 )     (507 )
Payments of deferred financing costs     (3,373 )      
Repurchase of common stock     (155,094 )     (137,484 )
Proceeds from exercise of stock options     4,074       1,918  
Cash flows used in financing activities     (154,993 )     (136,073 )
Increase in cash, cash equivalents, and restricted cash     71,048       90,576  
Cash, cash equivalents, and restricted cash at beginning of the period     247,004       171,441  
Cash, cash equivalents, and restricted cash at the end of the period   $ 318,052     $ 262,017  

Non-GAAP Financial Measures

In addition to reporting financial results in accordance with accounting principles generally accepted in the United States (“GAAP”), the company presents EBITDA and EBIT. These measures are not in accordance with, and are not intended as alternatives to, GAAP. The company's management believes that this presentation provides useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses these measures for reviewing the financial results of the company, and certain of these measures may be used as components of incentive compensation.

The company defines EBITDA as net income before interest expense, provision for income tax, and depreciation, amortization and accretion.

Non-GAAP measures are intended to provide additional information only and do not have any standard meanings prescribed by GAAP. Use of these terms may differ from similar measures reported by other companies. Because of their limitations, non-GAAP measures should not be considered as a measure of discretionary cash available to use to reinvest in the growth of the company’s business, or as a measure of cash that will be available to meet the company’s obligations. Each non-GAAP measure has its limitations as an analytical tool, and they should not be considered in isolation or as a substitute for analysis of the company’s results as reported under GAAP.

The following table shows a reconciliation of EBITDA to net income for the thirteen and thirty-nine weeks ended October 2, 2022 and October 3, 2021:



Weeks Ended
Weeks Ended
Weeks Ended
Weeks Ended
    October 2, 2022     October 3, 2021     October 2, 2022     October 3, 2021  
Net income   $ 65,740     $ 63,867     $ 216,044     $ 207,929  
Income tax provision     22,648       19,030       72,798       65,924  
Interest expense, net     1,951       2,911       7,648       8,840  
Earnings before interest and taxes (EBIT)     90,339       85,808       296,490       282,693  
Depreciation, amortization and accretion     31,201       31,270       96,057       94,422  
EBITDA   $ 121,540     $ 117,078     $ 392,547     $ 377,115  


Investor Contact: Media Contact:
Susannah Livingston
(602) 682-1584  

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Source: SFM, LLC d/b/a Sprouts Farmers Market