FOOL CONFERENCE CALL SYNOPSIS*
By Debora Tidwell (MF Debit)

Whole Foods Market, Inc.
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601 North Lamar, Suite 300
Austin, TX 78703
(512) 477-4455
http://www.wholefoods.com/wf.html

UNION CITY, Ca., November 11, 1996/FOOLWIRE/ --- Whole Foods Market released their fourth quarter 1996 earnings on Friday, November 8th. Fiscal 1996 was the best year in their company's history in almost every respect. They ended the year with 68 stores and sales of $892 million, an increase of 23% over last year. Their combined earnings for the year were $12.7 million or $0.64 per share compared to last year's earnings of $5.6 million or $0.30 per share. Their comp store sales for the year were 5.4%.

FOURTH QUARTER RESULTS. For the fourth quarter their sales were $230 million, an increase of 24% over last year. They earned $0.16 per share for the quarter or $3.1 million compared to a loss last year of $175,000 for the combined companies. Comps for the quarter were 4.3%.

FRESH FIELDS COSTS LOWER. Fresh Fields has historically had lower costs than Whole Foods due primarily to their concentrated growth within certain market areas which has led to a high degree of self-cannibalization. The fourth quarter includes a significant charge to earnings associated with the merger. The $36 million is higher than their previous estimates but reflects a very thorough audit of the Fresh Fields balance sheets and updated cost projections from terminating leases on 5 locations.

LOOKING FORWARD TO 1997, they expect their comps to stay level in the first quarter and then begin to accelerate for the balance of the year as some of their newer stores join the comp base and some stores they intentionally cannibalized last year begin comparing against lower sales. While the merger was dilutive to their results for fiscal year 1996, they are confident that the Fresh Fields stores will contribute strongly to their earnings in fiscal 1997.

SOUTHERN CALIFORNIA. In Southern California their business is still flat. Sales have declined approximately 5-10% since they changed the name in late August from Mrs. Gooch's to Whole Foods Market. In Southern California where they don't have name recognition, there is the 20 years of goodwill that Mrs. Gooch's has built up that has temporarily been disruptive when the changed the name. This has never happened to them before in prior name changes and they believe that this is a short term phenomenon that will reverse itself as they continue to rennovate and upgrade the stores and tell the story there about who they are. They are marketing their new name in Southern California extensively and are executing very well at the store level. They also note that their entry into the San Diego market this year will help build momentum in the region. However, the impact of the name change in Southern California has caused them to take a more cautious approach regarding changing the name of the Fresh Fields stores on the East Coast.

FRESH FIELDS -- NO NAME CHANGE IN DC MARKET. Their theory at this point is that Washington DC and Philadelphia are markets where Fresh Fields has built up tremendous goodwill in the last five years. There are more natural food sales occurring in Washington DC, for example, than any other city in the United States. So, they are loathe to mess with that good will. They now plan to leave the Fresh Fields name in place in Philadelphia and the Washington DC area and add Whole Foods Market underneath the Fresh Fields name as they did in Bread and Circus after the merger in 1992 . In the Midwest, where the Whole Foods name is well established and Fresh Fields has only been operating there for one year, they don't have the same type of goodwill established so they will move forward and change the name there. They've done this already in Evanston and sales there are at record levels. They are waiting to see how the Chicago area name changes go before they determine what to do with the New York stores.

FRESH FIELDS INTEGRATION GOING WELL. On the whole the integration of Fresh Fields into Whole Foods is going very well. The respective strengths and weaknesses of both companies are very complementary. Any merger process they know takes time, and it will take a minimum of a year for this integration to be completed. Shortly after the first of the year they will begin rennovating some of the Fresh Fields stores. They have already placed their private label products in Fresh Fields and removed the products they sold that did not meet their quality standards. The response from their customers and team members has been very positive.

NEW STORE OPENINGS GOING WELL. They are particularly proud of the results in the new stores they opened in the fourth quarter. They opened three locations in California -- downtown San Francisco, West Los Angeles, and in Cupertino. Sales are strong in all three locations and all of the stores are already profitable. Improving performance of their new stores has been a major focus in the last year and these results are evidence of their success in this area.

NEW STORES COMING IN Q1. The quality of their real estate and store level executions, they feel, is second to none in the natural products industry. Looking forward to the first quarter, they will open three stores -- the Vienna Virginia store which opened on Friday November 8th, their first store in the San Diego market in La Jolla next week, and in the first week of January they will open in Center City Philadelphia. They are very confident that all of these stores will continue their string of successful openings.

FY 1997 WILL BE STRONG. They anticipate this coming year to be another strong one for the company. They have some excellent sites in inventory and the improved performance of their new stores should contribute very favorably to their sales and earnings in 1997. They believe they have positioned the company very well for the long term by establishing a dominant market position for natural and organic foods in nine out of the ten major metropolitan markets in the country. Despite ever increasing competition in the marketplace, they are very confident in their ability to continue to deliver strong results for their shareholders.

* A Fool conference call synopsis represents an effort to highlight the salient points of a conference call and should not be taken as an authoritative accounting or transcription of the entire event. Note: Statements made by a company other than historical information may constitute forward-looking statements for which the company can claim protection under the Safe Harbor Act. Please consult the company's filings with the SEC for information on risk factors which might cause actual results to differ materially from the information contained in these forward-looking statements.