UNFI reports profit decline, sales increase in 1Q

PROVIDENCE – United Natural Foods Inc. saw a decrease in profit, but an increase in sales in first-quarter results released this week.
UNFI, which carries and distributes more than 85,000 natural, organic and specialty food products to more than 40,000 customers throughout the United States and Canada, said profit was $30.1 million, or 60 cents per diluted share, compared with profit of $33 million, or 66 cents per share, during the 2014 first quarter, a decline of 8.8 percent.
Revenue reached $2 billion in the first quarter that ended Oct. 31, an increase of 4.2 percent compared with 2014 first-quarter revenue of $1.99 billion.
President and CEO Steven Spinner said first-quarter results reflect an “evolving marketplace for natural and organic foods.”
“As consumers demand healthier options, rapid adoption of natural and organic products across sales channels has increased the competitive nature of our industry,” he said.

Despite these trends, Spinner said customers have demonstrated confidence in the company by extending contracts valued at more than $785 million per year, noting Whole Foods Market also has extended its contract until 2025.
The company has been the primary distributor for Whole Foods for more than 17 years and it represented 35 percent of net sales in fiscal 2015, which were in excess of $8 billion, UNFI Senior Vice President, Chief Financial Officer and Treasurer Mike Zechmeister has said.

Spinner said the contracts, combined with opportunities in gourmet and ethnic products, as well as fresh foods, represent “tremendous incremental long-term growth opportunities for UNFI as we focus on our mission to connect farms to families by delivering healthier food options to more people every day.”

UNFI also updated its financial outlook for the remainder of fiscal 2016, saying it is estimating sales between $8.4 billion and $8.59 billion, an increase of 3 to 5 percent compared with 2015’s numbers; full-year earnings are expected to be between $2.79 and $2.89.

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