UNFI reports sales increase, profit decrease in 2Q

SALES INCREASED 22.5 percent to $2.02 billion in the second quarter that ended Jan. 31, from $1.6 billion in the second quarter of 2014, for United Natural Foods. / COURTESY UNITED NATURAL FOODS
SALES INCREASED 22.5 percent to $2.02 billion in the second quarter that ended Jan. 31, from $1.6 billion in the second quarter of 2014, for United Natural Foods. / COURTESY UNITED NATURAL FOODS

PROVIDENCE – United Natural Foods Inc., a distributor of natural, organic and specialty products, released second-quarter earnings this week, showing an increase in sales, but a decline in profit.
Sales increased 22.5 percent to $2.02 billion in the quarter that ended Jan. 31, from $1.6 billion in the same 2014 period. Second-quarter profit slipped 0.4 percent to $27.8 million, or 55 cents per diluted share, compared with $28 million, or 56 cents per diluted share, during the year-ago period.
“In the second quarter fiscal 2015 UNFI surpassed $2 billion in quarterly net sales for the first time in its history, continuing to demonstrate strong demand for our products and services. We also faced several challenges during the quarter highlighted by weakness in the Canadian dollar and a non-recurring reduction to net sales associated with a contractual obligation to a customer that we identified and brought to their attention. Despite these challenges we delivered on an adjusted basis operating income growth of over 17 percent during the quarter and 21 percent year to date,” Steven Spinner, president and CEO, said in a statement.
“During the quarter we continued to improve our business through increasing capacity and network optimization. Specifically, we opened two new distribution centers and closed an underperforming location in Quebec, Canada, merging it into our Montreal facility. We’ve made long-term strategic decisions to ensure that our growth rate continues despite the short-term cost,” Spinner said.
UNFI said the second quarter featured sales of approximately $232.6 million from its acquisition of Tony’s Fine Foods in the fourth quarter of fiscal 2014. In the second quarter, the company recognized a non-recurring reduction in net sales of $7.7 million to reflect amounts owed to a customer resulting from an incorrect calculation of contractual obligations to a customer from fiscal 2009 through fiscal 2014. UNFI said the reduction in net sales related to this incorrect calculation was $9.3 million, which includes a $1.6 million reduction in net sales in the first quarter of fiscal 2015.
The company also updated its outlook for fiscal 2015, which ends Aug. 1, saying revenue is expected in the range of $8.19 billion to $8.29 billion, an increase of approximately 20.5 percent to 22 percent compared with fiscal 2014.

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