UNFI reports sales, profit increases in 3Q, revises outlook for FY15

PROVIDENCE – United Natural Foods Inc. reported an increase in sales and profit in its fiscal third quarter, but the company fell short of analysts’ estimates.
The distributor of natural, organic and specialty products reported $2.1 billion in sales for the three-month period that ended May 2, an 18.7 percent increase compared with the same prior-year period.
Profit rose 14.7 percent to $41.8 million, or 83 cents per diluted share, compared with $36.4 million, or 73 cents per diluted share, in the year-ago quarter. This also includes a gain of $4.2 million associated with a transfer of land at the company’s Prescott, Wis., facility.
Analysts had projected profit of 85 cents per share and revenue of $2.14 billion.

Based on the third-quarter results, the company lowered its expectations for revenue for the remainder of fiscal 2015, which ends Aug. 1. It now is expecting sales ranging from $8.15 billion to $8.19 billion, an increase of 20 percent to 20.5 percent compared with fiscal 2014. It previously said it had expected sales between $8.19 billion to $8.29 billion.

“While comparable sales growth moderated in the quarter, we believe that this is a short-term trend,” Steven Spinner, president and CEO, said in a statement. “Demand for organic, gourmet and ethnic products continues to increase, and we have seen sales growth accelerate modestly in the first few weeks of our fourth quarter.”
Sales were boosted by approximately $213.7 million from the company’s acquisition of Tony’s Fine Foods in the fourth quarter of fiscal 2014.
“Our acquisition of Tony’s Fine Foods, which expanded our presence in fresh foods, has exceeded our expectations as consumer interests continue to shift towards the perimeter of the store,” Spinner said. “In combination with our Albert’s Organics business, UNFI is well-positioned to capitalize on the consumers’ demands for fresh products. Additionally, UNFI’s investment in refrigerated infrastructure will serve as a catalyst towards increased growth and market share as the platform moves across the country.”

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