UNFI reports $341.7M loss related to SUPERVALU writedowns, costs

UNITED NATURAL FOODS reported a loss of $341.7 million in the quarter ended Jan. 26.
UNITED NATURAL FOODS reported a loss of $341.7 million in the quarter ended Jan. 26.

PROVIDENCE – United Natural Foods Inc. reported a loss of $341.7 million in the quarter ended Jan. 26, largely related to the company’s acquisition of SUPERVALU.

Loss per diluted share was $6.72 per share for the quarter. One year prior, the company reported a $50.5 million profit, or 99 cents per diluted share.

The company said that it incurred a goodwill impairment charge of $370.9 million and $47.1 million in restructuring, acquisition and integration expenses related to the acquisition. The company also reported a $8.6 million inventory fair adjustment charge related to SUPERVALU.

Revenue for the quarter totaled $6.1 billion, a sharp increase from $2.5 billion one year prior. The increase was largely attributed to $3.5 billion in revenue from SUPERVALU. The company also noted that UNFI legacy sales increased 5.8 percent year over year.

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“I’m pleased by the tremendous work and meaningful progress our team accomplished this quarter on the integration of SUPERVALU and the positioning of UNFI as the premier food distribution company in North America,” said Steven L. Spinner, UNFI chairman and CEO, in prepared remarks. “We know realizing all the benefits of this combination will take time, and we’re focused on executing against our plan for the long-term. We experienced higher than anticipated costs, largely associated with our network realignment projects resulting primarily from SUPERVALU’s previous acquisitions, which we believe will be short term in nature.”

The company completed its $2.3 billion takeover of SUPERVALU on Oct. 22, paying $1.3 billion in cash to SUPERVALU shareholders and using $1 billion to satisfy the company’s debt obligations.

The company has also been divesting in some of the brands owned by SUPERVALU. In December, the company completed its sale of Hornbacher’s and announced a long-term supply contract with the new sold entity. The company also said that it plans to complete the sale of the remaining five Shop’n Save stores not yet sold or closed by the end of the third quarter.

Chris Bergenheim is the PBN web editor. Email him at Bergenheim@PBN.com.

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