UNFI Q4 results: net sales up 8%, income dips 9.3%

Wholesaler United Natural Foods Inc. (UNFI) reported net sales for the company's fiscal fourth quarter, which ended July 30, were up 8% year over year to $7.3 billion. Net income, though, decreased 9.3% over the year-ago period, to $39 million. The decrease in net income is due to a higher last in, first out (LIFO) charge, partially offset by net pension and benefit plan charges incurred last year, the Providence, Rhode Island-based company said Tuesday. 

“Our fourth quarter capped a year of improving operational performance driving strong financial results,” UNFI CEO Sandy Douglas said in a statement. “Our commitment to delivering higher customer service levels amidst significant industry and economic uncertainty helped us achieve market share gains. We also generated meaningful growth across our key financial metrics, including mid-teens adjusted earnings growth ..."

Adjusted EBITDA for the fourth was $213 million, compared to $206 million for the same period last year, UNFI reported. Gross margin rate in the fourth quarter of fiscal 2022 was 14.5% of net sales and included a $56 million LIFO charge. Net income per diluted share was 63 cents for the fourth quarter of fiscal 2022, compared to net income per diluted share of 69 cents for the fourth quarter of fiscal 2021. 

“As we look to the new fiscal year, we see great opportunity to further harness our competitive advantages, including our scale, network, data, diversification and talent, to continue to improve our execution and drive even higher levels of value for our customers, suppliers, associates and our shareholders. We plan to build on our momentum by investing to accelerate long-term growth, efficiency and value creation, while continuing to strengthen our balance sheet,” Douglas said.

As the company looks to the end of its fiscal year, the organic and specialty foods distributor said it expects revenue in the range of $29.8 billion to $30.4 billion.

“As we embark on year two of our Fuel the Future strategy, we are pleased to announce our fiscal 2023 outlook and our capital reinvestment plans, while we seek to opportunistically repurchase shares through our newly authorized program,” Douglas said.

An example of Symbotic's A.I.-powered Robotic Automation System for optimized mixed-SKU pallets. Photo courtesy of UNFI. 

Looking to improve its supply chain systems, UNFI said Monday it has entered an agreement with Symbotic to implement industry-leading warehouse automation systems which will include an A.I.-powered robotic and software platform. The commercial agreement will implement Symbotic’s A.I.-powered robotics and software automation in five of UNFI’s distribution centers over the next four years.

“We’re pleased to introduce Symbotic systems into our distribution network, which we believe will benefit our customers, suppliers and associates,” said Mark Bushway, UNFI’s chief supply chain officer. “We currently have automation in a number of our distribution centers, but we believe the Symbotic System will improve the accuracy, efficiency, quality and speed of our supply chain and help take our operations to a new level.”

Wholesaler UNFI serves about 30,000 independent grocers.