UNFI Delivers Solid Quarter of Sales Growth
While it works through a recently announced cyberincident, United Natural Foods Inc. (UNFI) has reported its financial results for the third quarter of fiscal 2025, ended May 3.
Net sales increased 7.5% to $8.1 billion in Q3 compared with the same period in the prior year, primarily driven by a 4% bump in wholesale unit volumes, including the benefit of new business with existing and new customers, as well as inflation. This performance was led by natural product growth.
Gross profit was $1.1 billion, a $62 million increase, or 6.1%. The gross profit rate in the Q3 was 13.4% of net sales compared with last year’s 13.6% of net sales. The decrease was primarily driven by lower product margin rates and business mix, partly offset through supplier programs and lower shrink.
Operating expenses were $1,025 million, or 12.7% of net sales, compared with last year's $992 million, or 13.2% of net sales. The company attributed the decrease to leveraging the impact of higher sales, and the benefits from cost-saving initiatives.
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Net loss for UNFI's Q3 of fiscal 2025 was $7 million. Net loss for Q3 of fiscal 2024 was $21 million.
Net loss per diluted share was 12 cents, compared with last year's 34 cents. Adjusted EPS was 44 cents for Q3 of fiscal 2025, compared with last year's 10 cents.
Adjusted EBITDA increased 20.8% to $157 million.
“During the third quarter, our customers helped us deliver another solid quarter of sales growth and our seventh consecutive quarter of sequentially improving adjusted EBITDA. I’m pleased that our focus on becoming a more efficient and effective value-adding partner for our customers and suppliers is leading to steady margin improvement, including a higher year-over-year adjusted EBITDA margin rate and increased free cash flow,” said Sandy Douglas, UNFI’s CEO.
“In the near term, we are focused on diligently managing through the cyberincident we announced yesterday to rapidly and safely restore our capabilities, while helping our customers with short-term solutions wherever possible,” added Douglas
A cyberattack was discovered on Thursday, June 5, forcing the company to take some systems offline, which affected customer orders. The company notified law enforcement and is currently investigating the incident.
During the company's earnings call, Douglas said, "Pursuant to our business continuity plans, we have implemented workarounds for certain operations in order to continue servicing our customers where possible, and we’re continuing to safely bring our systems back online and restore broad-based customer service as soon as possible."
One of the largest publicly traded wholesale distributors of health and specialty food in North America, UNFI delivers products to more than 30,000 locations, including natural product superstores, independent retailers, conventional supermarket chains, e-commerce providers and foodservice customers. The company is No. 20 on The PG 100, Progressive Grocer’s 2025 list of the top food and consumables retailers in North America.
