United Natural Foods, Inc. today announced results for the third quarter of fiscal 2000, ending April 30, 2000, in line with the Company’s recent guidance and analysts estimates.
Net sales for fiscal year 2000’s third quarter totaled $229.2 million compared with $226.9 million recorded in the third quarter a year ago. Excluding the impact of the closure of the Company’s Chicago facility, net income for the current quarter was $2.0 million, or $0.11 per share. Including expenses related to the closure of the Company’s Chicago facility, net income for the 2000 third quarter was $1.8 million or $0.10 per share. These expenses include approximately $0.2 million, net of tax, of operating costs incurred to close the Company’s Chicago facility.
Management attributes these results to the previously discussed issues related to the consolidation of its Eastern Region systems and operations which have resulted in lower sales growth, lower gross margins and higher operating expenses in the Eastern Region.
Commenting on the Company’s performance, Chief Executive Officer Michael Funk said, “We are very pleased to report a turnaround in the performance of the Company and the achievement of our third quarter earnings targets. Operations are fully restored in the Eastern Region and we have begun to recognize the benefits of recent operational changes intended to return United Natural Foods to profitability. Accordingly, fill rates have returned to 95% at all Eastern Region facilities and inventory levels have returned to 55 days on hand.”
Mr. Funk continued, “As expected, revenues were negatively impacted this quarter by the divestiture of 4 retail stores in April 1999 and the closing of our Chicago facility in March 2000. Furthermore, while sales in all other divisions experienced low to mid teen growth, sales in the Eastern Region continued to be soft. We are committed to improve the focus on our customers while concentrating efforts in the coming quarters to build operating margin and sales in the Eastern Region.”
United Natural Foods, Inc. distributes over 30,000 products to more than 6,500 customers in 50 states. The Company serves a wide variety of retail formats including conventional supermarket chains, natural product superstores and independent retail operators.
United Natural Foods management will host a conference call to discuss its third quarter results at 11:00 a.m. (Eastern Standard Time) on June 6, 2000. The conference may be accessed by dialing 703-871-3022 just prior to the scheduled start time. The call may also be accessed on the Internet at www.vcall.com.
For more information on United Natural Foods, Inc., via fax at no charge, please dial 1-800-PRO-INFO and enter the Company’s ticker symbol, UNFI.
This press release contains forward-looking statements relating to the operations of the Company and such statements involve a number of risks and uncertainties. Actual results may differ materially from those projected in the forward-looking statements. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company’s SEC filings, including its periodic reports filed under the Securities Exchange Act of 1934, as amended (copies of which are available upon request from the Company’s investor relations department).
UNITED NATURAL FOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
QUARTER ENDED NINE MONTHS ENDED
APRIL 30, APRIL 30,
(In thousands, except
per share data)
2000 1999 2000 1999
Net sales $ 229,205 $ 226,892 $ 679,035 $ 642,529
Cost of sales 183,900 178,953 551,107 505,768
Gross profit 45,305 47,939 127,928 136,761
Operating expenses 40,561 36,893 126,736 105,133
Restructuring and asset
impairment charges – 1,538 2,420 2,243
intangibles 278 245 828 844
expenses 40,839 38,676 129,984 108,220
Operating income 4,466 9,263 (2,056) 28,541
Other expense (income):
Interest expense 1,666 1,401 4,573 4,470
Other, net (140) (1,488) (345) (1,847)
Total other expense 1,526 (87) 4,228 2,623
Income before income
taxes 2,940 9,350 (6,284) 25,918
Income taxes 1,175 4,231 (2,503) 11,104
Net income $1,765 $5,119 $(3,781) $14,814
Per share data (basic):
Net income $0.10 $0.28 $(0.21) $0.81
Weighted average shares
of common stock 18,261 18,183 18,260 18,178
Per share data (diluted):
Net income $0.10 $0.28 $(0.21) $0.80
Weighted average shares
of common stock 18,562 18,512 18,260 18,529
SELECTED BALANCE SHEET INFORMATION
Accounts receivable, net $76,635
Inventory $ 101,919
Total bank debt $87,362