UNFI's Profits Take Hit in Q4
United Natural Foods, Inc. (UNFI) has shared its fourth quarter and fiscal year financial results for the period ended July 29, 2023.
For the 13-week period, net sales increased 2.0% to $7.4 billion, primarily driven by inflation and new business. According to UNFI, this new business resulted from selling new or expanded categories to existing customers and adding new customers. Unit volumes declined overall, impacting the net sales.
Gross profit in the fourth quarter of fiscal 2023 was $1.0 billion, a decrease of $87 million, or 8.3%, compared to the fourth quarter of fiscal 2022. The gross profit rate in the quarter was 13.0% of net sales. Operating expenses in the quarter were $1.004 billion, or 13.5% of net sales, compared to $980 million in the same quarter in 2022. Net loss for the fourth quarter of fiscal 2023 was $68 million, up from $39 million year-over-year.
“Our fourth quarter concluded a challenging year in which we continued to emphasize serving customers and suppliers, and we also worked diligently to improve operating effectiveness, efficiency and our technological capabilities,” said UNFI CEO Sandy Douglas. “While we grew sales across all of our customer channels, profitability declined primarily due to a decrease in inflation driven procurement gains and elevated shrink. We expect further headwinds as we continue to cycle elevated inflationary benefits during the first half of fiscal 2024.”
For the full fiscal year, net sales were $30.2 billion, an increase of 4.6% compared to the 2022 results, which were in-line with UNFI’s most recent outlook. For fiscal 2024, the company expects net sales between $30.9-31.5 billion.
“We’re continuing to invest in our supply chain and technology infrastructure to improve our cost structure and enhance the customer and supplier experience,” said Douglas. “We’re confident that combining our industry leading position with a more dynamic and nimble UNFI under the guidance of our newly refreshed board puts us on a strong path to drive meaningful and sustainable long-term shareholder value creation.