UNFI Posts 11.2 Percent Q2 Surge; Plans Wash. Facility

DAYVILLE, Conn. -- Recent stunning growth of organic and natural food products has yet to level off, and neither has growth at United Natural Foods, Inc. (UNFI), based here, which yesterday reported net sales for the second quarter of fiscal 2007 of $668.5 million, an increase of about $67.5 million, or 11.2 percent, from the $601.1 million recorded last year.

UNFI posted net income of $10.9 million, or 25 cents per share, for the quarter ended Jan. 27, 2007. After adjusting for the impact of losses attributable to two Auburn, Calif. facilities and the early termination of a Minnesota facility and a related asset write-off, net income for the quarter would have been $12.7 million, or 30 cents per diluted share. Net income for the second quarter, excluding special items, was $10.8 million, or 26 cents per diluted share. Including special items, net income was $10.6 million, or 25 cents per diluted share.

"Fiscal 2007 continues to be a strong year, and we are quite pleased with our operating performance and financial results during the second quarter," said UNFI president and c.e.o. Michael Funk in a statement. "Sales growth in our supermarket channel remained solid, and we expect the super natural channel to realize increased sales growth with the number of new stores expected to open during 2007. I am also pleased to report that the transition during the quarter related to our expanded Whole Foods relationship in the Southern Pacific region of the United States has gone smoothly. We continue to develop operational efficiencies while servicing our customers at a high service level."

The company also said yesterday that it would expand its operations in the Pacific Northwest region by building a new 237,000 square foot state-of-the-art distribution center in Ridgefield, Wash. The facility is scheduled to open in the late summer of 2007.

The DC will serve as a regional distribution hub for customers in Portland, Ore. and other Northwest states. UNFI currently has 16 distribution facilities acrross the United States, consisting of an aggregate of 3.3 million square feet of space -- the largest capacity of any distributor in the natural products industry, according to the company.

"To accommodate anticipated industry growth and accelerating consumer demand for natural and organic products, we are pleased to announce plans to open a new facility in the Pacific Northwest," noted Funk. "Supporting our commitment to our customers, the Ridgefield distribution center will improve our distribution capabilities and provide customers with further product diversity and enhanced customer service. The new distribution center will also allow us the opportunity to create new sales opportunities in this region, and will provide lower transportation costs to our customers."

UNFI carries and distributes more than 40,000 products to more than 18,000 customers nationwide. The company serves a wide variety of retail formats including conventional supermarket chains, natural product superstores, independent retail operators, and the foodservice channel.
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