UNFI Delivers Mixed Q4, Solid Full-Year Results

Company also partnering with Symbotic on warehouse automation

9/27/2022

In addition to sharing its Q4 and FY22 fiscal results, UNFI revealed a partnership with Symbotic to bring automation to five of its warehouses.

Grocery wholesaler United Natural Foods, Inc. (UNFI) has released its fourth quarter and full-year results, revealing a solid fiscal 2022 punctuated by a 66.4% increase in net income to $248 million. The company also saw net sales grow 7.3% to $28.9 billion and adjusted EBITDA increase 7.7% to $829 million.

As for fourth quarter, UNFI saw net sales growth of 8% to $7.3 billion, while net income decreased 9.3% to $39 million. Adjusted EBITDA was up 3.4% to $213 million and adjusted EPS increased 1.6% to $1.27. An increase in operating costs was related to higher transportation and distribution center labor costs, as well as occupancy-related inflation.

“Our fourth quarter capped a year of improving operational performance driving strong financial results. Our commitment to delivering higher customer service levels amidst significant industry and economic uncertainty helped us achieve market share gains,” said UNFI CEO Sandy Douglas. “We also generated meaningful growth across our key financial metrics, including mid-teens adjusted earnings growth, while we reduced net leverage to under 2.6x and increased liquidity to approximately $1.7 billion.”

Last week, UNFI’s board of directors approved a new stock repurchase program that authorizes the company to repurchase up to $200 million of its shares over four years. The new repurchase program replaces the one that was enacted in 2017 and is expected to be executed through open market transactions, privately negotiated transactions or other means as necessary.

“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 ever higher levels of value for our customers, suppliers, associates and our shareholders,” Douglas continued. “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.”

UNFI expects additional growth for fiscal year 2023, including a 4% increase in net sales to $29.8-$30.4 billion and $247-$266 in net income, a 3% increase from FY22.

In addition to its financial results, UNFI announced a partnership with Wilmington, Mass.-based Symbotic Inc. to implement the automation technology company’s artificial intelligence-powered robotics and software automation in five of UNFI’s distribution centers over the next four years. The end-to-end automation system has robotic case pick capabilities and is designed to enable UNFI to enhance capabilities and efficiency, improve order accuracy, increase storage capacity within facilities, and facilitate future growth.

“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.”

Providence, R.I.-based UNFI delivers a wide variety of products to customer locations throughout North America, including natural product superstores, independent retailers, conventional supermarket chains, e-commerce retailers and foodservice customers. The largest publicly traded grocery distributor in America, the company is No. 49 on The PG 100, Progressive Grocer's 2022 list of the top food and consumables retailers in North America.