Company Announces Acquisition of Global Organic/Specialty Source, Inc.
PROVIDENCE, R.I.--(BUSINESS WIRE)--Mar. 7, 2016--
United Natural Foods, Inc. (Nasdaq: UNFI) (the "Company" or "UNFI")
today reported financial results for the second fiscal quarter and six
months ended January 30, 2016. The Company also announced today that it
has acquired certain assets of Global Organic/Specialty Source, Inc. and
certain of its related affiliates (collectively “Global Organic”).
Second Quarter Fiscal 2016 Highlights
-
Net sales increased 1.5% to $2.05 billion compared to $2.02
billion for the same period last fiscal year.
-
Adjusted net sales increased 6.5% compared to the same period last
fiscal year, excluding the year-over-year impact of the previously
disclosed termination of a customer distribution contract and, for the
second quarter of fiscal 2015, the previously disclosed non-recurring
reduction in net sales.
-
Diluted EPS was $0.45 compared to $0.55 for the same period last
fiscal year.
-
Adjusted diluted EPS was $0.49, excluding $2.0 million of severance
and other transition costs related to a previously announced
restructuring plan and approximately $1.0 million of acquisition
related costs.
-
Free cash flow generation of $106.2 million, the largest free cash
flow quarter in Company history.
“We are intently focused on managing our business in a rapidly changing
environment. We will make strategic investments to improve our sales
growth rate and customer experience through the back half of this fiscal
year and into fiscal 2017,” said Steven Spinner, President & CEO. “We
are working to build new distribution opportunities and expand our
relationships with current customers. Our announcement today of the
acquisition of certain assets of Global Organic further demonstrates our
strategic focus on increasing UNFI’s product offering into the
perishable perimeter. We believe our infrastructure, supply chain and
logistics network are uniquely positioned to add meaningful value to
customers in an evolving food retail environment.”
Net sales for the second quarter of fiscal 2016 increased 1.5%, or $31.2
million, to $2.05 billion from $2.02 billion in the second quarter of
fiscal 2015. Excluding the year-over-year impact of the termination of a
customer distribution contract and the impact of the second quarter
fiscal 2015 non-recurring reduction in net sales, adjusted net sales
increased 6.5% compared to the second quarter of fiscal 2015. Gross
margin decreased 31 basis points to 14.5% for the second quarter of
fiscal 2016 compared to 14.8% for the same period last year. The
decrease in gross margin was primarily due to competitive pricing
pressures, moderated supplier promotional activity, a shift in the mix
of sales towards lower margin sales channels, the unfavorable impact of
foreign exchange for the Company's Canadian business, and a reduction in
fuel surcharges.
Total operating expenses were 12.5% as a percentage of net sales for the
second quarter of fiscal 2016, an increase of 11 basis points compared
to the same period last fiscal year. Total operating expenses increased
$6.1 million to $255.8 million for the second quarter of fiscal 2016
compared to $249.7 million in the second quarter of fiscal 2015. Total
operating expenses for the second quarter of fiscal 2016 included $2.0
million of severance and other transition costs related to the
previously announced restructuring plan and approximately $1.0 million
of acquisition related costs. Total operating expenses for the second
quarter of fiscal 2015 included approximately $0.6 million of costs
related to the startup of the Company's Hudson Valley, New York and
Auburn, California facilities and a $0.2 million restructuring charge
due to the closure of the Company's Aux Mille facility located in
Quebec, Canada.
Operating income decreased $7.8 million to $41.7 million for the second
quarter of fiscal 2016 compared to $49.5 million for the second quarter
of fiscal 2015. As a percentage of net sales, operating income for the
second quarter of fiscal 2016 decreased 41 basis points to 2.0% compared
to the same period last fiscal year.
Net income for the second quarter of fiscal 2016 decreased $5.2 million
to $22.7 million, or $0.45 per diluted share, from $27.8 million, or
$0.55 per diluted share, for the second quarter of fiscal 2015.
Excluding $2.0 million of restructuring costs and approximately $1.0
million of acquisition related costs in the second quarter of fiscal
2016, adjusted net income decreased $8.1 million to $24.5 million, or
$0.49 per diluted share, compared to adjusted net income of $32.5
million, or $0.65 per diluted share, in the second quarter of fiscal
2015, which excludes the impact of the non-recurring reduction in net
sales.
Operating cash flow and capital expenditures for the second quarter of
fiscal 2016 were $119.1 million and $12.9 million, respectively,
resulting in free cash flow of $106.2 million, the largest free cash
flow quarter in Company history.
Fiscal 2016 Year to Date Summary
Net sales for the six months ended January 30, 2016 totaled $4.12
billion, a 2.9% increase over the comparable prior fiscal year period.
Excluding the year-over-year impact of the termination of a customer
distribution contract and the impact of the second quarter fiscal 2015
non-recurring reduction in net sales, adjusted net sales increased 6.7%
compared to the six months ended January 31, 2015.
Gross margin decreased 59 basis points to 14.8% compared to the six
months ended January 31, 2015. This decrease was primarily due to the
same factors noted above for the second quarter of fiscal 2016 and
consistent with the first quarter of fiscal 2016.
At 12.5% of net sales, total operating expenses for the six months ended
January 30, 2016 were 22 basis points lower than the comparable prior
fiscal year period. Total operating expenses increased $5.5 million, or
1.1%, to $515.8 million from $510.3 million for the six months ended
January 31, 2015. The six months ended January 30, 2016 included $4.8
million of severance and other transition costs related to the
previously announced restructuring plan and $1.8 million of bad debt
expense related to outstanding receivables for a customer who declared
bankruptcy in the first quarter of fiscal 2016.
Operating income for the six months ended January 30, 2016 decreased
11.4%, or $12.3 million, to $95.6 million from $107.9 million for the
six months ended January 31, 2015. Operating income as a percentage of
net sales decreased 37 basis points to 2.3% compared to the same period
last fiscal year.
Net income for the six months ended January 30, 2016 decreased $8.1
million, or 13.3%, to $52.8 million, or $1.05 per diluted share, from
$60.9 million, or $1.21 per diluted share for the six months ended
January 31, 2015. Excluding $4.8 million of severance and other
transition costs and approximately $1.0 million of acquisition related
costs in the six months ended January 30, 2016, adjusted net income
decreased $9.3 million, to $56.3 million, or $1.12 per diluted share,
compared to adjusted net income of $65.6 million, or $1.31 per diluted
share, in the same period in fiscal 2015, which excludes the impact of
the previously disclosed non-recurring reduction in net sales.
Adjusted net sales, adjusted net income, adjusted earnings per diluted
share and free cash flow are non-GAAP financial measures. Please refer
to the tables in this press release for a reconciliation of all non-GAAP
financial measures with the most directly comparable financial measures
calculated in accordance with GAAP.
Acquisition of Global Organic/Specialty Source, Inc.
The Company today announced that through its wholly owned subsidiary
Albert's Organics, Inc. ("Albert's"), it had acquired certain assets of
Global Organic. Founded in 1999, Global Organic is a premier distributor
of organic fruits, vegetables, juices, milk, eggs, nuts, and coffee in
the Southeast, with primary operations located within the same facility
as UNFI in Sarasota, Florida. Global Organic's operations will be
combined with the Company's existing Albert's business in the Southeast.
Fiscal 2016 Guidance
UNFI provided its financial outlook for fiscal 2016, ending July 30,
2016, in the release of its preliminary results on February 29, 2016 and
is reaffirming that outlook today. For fiscal 2016, the Company
estimates net sales in the range of approximately $8.31 billion to $8.43
billion, an increase of approximately 1.5% to 3.0% over fiscal 2015. The
Company expects GAAP earnings per diluted share for fiscal 2016 in the
range of approximately $2.27 to $2.37 compared to fiscal 2015 GAAP
earnings per diluted share of $2.76. Adjusting for the severance and
other transition costs related to the aforementioned restructuring plan
of $4.8 million in the first half of fiscal 2016 related to the
previously disclosed termination of a customer distribution agreement
and anticipated acquisition costs of approximately $1.0 million in the
second quarter, adjusted earnings per diluted share for fiscal 2016 is
estimated to be in the range of $2.34 to $2.44, compared to fiscal 2015
adjusted earnings per diluted share of $2.85. Fiscal 2015 earnings per
diluted share was adjusted for the $7.7 million second quarter fiscal
2015 impact of the previously disclosed $9.3 million non-recurring
reduction in net sales the Company recognized in fiscal 2015. Capital
expenditures for fiscal 2016 are expected to be approximately $49.8
million to $59.0 million, or approximately 0.6% to 0.7% of estimated
fiscal 2016 net sales. Finally, the Company expects its fiscal 2016 tax
rate to be in the range of 39.7% to 40.1%. The Company's guidance does
not reflect any anticipated sales or earnings in connection with today's
announcement of the acquisition of certain assets of Global Organic or
the announcement on February 29, 2016 to acquire Haddon House Food
Products, Inc. ("Haddon House") and certain affiliated entities as well
as certain related real estate, which is currently expected to close
early in the fourth quarter of fiscal 2016.
Conference Call & Webcast
The Company's second quarter 2016 conference call and audio webcast will
be held today, Monday, March 7, 2016 at 5:00 p.m. EST. The
audio webcast of the conference call will be available to the public, on
a listen-only basis, via the Internet at the Investors section of the
Company's website at www.unfi.com.
The online archive of the webcast will be available on the Company's
website for 30 days.
About United Natural Foods
United Natural Foods, Inc. carries and distributes more than 85,000
products to more than 40,000 customer locations throughout the United
States and Canada. The Company serves a wide variety of retail formats
including conventional supermarket chains, natural product superstores,
independent retail operators and the food service channel. United
Natural Foods, Inc. was ranked by Forbes Magazine in 2014 as one of
“America's Best Managed Companies,” ranked by Fortune in 2012 as one of
its “Most Admired American Companies,” and chosen by Food Logistics
Magazine as one of its 2013 Top 20 Green Providers.
For more information on United Natural Foods, Inc., visit the
Company’s website at www.unfi.com.
Safe Harbor Statement under the Private Securities Litigation Reform
Act of 1995: Statements in this press release regarding the Company's
business that are not historical facts are "forward-looking statements"
that involve risks and uncertainties and are based on current
expectations and management estimates; actual results may differ
materially. The risks and uncertainties which could impact these
statements are described in the Company's filings under the Securities
Exchange Act of 1934, as amended, including its annual report on Form
10-K filed with the Securities and Exchange Commission (SEC) on
September 30, 2015, its quarterly report on Form 10-Q filed with the SEC
on December 10, 2015 and other filings the Company makes with the SEC,
and include, but are not limited to, the occurrence of any event, change
or other circumstance that could give rise to the termination of the
acquisition agreement entered into by the parties in connection with the
Company’s proposed acquisition of Haddon House; the ability of
the Company to consummate the proposed acquisition of Haddon House and
retain Haddon House’s customers on terms similar to those in place with
Haddon House; the Company's ability to successfully deploy its
operational initiatives to achieve synergies from the Haddon House
acquisition; the Company's dependence on principal customers; the
Company's sensitivity to general economic conditions, including the
current economic environment; changes in disposable income levels and
consumer spending trends; the Company's ability to reduce its expenses
in amounts sufficient to offset its increased focus on sales to
conventional supermarkets and the shift in the Company's product mix as
a result of its acquisition of Tony's Fine Foods and the resulting lower
gross margins on those sales; the Company's reliance on the continued
growth in sales of natural and organic foods and non-food products in
comparison to conventional products; increased competition in our
industry as a result of increased distribution of natural, organic and
specialty products by conventional grocery distributors and direct
distribution of those products by large retailers; the Company's ability
to timely and successfully deploy its warehouse management system
throughout its distribution centers and its transportation management
system across the Company; the addition or loss of significant
customers; volatility in fuel costs; the Company's sensitivity to
inflationary and deflationary pressures; the relatively low margins and
economic sensitivity of the Company's business; the potential for
disruptions in the Company's supply chain by circumstances beyond its
control; the risk of interruption of supplies due to lack of long-term
contracts, severe weather, work stoppages or otherwise; consumer demand
for natural and organic products outpacing suppliers’ ability to produce
those products; decreased forward buying opportunities; union-organizing
activities that could cause labor relations difficulties and increased
costs; the ability to identify and successfully complete acquisitions of
other natural, organic and specialty food and non-food products
distributors; management's allocation of capital and the timing of
capital expenditures; and the Company's ability to successfully deploy
its operational initiatives to achieve synergies from the acquisitions
of Tony’s Fine Foods and, if consummated, Haddon House. Any
forward-looking statements are made pursuant to the Private Securities
Litigation Reform Act of 1995 and, as such, speak only as of the date
made. The Company is not undertaking to update any information in the
foregoing reports until the effective date of its future reports
required by applicable laws. Any projections of future results of
operations are based on a number of assumptions, many of which are
outside the Company's control and should not be construed in any manner
as a guarantee that such results will in fact occur. These projections
are subject to change and could differ materially from final reported
results. The Company may from time to time update these publicly
announced projections, but it is not obligated to do so.
Non-GAAP Financial Measures: To supplement the financial information
presented on a generally accepted accounting principles (“GAAP”) basis,
the Company has included in this press release non-GAAP financial
measures for adjusted net sales, adjusted net income, adjusted diluted
earnings per common share and free cash flow. The non-GAAP measures
exclude the impact of expenses related to the actual and planned
severance and other transition costs related to the termination of our
distribution agreement with a customer that the Company announced in
July 2015, the net sales to that customer, the impact of a reduction in
net sales related to an incorrect calculation of amounts owed to a
customer, acquisition costs, and capital expenditures, as applicable.
The reconciliations of non-GAAP financial measures to the comparable
GAAP financial measures are presented in the tables appearing below. The
presentation of these non-GAAP financial measures is not intended to be
considered in isolation or as a substitute for any measure prepared in
accordance with GAAP. The Company believes that presenting these
non-GAAP financial measures aids in making period-to-period comparisons
and is a meaningful indication of its actual and estimated operating
performance. The Company's management utilizes and plans to utilize this
non-GAAP financial information to compare the Company's operating
performance during the 2016 fiscal year to the comparable periods in the
2015 fiscal year and to internally prepared projections.
|
UNITED NATURAL FOODS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except per share data amounts)
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
Six months ended
|
|
|
|
January 30,
2016
|
|
January 31,
2015
|
|
January 30,
2016
|
|
January 31,
2015
|
|
Net sales
|
|
$
|
2,047,712
|
|
|
$
|
2,016,546
|
|
|
$
|
4,124,361
|
|
|
$
|
4,009,022
|
|
|
Cost of sales
|
|
1,750,194
|
|
|
1,717,347
|
|
|
3,512,906
|
|
|
3,390,827
|
|
|
Gross profit
|
|
297,518
|
|
|
299,199
|
|
|
611,455
|
|
|
618,195
|
|
|
Operating expenses
|
|
253,830
|
|
|
249,448
|
|
|
511,054
|
|
|
509,496
|
|
|
Restructuring and asset impairment expenses
|
|
1,985
|
|
|
248
|
|
|
4,794
|
|
|
803
|
|
|
Total operating expenses
|
|
255,815
|
|
|
249,696
|
|
|
515,848
|
|
|
510,299
|
|
|
Operating income
|
|
41,703
|
|
|
49,503
|
|
|
95,607
|
|
|
107,896
|
|
|
Other expense (income):
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
3,602
|
|
|
3,554
|
|
|
7,350
|
|
|
6,809
|
|
|
Interest income
|
|
(398
|
)
|
|
(69
|
)
|
|
(550
|
)
|
|
(162
|
)
|
|
Other, net
|
|
757
|
|
|
(5
|
)
|
|
930
|
|
|
611
|
|
|
Total other expense, net
|
|
3,961
|
|
|
3,480
|
|
|
7,730
|
|
|
7,258
|
|
|
Income before income taxes
|
|
37,742
|
|
|
46,023
|
|
|
87,877
|
|
|
100,638
|
|
|
Provision for income taxes
|
|
15,059
|
|
|
18,179
|
|
|
35,063
|
|
|
39,752
|
|
|
Net income
|
|
$
|
22,683
|
|
|
$
|
27,844
|
|
|
$
|
52,814
|
|
|
$
|
60,886
|
|
|
Basic per share data:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
0.45
|
|
|
$
|
0.56
|
|
|
$
|
1.05
|
|
|
$
|
1.22
|
|
|
Weighted average basic shares of common stock outstanding
|
|
50,326
|
|
|
50,025
|
|
|
50,260
|
|
|
49,957
|
|
|
Diluted per share data:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
0.45
|
|
|
$
|
0.55
|
|
|
$
|
1.05
|
|
|
$
|
1.21
|
|
|
Weighted average diluted shares of common stock outstanding
|
|
50,388
|
|
|
50,277
|
|
|
50,351
|
|
|
50,195
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITED NATURAL FOODS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
(In thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
January 30,
2016
|
|
August 1,
2015
|
|
ASSETS
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
12,482
|
|
|
$
|
17,380
|
|
|
Accounts receivable, net
|
|
455,831
|
|
|
474,494
|
|
|
Inventories
|
|
941,509
|
|
|
982,559
|
|
|
Prepaid expenses and other current assets
|
|
61,340
|
|
|
46,976
|
|
|
Deferred income taxes
|
|
32,333
|
|
|
32,333
|
|
|
Total current assets
|
|
1,503,495
|
|
|
1,553,742
|
|
|
Property & equipment, net
|
|
562,631
|
|
|
572,452
|
|
|
Goodwill
|
|
265,230
|
|
|
266,640
|
|
|
Intangible assets, net
|
|
122,087
|
|
|
125,830
|
|
|
Other assets
|
|
33,575
|
|
|
31,526
|
|
|
Total assets
|
|
$
|
2,487,018
|
|
|
$
|
2,550,190
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
|
|
$
|
356,768
|
|
|
$
|
390,134
|
|
|
Accrued expenses and other current liabilities
|
|
139,656
|
|
|
129,113
|
|
|
Current portion of long-term debt
|
|
11,711
|
|
|
11,613
|
|
|
Total current liabilities
|
|
508,135
|
|
|
530,860
|
|
|
Notes payable
|
|
275,766
|
|
|
362,993
|
|
|
Long-term debt, excluding current portion
|
|
168,894
|
|
|
174,780
|
|
|
Deferred income taxes
|
|
64,273
|
|
|
65,644
|
|
|
Other long-term liabilities
|
|
28,494
|
|
|
30,380
|
|
|
Total liabilities
|
|
1,045,562
|
|
|
1,164,657
|
|
|
Commitments and contingencies
|
|
—
|
|
|
—
|
|
|
Stockholders’ equity:
|
|
|
|
|
|
Preferred stock, $0.01 par value, authorized 5,000 shares; none
issued or outstanding
|
|
—
|
|
|
—
|
|
|
Common stock, $0.01 par value, authorized 100,000 shares; 50,331
issued and outstanding
shares at January 30, 2016; 50,096
issued and outstanding shares at August 1, 2015
|
|
503
|
|
|
501
|
|
|
Additional paid-in capital
|
|
430,074
|
|
|
420,584
|
|
|
Accumulated other comprehensive loss
|
|
(25,826
|
)
|
|
(19,443
|
)
|
|
Retained earnings
|
|
1,036,705
|
|
|
983,891
|
|
|
Total stockholders’ equity
|
|
1,441,456
|
|
|
1,385,533
|
|
|
Total liabilities and stockholders’ equity
|
|
$
|
2,487,018
|
|
|
$
|
2,550,190
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITED NATURAL FOODS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(In thousands)
|
|
|
|
|
|
|
|
Six months ended
|
|
|
|
January 30,
2016
|
|
January 31,
2015
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
Net income
|
|
$
|
52,814
|
|
|
$
|
60,886
|
|
|
Adjustments to reconcile net income to net cash provided by (used
in) operating activities:
|
|
|
|
|
|
Depreciation and amortization
|
|
32,847
|
|
|
29,657
|
|
|
Share-based compensation
|
|
9,424
|
|
|
9,554
|
|
|
Loss (gain) on disposals of property and equipment
|
|
415
|
|
|
(779
|
)
|
|
Excess tax benefits from share-based payment arrangements
|
|
(432
|
)
|
|
(2,661
|
)
|
|
Restructuring and asset impairment
|
|
480
|
|
|
803
|
|
|
Deferred income taxes
|
|
—
|
|
|
(6,052
|
)
|
|
Provision for doubtful accounts
|
|
4,832
|
|
|
2,302
|
|
|
Non-cash interest (income) expense
|
|
(102
|
)
|
|
129
|
|
|
Changes in assets and liabilities, net of acquired businesses:
|
|
|
|
|
|
Accounts receivable
|
|
12,577
|
|
|
(50,753
|
)
|
|
Inventories
|
|
39,130
|
|
|
(92,525
|
)
|
|
Prepaid expenses and other assets
|
|
(16,729
|
)
|
|
(22,217
|
)
|
|
Accounts payable
|
|
(16,589
|
)
|
|
20,146
|
|
|
Accrued expenses and other liabilities
|
|
5,944
|
|
|
(1,389
|
)
|
|
Net cash provided by (used in) operating activities
|
|
124,611
|
|
|
(52,899
|
)
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
Capital expenditures
|
|
(20,472
|
)
|
|
(56,163
|
)
|
|
Purchases of acquired businesses, net of cash acquired
|
|
(31
|
)
|
|
(7,987
|
)
|
|
Proceeds from disposals of property and equipment
|
|
57
|
|
|
840
|
|
|
Long-term investment
|
|
—
|
|
|
(3,000
|
)
|
|
Net cash used in investing activities
|
|
(20,446
|
)
|
|
(66,310
|
)
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
Proceeds from borrowings from long-term debt
|
|
—
|
|
|
150,000
|
|
|
Repayments of long-term debt
|
|
(5,788
|
)
|
|
(5,539
|
)
|
|
Proceeds from borrowings under revolving credit line
|
|
214,549
|
|
|
438,293
|
|
|
Repayments of borrowings under revolving credit line
|
|
(301,243
|
)
|
|
(488,156
|
)
|
|
(Decrease) increase in bank overdraft
|
|
(16,480
|
)
|
|
33,666
|
|
|
Proceeds from exercise of stock options
|
|
1,172
|
|
|
3,202
|
|
|
Payment of employee restricted stock tax withholdings
|
|
(1,603
|
)
|
|
(2,163
|
)
|
|
Excess tax benefits from share-based payment arrangements
|
|
432
|
|
|
2,661
|
|
|
Capitalized debt issuance costs
|
|
—
|
|
|
(900
|
)
|
|
Net cash (used in) provided by financing activities
|
|
(108,961
|
)
|
|
131,064
|
|
|
EFFECT OF EXCHANGE RATE CHANGES ON CASH
|
|
(102
|
)
|
|
(497
|
)
|
|
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
|
|
(4,898
|
)
|
|
11,358
|
|
|
Cash and cash equivalents at beginning of period
|
|
17,380
|
|
|
16,116
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
12,482
|
|
|
$
|
27,474
|
|
|
|
|
|
|
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
Cash paid for interest
|
|
$
|
7,891
|
|
|
$
|
6,868
|
|
|
Cash paid for federal and state income taxes, net of refunds
|
|
$
|
46,896
|
|
|
$
|
57,471
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITED NATURAL FOODS, INC.
|
|
|
|
Reconciliation of GAAP Net Sales Growth to Non-GAAP Adjusted Net
Sales Growth (unaudited)
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
|
Six months ended
|
|
|
|
|
|
January 30,
2016
|
|
January 31,
2015
|
|
Percentage
Growth
|
|
January 30,
2016
|
|
January 31,
2015
|
|
Percentage
Growth
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
2,047,712
|
|
|
$
|
2,016,546
|
|
|
1.5
|
%
|
|
$
|
4,124,361
|
|
|
$
|
4,009,022
|
|
|
2.9
|
%
|
|
Adjustment (1) |
|
—
|
|
|
(100,772
|
)
|
|
|
|
(58,439
|
)
|
|
(204,412
|
)
|
|
|
|
Adjustment (2) |
|
$
|
—
|
|
|
$
|
7,736
|
|
|
|
|
$
|
—
|
|
|
$
|
7,736
|
|
|
|
|
Adjusted net sales
|
|
$
|
2,047,712
|
|
|
$
|
1,923,510
|
|
|
6.5
|
%
|
|
$
|
4,065,922
|
|
|
$
|
3,812,346
|
|
|
6.7
|
%
|
(1) Adjusted to exclude net sales in each period related to a
customer distribution contract that was terminated in the first quarter
of fiscal 2016.
(2) Adjusted to exclude the $7.7 million
second quarter fiscal 2015 impact of the previously disclosed $9.3
million non-recurring reduction in net sales the Company recognized in
fiscal 2015.
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME WITH ADJUSTMENTS
Reconciliation of GAAP Results to Non-GAAP Presentation
(unaudited)
(In thousands, except per share data)
|
|
|
|
|
|
|
|
Three months ended January 30, 2016
|
|
|
|
GAAP
|
|
Adjustments (1) |
|
Adjusted
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
22,683
|
|
|
$
|
1,772
|
|
|
$
|
24,455
|
|
|
|
|
|
|
|
|
|
Diluted per share data:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
0.45
|
|
|
$
|
0.04
|
|
|
$
|
0.49
|
|
Weighted average diluted shares of common stock outstanding
|
|
50,388
|
|
|
—
|
|
|
50,388
|
(1) Adjusted for $2.0 million of severance and other
transition costs related to the previously disclosed restructuring plans
and approximately $1.0 million of acquisition related costs, net of tax.
|
|
|
Six months ended January 30, 2016
|
|
|
|
GAAP
|
|
Adjustments (1) |
|
Adjusted
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
52,814
|
|
|
$
|
3,460
|
|
|
$
|
56,274
|
|
|
|
|
|
|
|
|
|
Diluted per share data:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
1.05
|
|
|
$
|
0.07
|
|
|
$
|
1.12
|
|
Weighted average diluted shares of common stock outstanding
|
|
50,351
|
|
|
|
|
50,351
|
(1) Adjusted for $4.8 million of severance and other
transition costs related to the previously disclosed restructuring plans
and approximately $1.0 million of acquisition related costs, net of tax.
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME WITH ADJUSTMENTS
Reconciliation of GAAP Results to Non-GAAP Presentation
(unaudited)
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
Three months ended January 31, 2015
|
|
|
|
|
GAAP
|
|
Adjustments (1) |
|
|
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
2,016,546
|
|
|
$
|
7,736
|
|
|
|
$
|
2,024,282
|
|
|
|
Net income
|
|
$
|
27,844
|
|
|
$
|
4,680
|
|
|
|
$
|
32,524
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted per share data:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
0.55
|
|
|
$
|
0.09
|
|
|
|
$
|
0.65
|
|
*
|
|
Weighted average diluted shares of common stock outstanding
|
|
50,277
|
|
|
|
|
|
50,277
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended January 31, 2015
|
|
|
|
|
GAAP
|
|
Adjustments (1) |
|
|
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
4,009,022
|
|
|
$
|
7,736
|
|
|
|
$
|
4,016,758
|
|
|
|
Net income
|
|
$
|
60,886
|
|
|
$
|
4,680
|
|
|
|
$
|
65,566
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted per share data:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
1.21
|
|
|
$
|
0.09
|
|
|
|
$
|
1.31
|
|
*
|
|
Weighted average diluted shares of common stock outstanding
|
|
50,195
|
|
|
|
|
|
50,195
|
|
|
|
* Reflects rounding
|
|
|
|
|
|
|
|
|
(1) Adjusted to exclude the $7.7 million second quarter
fiscal 2015 impact of the previously disclosed $9.3 million
non-recurring reduction in net sales the Company recognized in fiscal
2015.
|
Reconciliation of GAAP Operating Cash Flow to Non-GAAP Free Cash
Flow (unaudited)
|
|
(in thousands)
|
|
|
|
|
|
Three months ended
January 30, 2016
|
|
Net cash provided by operating activities
|
$
|
119,119
|
|
Capital expenditures
|
12,884
|
|
Free cash flow
|
$
|
106,235
|
|
|
|
|
|
Reconciliation of 2016 Guidance for Estimated GAAP Diluted
Earnings per Common Share to
Estimated Non-GAAP Adjusted Diluted Earnings per Common Share
(unaudited)
|
|
|
|
|
|
Fiscal Year Ending July 30, 2016
|
|
|
Low Range
|
|
High Range
|
|
|
|
|
|
|
GAAP diluted earnings per common share
|
$
|
2.27
|
|
|
$
|
2.37
|
|
Less impact of severance and other transition costs
|
0.06
|
|
|
0.06
|
|
Less impact of acquisition costs
|
0.01
|
|
|
0.01
|
|
Non-GAAP diluted earnings per common share
|
$
|
2.34
|
|
|
$
|
2.44
|
|
|
|
|
|
|
|
|
|
Reconciliation of 2015 GAAP Results to Non-GAAP Presentation
Included in Fiscal 2016 Guidance (unaudited)
(In thousands, except per share data)
|
|
|
|
|
|
|
|
Fiscal year ended August 1, 2015
|
|
|
|
GAAP
|
|
Adjustments (1) |
|
Adjusted
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
138,734
|
|
|
$
|
4,671
|
|
|
$
|
143,405
|
|
|
|
|
|
|
|
|
|
Diluted per share data:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
2.76
|
|
|
$
|
0.09
|
|
|
$
|
2.85
|
|
Weighted average diluted shares of common stock outstanding
|
|
50,267
|
|
|
|
|
50,267
|
(1) Adjusted for the $7.7 million second quarter fiscal 2015
impact of the $9.3 million reduction in net sales the Company recognized
in fiscal 2015 related to an incorrect calculation of amounts owed to a
customer.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160307006485/en/
Source: United Natural Foods, Inc.
United Natural Foods, Inc.
Michael Zechmeister
Chief Financial
Officer
(401) 528-8634
or
ICR
Katie Turner
General
Information
(646) 277-1228