United Natural Foods Inc. (UNFI) stock plunged 6.6% in premarket trade on Tuesday, following the company’s announcement of a fiscal fourth-quarter loss and sales that were below expectations.
- The company recorded a net loss of $68 million, equivalent to $1.15 per share, for the quarter ending July 29. This is a significant decline compared to the same period last year when they reported an income of $39 million, or 63 cents per share.
- However, after adjusting for certain items, the adjusted per-share loss came in narrower at 25 cents, which is better than the 39 cent consensus estimate by FactSet analysts.
- Sales for the quarter rose slightly from $7.273 billion to $7.417 billion. Unfortunately, this figure fell short of the FactSet consensus of $7.467 billion.
Factors Impacting Performance
According to CEO Sandy Douglas, there were a few factors that affected profitability:
- A decrease in inflation-driven procurement gains
- Elevated shrink
Douglas added that the company is anticipating further challenges during the first half of fiscal 2024 as they cycle through the elevated inflationary benefits.
Adjusted Outlook for Fiscal 2024
United Natural Foods Inc. has revised its earnings outlook for fiscal year 2024:
- Previously projected range: Loss of 88 cents to EPS of 38 cents
- FactSet consensus for EPS: $1.94
Additionally, the company has provided its sales outlook for fiscal year 2024:
- Expected sales range: $30.9 billion to $31.5 billion
- Consensus estimate for sales: $31.1 billion
Strategic Transformation Plan
In an effort to improve profitability and enhance customer service, United Natural Foods Inc. has introduced some changes at the leadership level. The company will be adding three independent directors to its board who will focus on a comprehensive transformation plan.
Stock Performance
United Natural Foods Inc. stock has experienced a significant decline of 51% year-to-date, while the S&P 500 has shown a 13% increase.
