LONDON, UK / ACCESSWIRE / July 6, 2018 / If you want access to our free earnings report on United Natural Foods, Inc. (NASDAQ: UNFI) ("UNF"), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=UNFI. United Natural Foods reported its third quarter fiscal 2018 operating and financial results on June 06, 2018. The organic and specialty foods distributor outperformed top- and bottom-line expectations. Additionally, the Company raised its sales guidance for FY18. Register today and get access to over 1,000 Free Research Reports by joining our site below:

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Earnings Highlights and Summary

UNF's net sales for the third quarter of fiscal 2018 increased 11.8% to $2.65 billion from $2.37 billion in Q3 FY17 due to continued increase in demand for the Company's products. UNF's reported numbers beat analysts' estimates of $2.65 billion.

During Q3 FY18, UNF's gross margin was 15.41%, reflecting a 5-basis point (bps) drop compared to Q3 FY17. This decrease was primarily driven by a shift in customer mix where sales growth with lower margin customers outpaced growth with other customers coupled with an increase in inbound freight costs. The Company's gross margin during the reported quarter included the positive impact of a change in accounting estimates of $20.9 million as UNF revised its calculation for its accrual for inventory purchases.

For Q3 FY18, UNF's total operating expenses were $325.9 million, or 12.30% of net sales, compared to $301.4 million, or 12.72% of net sales, for Q3 FY17. The Company's total operating expenses in the reported quarter included restructuring charges of approximately $0.2 million, primarily associated with the Company's fiscal 2017 restructuring plan. UNF's adjusted operating expenses were $325.8 million, or 12.30% of net sales, in Q3 FY18 compared to adjusted operating expenses of $297.5 million, or 12.55% of net sales, for Q3 FY17. The decrease in adjusted operating expenses was primarily driven by leveraging of fixed costs.

UNF recorded operating income of $82.2 million for Q3 FY18, up 26.5% compared to $64.9 million for Q3 FY17. The Company's adjusted operating income in the reported quarter, which excluded restructuring charges, was $82.3 million, reflecting an increase of 19.5%, compared to adjusted operating income of $68.9 million for the prior year's same quarter.

During Q3 FY18, UNF's adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) was $104.0 million, reflecting an increase of 15.1% compared to adjusted EBITDA of $90.4 million for Q3 FY17.

UNF's effective tax rate for Q3 FY18 decreased to 33.3% from 39.4% in Q3 FY17. Excluding tax expense of $1.0 million recorded in the reported quarter associated with the remeasurement of US net deferred tax liabilities resulting from the Tax Cuts and Jobs Act of 2017 (Tax Act), UNF's adjusted effective tax rate decreased to 32.0% for Q3 FY18.

UNF's net income surged 41.8% for Q3 FY18 to $51.9 million, or $1.02 per diluted share, compared to $36.6 million, or $0.72 per diluted share, in Q3 FY17. The Company's adjusted earnings surged 35.1% in reported quarter to $1.04 per share, compared to adjusted earnings of $0.77 per diluted share for the year earlier corresponding quarter. UNF's earnings smashed past Wall Street's estimates of $0.93 per share.

Cash Matters

As of April 28, 2018, UNF's liquidity position remained strong with availability of $528.5 million, under its revolving credit facility. Pursuant to the authorized share repurchase program of $200 million announced October 06, 2017, for the fiscal year-to-date period, the Company purchased 564,660 shares of its common stock at an aggregate cost of $22.2 million.

Outlook

For fiscal 2018, UNF is forecasting annual net sales to increase 10.3% to 10.8% on a y-o-y basis compared to its previous guidance of 8.0% to 8.5%. The Company is expecting GAAP EPS for fiscal 2018 to be in the band of $3.39 to $3.44 compared to the previous estimate of $3.27 to $3.35. For FY18, UNF is estimating adjusted earnings to be in the range of approximately $3.18 to $3.23 per share.

Stock Performance Snapshot

July 05, 2018 - At Thursday's closing bell, United Natural Foods' stock marginally declined 0.49%, ending the trading session at $42.66.

Volume traded for the day: 462.16 thousand shares.

Stock performance in the past twelve-month period - up 18.34%

After yesterday's close, United Natural Foods' market cap was at $2.19 billion.

Price to Earnings (P/E) ratio was at 14.38.

The stock is part of the Services sector, categorized under the Food Wholesale industry. This sector was up 0.6% at the end of the session.

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