United Natural Foods Q2 Profit Meets View, Sales Top; Boosts 2014 Outlook

(RTTNews) - Specialty foods distributor United Natural Foods, Inc. (UNFI) reported Tuesday a profit for the second quarter that increased 24 percent from last year, reflecting improved operating margins and double-digit revenue growth. Earnings per share matched analysts' expectations, while quarterly sales topped their estimates. The company also raised its earnings and revenue forecast for the full-year 2014.

"Our independent channel grew over 11% during the quarter driven by continued innovation in products and services supported by UNFI's extensive product offering. Continued demand for our products further demonstrates that the trend towards natural and organic consumption continues to gain momentum," President and CEO Steven Spinner said in a statement.

The Providence, Rhode Island-based company reported net income of $27.95 million or $0.56 per share for the second quarter, higher than $22.62 million or $0.46 per share in the prior-year quarter.

On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $0.56 per share in the quarter. Analysts' estimates typically exclude one-time items.

The company noted that the year-ago quarter included about $0.04 per share of negative impact related to the Auburn, Washington labor action.

Net sales for the quarter grew 13.9 percent to $1.65 billion from $1.45 billion in the same quarter last year, and topped eleven Wall Street analysts' consensus estimate of $1.64 billion by a whisker.

Operating margin for the quarter expanded 27 basis points to 3.0 percent from last year's, as total operating expenses as a percentage of net sales declined 70 basis points, partially offset by a 40 basis points contraction in gross margin.

Looking ahead to fiscal 2014, the company raised its earnings guidance to a range of $2.45 to $2.51 per share from the prior forecast in the range of $2.40 to $2.50 per share.

The company also now projects net sales in a range of $6.70 billion to $6.78 billion, up from the previously provided guidance range of $6.65 billion to $6.78 billion.

Street is currently looking for full-year 2014 earnings of $2.52 per share on annual revenues of $6.72 billion.

UNFI closed Monday's regular trading session at $75.39, up $0.40 or 0.53% on a volume of 0.37 million shares.